On October 27th Sound Transit accepted the Memorandum of Understanding (MOU) with Bellevue for East Link Construction. With Bellevue’s approval anticipated on November 14th,  including a commitment to fund up to $160m (2010 dollars) of the increased costs associated with a downtown Link tunnel, it now faces the hard part:  coming up with the money for its share.

It turns out that a lot of this money will actually be “credits” that come from waiving various payments from ST to the City,or doing things that the City would do anyway. From September 19th and October 10th staff reports to the council:  (slide version is here).

As an up-front commitment, the City will take all or a portion of the following actions to reduce Sound Transit’s costs by a minimum of $100m:

  • Providing permanent ROW easements
  • Providing temporary easements for construction staging
  • Contributing the depreciated value of city-owned utilities
  • Helping to direct conflicting private utilities to relocate
  • Contributing certain taxes received by the City as a result of the Project
  • Purchasing certain properties for the Project which may also serve other public purposes
  • Other actions that reduce Sound Transit’s costs.

The staff divided these actions into three categories, ordered from least to most painful, below the jump:

First, Categories 1 and 2, which comprise $100 million in up-front contributions.

  • No cost and low cost items totaling a Sound Transit credit value of approximately $40 million. [Up-front costs to the City would be between $0 and $8.1m.]
  • City expenditures that provide collateral benefits beyond the East Link project, totaling a Sound Transit credit value of approximately $60 million. Category 2 is comprised of property purchases, and carries a considerable up-front cost to the City of roughly $58 million. These investments are also highly leveraged, providing very tangible ancillary financial benefits to the City in addition to the East Link credit. All the property purchases are needed for City parks or transportation ROW, which the City will retain after providing needed easements to Sound Transit.

Next, Category 3, which is currently the least developed plan, provides credits of up to $60 million to Sound Transit.

  • These may include credit for the HOV lane on Bellevue Way (assumed as a$25 million City expenditure), code amendments that provide Sound Transit with greater certainty, permit processing that saves time and reduces the project schedule, clear expectations about construction mitigation, cost reductions as a result of value engineering and/or reductions in project scope, and grant funding or partnerships that provide additional funding for the Project.

The Category 3 expenditures are a “contingent contribution” and only come into play if the tunnel project expends the entire budgeted amount. Should the tunnel costs come in under projections, Bellevue will be the first entity to benefit from any savings, up to $60m.

It appears that the main effect on Bellevue’s finances will be to “crowd out” other capital improvement projects, or at least prioritize the ones that happen to sit along Link’s path, rather than impose steep new taxes or cuts to the general fund. The City developed three different revenue scenarios for its capital budget through 2030. From least optimistic to most optimistic, the scenarios assume partial to full funding for the city’s Mobility &  Infrastructure Initiative, which would fund many of the capital improvements for redevelopment in the Bel-Red Corridor.

The scenarios don’t make any assumptions about which capital projects will or won’t be funded by Bellevue’s future budgets, but the City is expected to make an update to its 2013-2019 Capital Improvement Plan next year that might incorporate the MOU’s specific upfront contributions in more detail. Right now, it seems that the biggest policy leverage Bellevue has in the MOU is to work “cooperatively” with ST through the 60% design, so the contingent contribution can be lowered.

Before that happens, however, the city council will still have to approve the full MOU as agreed upon with Sound Transit. There will be a public hearing tonight on the agreement, with large turnout expected from both sides. Bellevue residents interested in seeing the City approve its funding share should attend and speak out. You can RSVP for the hearing with TCC here.

31 Replies to “Bellevue Seeks to Fund its Share”

    1. I’m not sure why you would think that; there’s text above that directly contradicts that assertion.

      1. This statement sets the tone for the article: “It turns out that a lot of this money will actually be “credits” that come from waiving various payments from ST to the City,or doing things that the City would do anyway.”

      2. Why does it matter if money changes hands or ST’s expenses are reduced in other ways? The worst you can say is that if Bellevue was intending to do these things anyway, they shouldn’t have been listed as an expense in the first place.

