AlburyCity - Council Meeting Agenda

CM13.2. Airport Enhanced Screening Equipment Tender Award

DATE 5 October 2020 FIL REFERENCE FIL20/01572

CONFIDENTIAL No

FURTHER ENQUIRIES Ambrose Glass PHONE 02 6023 8273 Service Leader Business & Lifestyle AUTHOR Nick Politis

Purpose of Report

To recommend a preferred contractor for the procurement, installation and commissioning, staff training and ongoing servicing of new airport body and baggage screening equipment for the Albury Airport.

Background

The Department of Home Affairs has amended the Aviation Transport Security Regulations 2005 to strengthen the aviation security framework through the Aviation Transport Security Amendment (Security Controlled Airports) Regulations 2019. These amendments will take effect at Albury Airport from 30 June 2021.

The regulatory changes include introducing a new Airport Tier Model to classify airports and provide a new definition of a screened air service. Albury Airport under the new regulations will therefore need to upgrade the current passenger and carry-on baggage screening equipment in order to maintain compliance, noting all other current checked baggage screening equipment at the Albury Airport meets the amended regulations and will not need to be replaced. On 12 August 2019 the Department of Home Affairs issued all Australian Airports a list of operationally compliant equipment which meets the new standards to guide Airports in their procurement activities.

To assist regional airports in meeting the new aviation security screening requirements, the Department of Home Affairs and the Department of Industry, Innovation and Science announced the Regional Airports Security Screening Fund (RASSF). Under the RASSF, Albury Airport was granted $405,000 in May 2020 to contribute towards procuring and commissioning the enhanced screening equipment. Further to this, and recognising that many airports will require capital works to support the installation of the new screening equipment, the Department of Infrastructure, Transport, Regional Development and Communications have subsequently announced the Regional Airports Screening Infrastructure (RASI) program. Albury Airport made a submission under the RASI program on Friday 24 July 2020, outcomes of this submission are yet to be released.

Tenders were invited for Contract No.20/01572 to supply and install an Airport Body Scanner and Multi View Baggage X-Ray system. The tender was advertised in the Border Mail, Sydney Morning Herald and on Tenderlink. Applications closed at 12.00pm AEST on Wednesday 2 September 2020, with three compliant submissions received.

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Council’s budget allocation for the purchase of the equipment and associated installation and training is $405,000, as per the RASSF grant. It is anticipated the contract will be completed in the 2020/21 financial year with a warranty period and liability period extending up to the 2022/23 financial year.

Tender Assessment

At the close of tenders, submissions were received from the following companies:

 Leidos Security Detection and Automation Group Pty Ltd (North Melbourne, VIC);  Smiths Detection (Australia) Pty Ltd (Botany, NSW); and  Rapiscan System Pty Ltd (St Leonards, NSW).

All tenders were evaluated in accordance with Council's Procurement Policy and Guidelines. The assessment panel for the tender comprised of:

 Team Leader Airport Operations – Nick Politis;  Team Leader Procurement and Contract Management – Elisha Lieschke;  Airport Compliance Supervisor – Carmel Hilton; and  Airport Business Development Officer – Lisa Mangelsdorf.

Conformity Check

A conformity assessment was undertaken to ensure all submissions received were in accordance with the contract documentation and specifications.

Company Pricing Details Supporting Insurance & WHS Comment Information Package Rapiscan System Yes Yes Yes Compliant Pty Ltd Leidos Security Yes Yes Yes Compliant Detection and Automation Australia Group Pty Ltd Smiths Detection Yes Yes Yes Compliant (Australia) Pty Ltd

As indicated above, the conformity check showed all three submissions to be compliant, supplying the required documentation and offering equipment that meets the Department of Home Affairs list of operationally compliant equipment, and were therefore progressed for further consideration as part of the tender evaluation process.

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Qualitative Assessment

The qualitative assessment considered a range of issues including:

 Past performance – including referee checks, relevant experience and expertise in performing same or similar projects;  Methodology and program – project plans, work methods, media, training, ongoing maintenance and proposed timeline in consideration of COVID-19 impacts;  Capacity – current and future commitments, work in progress and COVID-19 constraints;  Capability – including availability of resources, equipment supply arrangements, and contract management capabilities; and  Benefit to local region – social and community benefits to the Albury/Wodonga region.

