Los Angeles – L.A. World Airports (LAWA), the City-owned entity that operates LAX, is a major economic engine, contributing an estimated $2.6 billion to the regional economy and 360,000 jobs to Southern California. But LAWA still has significant work to do to address impending traffic jams in and around the terminals, to upgrade passenger experiences, and to improve airport business practices— including an apparent dearth of bidders on airport contracts— according to a report issued by Los Angeles City Controller Ron Galperin.
The charter-mandated report, called an Industrial, Economic and Administrative Survey (IEA), was written by auditors from KH Consulting Group. LAX is in the midst of an $8.5 billion modernization program that includes upgrades to its terminals, including the new Tom Bradley Terminal. It is also in the planning stages of its Landside Access Modernization Program (LAMP), which is designed to improve transportation in and out of LAX. The program includes an Automated People Mover, Intermodal Transportation Facilities, a Consolidated Rent-A-Car Center, improvements to the Central Terminal Area and a connection to Metro. The consultants warned that the LAMP project will generate greatly increased traffic and reduced parking in LAX’s Central Terminal Area during construction— and that LAWA has not sufficiently identified the impacts and mitigations that will be necessary.
“Traffic will get worse before it gets better,” said Controller Galperin. “And any goodwill we’ve engendered with passengers will quickly go away if LAWA doesn’t adequately address the traffic and parking problems that its large-scale construction projects are going to create,” said Controller Galperin.
Passenger Experience: The number of passengers served by LAX grew from 61.5 million in 2005 to 74.9 million in 2015— a record for LAX, the third busiest airport in the United States. At the same time, according to JD Powers’ 2015 North American Airport Study, LAX ranks 29th out of 31 large airports in passenger satisfaction.
A record average 75,690 vehicles per day entered LAX’s Central Terminal Area in FY 2014-15. During construction on the LAMP project, portions of which are scheduled to be completed in 2023, various parking structures will be demolished, lanes will be closed, and cars will compete with construction vehicles for space, causing traffic congestion in the Central Terminal Area. All of this is likely to diminish passengers’ experiences as they arrive and depart from LAX.
Auditors said LAWA was not prepared to handle these problems. No one unit or individual is currently responsible for coordinating the systems needed to keep traffic flowing during construction. They also said LAX has insufficient staff in these areas, lacks resources dedicated to traffic engineering, and warned of the potential for breakdowns in some key guest service areas, including the handling of disabled passengers.
The auditors urged LAWA to engage in proactive traffic management planning and to create a unit specifically focused on traffic engineering— something the auditors said exists at the Port Authority of New York and New Jersey, which runs New York-area airports.
To improve the passenger experience, the auditors also recommended that LAX upgrade amenities such as Wi-Fi speed and charging stations; add more LA-themed concessions; and use technology and apps to better inform passengers about travel times and wait times. To help passengers navigate the terminals, auditors also recommended that the airport train more employees to improve the hospitality extended to travelers.
Procurement: In FY 2014-15, LAWA Procurement, a division of the airport authority that manages purchasing for everyday operations (not large-scale construction projects), awarded $593 million in contracts--of which about $104 million was for goods, equipment, and non-professional services. In the case of these goods and services contracts, auditors found that 28% of Requests for Bids (RFBs) received only two bids and 30% got only one bid. Auditors said it was difficult to know whether LAWA was getting the best value from its vendors and contractors, but noted the City’s own goals call for a minimum of three bidders per solicitation.
“LAWA must scrutinize and reform its bidding processes,” said Controller Galperin. “Otherwise we have no way of knowing whether we are getting the best value for our money— which is what the competitive bidding process was created to ensure.”
Background: The Los Angeles City Charter requires the Controller, Mayor and City Council to jointly administer a survey of each of the City’s proprietary departments every five years.
Other important topics auditors addressed in the IEA include LAWA’s environmental impact, economic development around airport facilities, the need for more long-term strategic planning, and using performance metrics to improve operations and public accountability.
“We must use every tool available to enhance our airport’s service to Angelenos and our millions of visitors, and the 2016 Industrial, Administrative and Economic Survey of LAWA will help us do that,” said Mayor Garcetti. “I appreciate the Council and the City Controller’s hard work on this report, and I look forward to using its findings to improve our airport.”
KH Consulting Group prepared the last LAWA IEA, in 2008. The consultants noted several upgrades in the interim, including reconstruction of the Tom Bradley International Terminal, new retail and food concessions, and the new Airport Response Control Center, which brings diverse staff together with technology to better respond to operating needs during peak travel times.