      3. Yes, this post is not especially clear on what exactly is under proposal to be paid for and what the cost will be to Bellevue in cash.

      4. Part of the issue is the way ST allocates cost. They take the up front purchase price and don’t subtract anything for residual value. If they did that then B7 wouldn’t have been more expensive than the “preferred” alignment. So, if that’s they way they want to play then the City gets full credit for the value of the property (some of which rights were obtained years ago) and gets to claim it as a full contribution.

    1. Jeff, I don’t know that diamonds on Bellevue Way would be effective as a way to improve transportation. South Bellevue Way is pretty much an on-ramp for I-90, and transit already moves very efficiently along that corridor. Limiting traffic on Bellevue Way to commuters would just force more traffic into Factoria for single-occupant vehicles trying to get to I-90.

      Unless you meant that you would paint diamonds on Bellevue Way purely as a punitive measure. That would definitely work.

      Frankly, if Sound Transit were honest about reaching the maximum number of people who could walk to the train, they would be running the train along Bellevue Way. It doesn’t take a highly-paid transit analyst to realize that there is far more population along Bellevue Way than there is along 112th.

      1. @Sherwin Lee: Yes, a Bellevue Way alignment was studied… Likewise, a University Way alignment was studied for the UW tunnel. But both trains are being run along corridors with less population density than the original proposals.

        We have a pretty good indication of why the UW train is being run next to the lake: the UW didn’t want its physics building to be endangered. It’s less clear why Sound Transit decided not to run its train down Bellevue Way. We can speculate, but I doubt that Sound Transit will ever admit to its real reasons for creating a train route that goes east of its downtown Bellevue target (BTC) and has to jump back west to hit it. I don’t really believe it’s because they think people sleeping in the Hilton or under the bridges of I-405 are going to ride the train.

      2. @AP: That’s not exactly correct. The UW Physics department was worried vibrations from the trains running through a tunnel under or near the physics building would disrupt sensative research experiments. They never had concerns about the building itself.

        There are lots of reasons why trains don’t travel “obvious” alignments beyond local interests, population density, and geography. My uneducated assessment, having watched this process over the last several years, is it generally comes down to money, and a conservative transit agency.

      3. @Jack: I didn’t mean to imply that the building was in danger. You’re correct, researchers were concerned about vibrations from the train disturbing sensitive experiments.

        I’ll also agree with an elided version your second point: transit routing comes down to money. The UW has money. Residents of Bellevue Way have money. Despite what’s been written here in the past, 112th St. and Surrey Downs aren’t rich neighborhoods. The folks with money are able to dictate transit routing, such as when the Bellevue Club made sure Sound Transit would cross over to the west side of 112th so as not to disturb their tennis courts.

        No matter how feel-good it seems at times, these projects all come down to money.

      4. The EIS had the B1 (Bellevue Way) alternative with one station, 4,500 boardings in that segment, total East Link 2030 boardings 52,500, the highest of any alternative. If I could pick any alignment to be built it would be that one. Why wasn’t it selected?

        EIS comment summary:

        Over 80 comment submittals specifically opposed the Bellevue Way Alternative (B1), due to the potential high number of relocations, neighborhood impacts, impacts on businesses, and limited connections in Segment C. Over 30 submittals supported this alternative, however, because of its service to denser residential and business areas.

        There’s probably more to that than just the comments.

      5. It was also much more expenisve. From the FEIS. The B2M-C9T (current perfered alignment with tunnel) combined sections cost was estimated at $1270-1460 (millions 2007 dollars). And the Bellevue way route and tunnel, B1-C1T was $1760-2020.

        The impacts were huge, such as building a cut and cover tunnel down bellevue way from SE 3rd to NE 6th, then on 6th to the transit center. That would have caused a traffic disaster. Hence why the city was against it.

      6. Come on guys, it is not a transportation project – it is a development project.

        It is the potential density and potential development that will be supported (112th and Surrey Downs at R60 /R90 and Bel/Red), and not the existing density and development on Bellevue Way.

