Port of Seattle to start up rental-car center?

The Port of Seattle Commission is expected to decide today whether to move ahead with a $413 million rental-car center near Seattle-Tacoma International Airport and make it the first big project to gain approval since a state audit blasted Port construction practices.

A go-ahead would sidestep a moratorium imposed by Port commissioners, who pledged that nothing new would be built until they were satisfied that post-audit reforms were in place.

Commissioners are concerned about the project's estimated cost, up almost $100 million, or nearly 30 percent, over the last year.

"That's more than a rounding error," said Commissioner Bill Bryant. "But a lot of that is the increased cost of steel and concrete."

Commission President John Creighton said he's seen enough progress on Port reforms to let the project — 10 years in the making — advance and will vote to spend $5 million more on design, as well as preparation of the 23-acre site.

Project proponents, led by rental-car companies, argue that delaying construction on the 5,400-car garage would only raise costs. The facility is being funded almost entirely by fees paid by rental-car customers — not taxes the Port collects from King County property owners.

They also note that although the state audit did not address this project, it is being held up because of the audit.

Released in December, the audit focused on construction projects between 2004 and 2007, most of which involved building a third runway at Sea-Tac. Auditors said the Port skirted competitive-bidding rules, mismanaged construction contracts, concealed information from the commission and wasted $97 million in public money. The U.S. Justice Department announced last month it would conduct a criminal investigation.

The rental-car center, now scheduled to open in 2011, would include not just the massive garage but also areas to wash and fuel cars, and a customer-service area with Wi-Fi, flight-information displays and quick check-in kiosks. Customers would be shuttled to the site by bus.

Proponents say the facility is needed to accommodate growing demand. The number of airline passengers and car renters increased 4 percent a year between 2003 and 2007. This puts pressure on the main airport garage, which now devotes two of its eight floors and 3,200 of its 12,500 parking paces to rental-car companies.

The garage will be full almost every day by 2011, according to airport projections.

The new facility is expected to free up the main garage, give rental-car companies more space, and level competition by bringing rental-car companies under one roof. Now, only the five largest companies use the main garage.

The Port considered two other options: expanding the main garage, or moving rental-car companies out of the garage and letting them scatter to whatever sites they could find.

Port officials concluded that expanding the garage would cost $358 million — nearly as much as the proposed project — and would be more disruptive to the airport and take five years longer to complete.

They also rejected the idea of scattering the companies because it would increase traffic and pollution, wouldn't level competition, and would be less convenient to customers.

The consolidated facility represents the industry trend, said Lorie Tallarico, director of properties for the Avis Budget Rental Car Group and the rental-car industry's spokeswoman for the project.

And, Tallarico said, Sea-Tac's facility — which must contend with factors such as limited space, earthquake safeguards and high labor costs — compares favorably in price with similar facilities built or planned for Las Vegas and Phoenix.

Rental-car companies don't want to heap extra charges on their customers, Tallarico said, and have worked to ensure there are no unnecessary costs in the Sea-Tac project.

Rental-car customers would pay the tab through a $4-per-day fee, which has been collected since February 2006. The Port has raised $39 million from those fees and spent $25 million designing the facility and purchasing property.

The car companies also would pay $10 million in annual rent and operation costs when the facility opens.

Creighton said he's ready to vote "yes" today even though the Port hasn't enacted all of the reforms recommended by the audit.

"I see good progress on implementing audit recommendations," he said, adding that he's inclined to nudge the rental-car project forward while keeping the moratorium in place and reserving the commission's right to delay the next phase of the project.

Creighton says his chief concern is keeping the project on budget. "Whether it's funded by taxpayer money or tenant money, I believe the commission has a fiduciary duty to make sure the money is spent as efficiently as possible."

Bob Young: 206-464-2174 or byoung@seattletimes.com