Company Past Methodology Capacity Capability Local Total (100) Performan & Program (15) (15) Benefit (10) ce (30) (30) Leidos 26 24 12 12 1 75 Security Detection and Automation Australia Group Pty Ltd Smiths 26 24 10 11 1 72 Detection (Australia) Pty Ltd

Rapiscan 26 16 11 11 2 66 System Pty Ltd

Leidos Security Detection and Automation Australia Group Pty Ltd

Based in North Melbourne, VIC under the international Leidos brand, this global-scale and well- credentialed company has provided equipment and ongoing services to Albury Airport since 2009. Field technicians are based in NSW and allowing service and maintenance schedules to continue even during the COVID-19 pandemic. Leidos Security Detection and Automation Australia Group Pty Ltd has undertaken a number of similar projects with other Australian and New Zealand Regional Airports, including DHL Global Forwarding, Australian Government Department of Home Affairs, Victorian State Department of Justice and AVSEC Aviation Security Service, New Zealand.

Leidos Security Detection and Automation Australia Group Pty Ltd current work commitments include installation of similar equipment and services to the following airports; WA, to be

Agenda - AlburyCity Council Meeting – Monday 26 October 2020 3 AlburyCity - Council Meeting Agenda completed in November 2020; TAS, to be completed in December 2020; Dubbo City Regional Airport NSW, to be completed in December 2020; Kununurra Airport WA, to be complete in December 2020; and WA, to be completed in December 2020. During the period of planned installation for Albury Airport during the first quarter of 2021, Leidos Security Detection and Automation Australia Group Pty Ltd have reported no competing priorities.

Referees from other regional airports were contacted and the information provided indicated the company and its equipment were highly recommended, performing particularly well in areas of user experience, ease of use, the company’s project management, cooperation, environmental preservation and quality of service support and workmanship. In 2009, Albury Airport procured a checked baggage screening system from Leidos Group (at the time called L3), which is currently in use and serviced regularly by Leidos. The panel assessors at this time rated the procurement and associated activities highly, especially the capability and technical assessment which was rated as excellent.

Leidos Security Detection and Automation Australia Group Pty Ltd utilises a repeatable methodology for their projects which incorporates the unique requirements for Albury Airport. Their submission contained a detailed methodology to minimise impact to Albury Airport operations, drawings, product specifications detailing enhanced and non-invasive user experience, warranty and service needs, as well as outlining their intended timeline of 129 days to meet AlburyCity’s requirements and phases of the project. The company have included a Workplace Health and Safety management system as part of their submission.

Given the highly technical nature of this equipment, the legislation requirements and that Leidos Group is a company based outside of the local community, there is limited direct local benefit to the local economy as a result of this procurement activity beyond accommodation, meals and expenditure on incidental items by their project and servicing teams.

Figure 1. Leidos Security Detection and Automation Australia Group Pty Ltd equipment

User to stand stationary in neutral position within Body Scanner during scanning.

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 Body Scanner ProVision 2  Carry-On Baggage Multi-View X-Ray ACX  UPS Power Supply included 6.4 MV (Multi-View)  Throughput: 300 passengers per hour  5m of roller bed included & UPS Power Supply

Smiths Detection (Australia) Pty Ltd

Established in 1998 within Australia, Smiths Detection (Australia) Pty Ltd is one of five operating divisions of Smiths Group, a global technology company based in the United Kingdom. Since 2011 Smiths Detection (Australia) Pty Ltd has provided equipment and a continued maintenance service to Albury Airport with their Field Service Engineers based in Sydney. Smiths Detection (Australia) Pty Ltd currently have a number of similar projects underway with other Australian regional airports and, at the time of compiling this report, two metropolitan airports.

Smiths Detection (Australia) Pty Ltd current commitments include installation of similar equipment at the following airports; QLD, QLD, and Hamilton Island Airport QLD to be completed in October 2020, and to be completed in December 2020. In the period of planned installation for Albury Airport during the first quarter of 2021, Smiths Detection (Australia) Pty Ltd have reported no competing priorities.

Referees from other regional airports were contacted and the information provided indicated the company and its equipment was recommended, with some concerns raised regarding the need to use airport personnel and plant equipment to unload and move equipment when installing. The Body Scanner also requires passengers and users to physically turn and walk themselves in a circular motion during the scanning process, which may impact the elderly or incapacitated users. AlburyCity has previous and current experience dealing with Smiths Detection (Australia) Pty Ltd as they installed both the current Cabin Baggage X-Ray and Walk Through Metal Detector in June 2009, followed by providing an Explosive Trace Detection desktop system in July 2011, these items are currently under maintenance service agreements also.