      7. @murrayd It would have cause a temporary traffic disaster, and as a resident of Bellevue I can tell you that Bellevue way is closed so frequently that people are used to it. Besides, by nature of the grid there are plenty of roads that parallel Bellevue way for the time that it would have to be closed for the tunnel. And yes it would have been more costly. The key is, it would actually have put a station in the middle of downtown, rather than on the edge like the 112th alignment. If you look at the 550 alignment, the stops between BTC and SBellevue P&R in downtown have very high ons/offs, clearly indicating high demand that will only grow as bellevue gets denser in the coming years. Personally, I think the 112th alignment is short-sighted, but at least it will be totally grade separated, which should improve reliability of the overall system.

      8. @Stephen

        I dont quite understand what you mean by:
        “The key is, it would actually have put a station in the middle of downtown, rather than on the edge like the 112th alignment. If you look at the 550 alignment, the stops between BTC and SBellevue P&R have very high ons/offs, clearly indicating high demand”

        The perfered alignment will have a downtown station under 110th (attached to transit center) and will also have a station at the SBellevue P&R. So both the high volume areas you speak of are being covered by this route. I agree that there is no stop directly at Bellevue Square but it will be just as close as the current transit center.

      9. @murrayd I think what Stephen means is that the B1/C1T (Bellevue Way) alignment would have a station under Bellevue Way between Main and NE 2nd (“Old Bellevue”), versus the Preferred Alignment’s station at 112th NE and Main. C1T would also have built the transit center station under the existing transit center and not under 110th NE between NE 4th and NE 6th. As Oran pointed out, per the FEIS B1/C1T had the highest ridership projections of any alignment, but would’ve been the most expensive alignment by far (interestingly, B1 was the cheapest of the B segment alternatives, but C1T was the most expensive C segment alternative by a lot)

  1. Is Seattle paying for any of the A segment between IDS and Rainier Station? I can’t find anything on ST’s website, but it seems like they should at least be on the hook for all or part of it, as it’s entirely within the city limits and will mostly will serve their citizens to make connections to/from Rainier.

    1. and will mostly will serve their citizens to make connections to/from Rainier.

      Sorry, what?

      Let’s imagine a world in which segment A wasn’t built, and East Link terminated at Rainier.

      For Seattle residents, this is a bit annoying, but whatever. Most Seattle transit trips are to places other than the Eastside. This wouldn’t be such a big deal.

      But for Eastside residents, this would be devastating. Not having direct service to downtown would pretty much invalidate the entire point of East Link.

      It’s simply beyond argument that the segment between IDS and Rainier is more valuable to Eastside residents than Seattle residents.

      1. I-90 is pretty full going both directions in the AM/PM commute. It’s a bit smug to say only one end of the pipeline should get tagged for all the costs.
        Anyway, all the deals have been cut, so what I think doesn’t change anything. Just wondering who’s paying for what, which is where this post started.

      2. I was responding to your assertion that the “primary” purpose of the segment connecting Mercer to downtown was to serve Seattle residents.

      1. How much does that segment cost? $150 million? If any of that is Seattle money, then I vote that Seattle withdraws our participation and instead keeps it as a down payment on an infinitely more useful (to us) Ballard-UW spur.

      2. I disagree with Aleks.

        $150 million won’t do much to get to Ballard via light rail.

        There are plenty of blue-collar neighborhoods with faster access to the eastside thanks to the Rainier/I-90 station. And including these neighborhoods will give the line a better shot at federal funds.

  2. Seattle has gotten substantial federal subsidy for its portion of Link. That is a result of politicians representing Seattle doing the legwork to get federal funds.

    If Bellevue politicians put the effort into seeking federal funding, they might get some. (The same goes for the Federal Way johnny-come-latelies who have run out in front of the Link bandwagon after not doing anything to get it going.)

    1. An interesting question is should Bellevue get some sort of matching federal funds would it be used as credit toward the MOU?

  3. City of Bellevue will be discussing on Monday night (again). Some Council members are now trying to re-negotiate the City commitment.
    Will be interesting to see if that floats.

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