Smiths Detection’s methodology for installation has evolved from lessons learnt at previous installations. Their submission contained a detailed methodology to minimise impact to Albury

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Airport operations, included drawings, product specifications detailing non-invasive user experience, warranty and service needs, as well as outlining their intended timeline of 127 days to meet AlburyCity’s requirements and phases of the project. The company have included an Environment, Health and Safety management system as part of their submission.

Given the highly technical nature of this equipment, the legislation requirements, and that Smiths Detection is a company based outside of the local community, there is limited direct benefit to the local economy as a result of this procurement activity beyond accommodation, meals and expenditure on incidental items by their project and servicing teams.

Figure 2. Smiths Detection (Australia) Pty Ltd equipment

User to turn/walk in circular motion during scanning.

 Body Scanner – Eqo  Carry-On Baggage Multi-View X-Ray  Doesn’t include UPS (connects to X-ray  HI-Scan 6040-2is, Includes 2.5m roller UPS) bed and UPS  Throughput: Not disclosed

Rapiscan System Pty Ltd

Rapiscan System Pty Ltd is based in the United States of America but is a global company with offices in Australia in St Leonards, NSW and a service hub based in Brisbane, QLD. The company has undertaken a number of similar projects with other airports such as QLD, QLD, Mt Isa Airport QLD, VIC and Newcastle Airport NSW. Although they detail extensive technical capability and capacity to service the needs of this project, Rapiscan System Pty Ltd is new to AlburyCity and has not previously provided equipment or maintenance support to date.

Rapiscan System Pty Ltd has current commitments at RAAF Fairbairn and Melbourne City Council with planned completion by end of 2020, and Court Services Victoria Entry Screening with in early 2021. In the period of planned installation for Albury Airport during the first quarter of 2021, Rapiscan System Pty Ltd have reported three competing priorities.

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Only one referee could provide information and indicated the company and its equipment was recommended, other written references were also supplied with their submission. The recommendations were only based on the use and experience with the Body Scanner as there were limited sites using the Multi View X-Ray unit proposed.

Their submission contained a detailed methodology to minimise impact to Albury Airport operations, included drawings, product specifications detailing a non-invasive user experience, warranty and service needs as well as outlining their intended timeline of 55 days to meet AlburyCity’s requirements and phases of the project. Rapiscan System Pty Ltd submission excluded media content and training material with the offer of a half day of training before hand over. The company have included an Environment, Health and Safety management systems as part of their submission.

Given the highly technical nature of this equipment, the legislation requirements, and that Rapiscan is a company based outside of the local community, there is limited direct local benefit to the local economy as a result of this procurement activity beyond accommodation, meals and expenditure on incidental items by their project and servicing teams.

Figure 3. Rapiscan System Pty Ltd equipment.

User to stand stationary in neutral position within Body Scanner during scanning

 Body Scanner Rohde & Schwarz QPS  Carry-On Baggage Multi-View X-Ray 201 Rapiscan 620DV  Does not include UPS  No roller beds included  Throughput: 300 passengers per hour  Doesn’t include UPS

From the information provided, all companies demonstrated their ability to provide key deliverables that are fit for purpose, the required management systems, experience, resources and product availability to provide AlburyCity with quality equipment and associated services. Based on the Qualitative scoring of the panel members, Leidos Security Detection and Automation Australia Group Pty Ltd’s submission was assessed to be the Tender of preference.

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Quantitative Assessment

The inclusive tender prices and ratings relative to the lowest price are tabulated below.

Company Estimated Contract Value (inc Rating GST) (100) Leidos Security Detection and $384,813 100 Automation Australia Group Pty Ltd Smiths Detection (Australia) $445,500 86 Pty Ltd

Rapiscan System Pty Ltd $462,501 83

Prices tendered are fully inclusive of the supply of all equipment and associated accessories, international freight, import taxes and duties, decommissioning of old equipment, installation and commissioning of new equipment, training and education of Airport staff, bi-annual service visits and technical support.

Enduring preventative maintenance costs were considered, with both Leidos Security Detection and Automation Australia Group Pty Ltd’s and Smiths Detection (Australia) Pty Ltd already having in place competitive preventative maintenance agreements at Albury Airport which will be amended to support any new equipment. Rapiscan System Pty Ltd do not have a preventative maintenance agreement with Albury Airport and would come at a cost higher than both other tenderers.

The budget allocation for the project is $405,000 including GST, with Leidos Security Detection and Automation Australia Group Pty Ltd’s submission being the only submission within the allocated budget.

Based on the Quantitative scoring, Leidos Security Detection and Automation Australia Group Pty Ltd’s submission was the most favourable from a cost perspective, being $60,687 (14%) more favourable than Smiths Detection (Australia) Pty Ltd and $77,688 (17%) more favourable than Rapiscan System Pty Ltd.

Risk

 Business Risk – Impacts from COVID-19 have shaken global supply chains resulting in increased shipping delays. All submissions requested variations to insurance liability (for instances where current policies may not respond) and inclusion of force majeure terms. Each is deemed to be low risk due to the global size of each company and the fact they are all listed on the Department of Home Affairs list of approved equipment suppliers. The specialist nature of the equipment will require investment in training to minimise risk in passenger screening during the transition period from legacy to contemporary equipment. The new equipment will require an additional security screening staff at no cost to AlburyCity.

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 Corporate Risk – Achieving proposed timeline to install the equipment and be fully operational by June 2021; this is a Commonwealth requirement. This risk area is considered low and will be closely monitored with the selected supplier.  WHS and Public Risk – Due to the installation and associated works, this will be controlled in accordance with AlburyCity WHS policies and procedures. The contractor will be WHS registered by AlburyCity and will be required to implement relevant Safe Work Method Statements and safety inspections under Airport Staff supervision. It is proposed all work will be performed in times where there will be minimal users and disruption to Airport screening access.  Environmental Risk – Nil risks identified.  Delivery Program Risk – Possible delays or installation problems could delay passenger screening or require secondary screening methods to be used. The installation for the equipment is short in duration and can be staged to occur whilst there is a lull in passenger movements. The long lead time provided to the contractor enables sufficient time to ship the equipment from overseas and process through Customs before the Commonwealth mandated date for full operational capability, therefore this risk is considered low.

Community Engagement

Communication channels included digital and print to advertise the tender and generate awareness of the upcoming changes to screening requirements as advised by the Department of Home Affairs.

The Albury Airport User Advisory Committee have monitored the progress of the tender to assist AlburyCity upon equipment installation and commissioning to communicate, create awareness and educate the community of these changes.

The preferred supplier Leidos has also agreed to supply media content that can be displayed at the Airport for use under their intellectual property licence to educate users on how their body scanner works and what users need to do to pass through screening.

Summary

The scoring for the qualitative and quantitative assessment is summarised in the following table:

Company Quantitative Qualitative Leidos Security Detection and 100 75 Automation Australia Group Pty Ltd Smiths Detection (Australia) Pty Ltd 86 72

Rapiscan System Pty Ltd 83 66

From a qualitative and quantitative perspective the submission from Leidos Security Detection and Automation Australia Group Pty Ltd was assessed as being the most advantageous.

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Their submission addressed all key assessment criteria, and their pricing was $60,687 (14%) more favourable than Smiths Detection (Australia) Pty Ltd and $77,688 (17%) more favourable than Rapiscan System Pty Ltd.

Therefore, based on the qualitative and quantitative assessments of the panel, it is deemed that the submission from Leidos Security Detection and Automation Australia Group Pty Ltd proves to be the best value for Council to deliver this project in time to meet our regulatory compliance obligations under the Aviation Transport Security Amendment (Security Controlled Airports) Regulations 2019.

Conclusion

Council invited tenders for the supply of Albury Airport Body Scanner and Multi View Baggage X-Ray Equipment and received three compliant submissions.

In May 2020 the Department of Industry, Innovation and Science granted Albury Airport $405,000 towards procuring and commissioning the enhanced screening equipment in order to meet the amended Aviation Transport Security Regulations 2005. Under the amended regulations Albury Airport will be required by law to upgrade passenger and carry-on baggage screening equipment.

All submissions were fully inclusive of the supply of all equipment and associated accessories, international freight, import taxes and duties, decommissioning of old equipment, installation and commissioning of new equipment, training and education of Airport Staff users, technical support and bi-annual service visits.

A quantitative and qualitative assessment indicated that Leidos Security Detection and Automation Australia Group Pty Ltd was the most favourable submission, providing equipment fit for purpose and of best value for Council that can be included in the current preventative maintenance program. Their tendered price of $384,813 including GST is within the budget allocation of $405,000 including GST.

Recommendation

That Council accepts the tender submission from Leidos Security Detection and Automation Australia Group Pty Ltd for Contract No.20/01572 with the inclusive project price of $384,813 including GST.

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