Compared to expectations in 2016, capital costs are likely to be much higher as inflation in capital expenditures and right of way acquisition have run far ahead of general inflation (image: Sound Transit)

By the time most ST3 projects are delivered in the mid-2030s, Sound Transit is projected to accumulate over $17 billion in debt. Managing that debt load is critical to delivering the program on time.

Sound Transit’s debt capacity is limited in several ways. There is a statutory limit that total debt cannot exceed 1.5% of the property tax base within the RTA district. There are other constraints, contained within financial policies and bond covenants, that limit bond servicing costs relative to available cash flow. Sound Transit monitors all of these so the future debt load remains financially sustainable and within legal limits. If future projections indicated any of these limits would be exceeded, it would become necessary to delay projects or reduce operations.

The analysis that informed the development of the ST3 program in 2016 suggested a prudently low risk of breaching the statutory debt limits. Other risks relating to bond servicing costs appeared near zero. A recent analysis shows appreciably larger risks on all dimensions. Estimates for costs and revenues have increased since the 2016 projections, but the increase in costs is outpacing revenues. The capital program remains affordable at this time, but the margin of error has narrowed.

One way to think about risks is to recognize how every component of the 25-year forecasts has a range of uncertainty. Three years into the ST3 program, we know more than we did in 2016 and that narrows the range of estimates. But estimates through 2041 can still change by billions of dollars in a year. It’s not a question of whether Sound Transit is on target (the median estimate still says yes), but how likely Sound Transit is to end up in the unhappy tail of the distribution of possible outcomes.

There are three key metrics to watch:

Legal limits on debt: Sound Transit faces a statutory limit that non-voted debt must not exceed 1.5% of the assessed value of property within the RTA, unless approved by 60% of voters. Earlier projections were for a ‘pinch point’ in the early 2030s as several major projects are completed about the same time. The more recent analysis shows a more extended window of elevated risks, though the probability Sound Transit would get too close to the limit remains under 20%.

Risks of exceeding the statutory limit remain manageable, but are significantly higher than estimated in 2016 (image: Sound Transit)

More early risk is worrying as it leaves less time to react. In a recession, we could see more debt and a lower ceiling because the statutory cap is tied to property valuations which would fall. Projections in 2018 showed that even a small near-term recession could place Sound Transit on a lower trajectory that breaches the debt limit later in the program.

Financial Policy: Sound Transit’s financial policies specify revenues should cover operating costs plus debt servicing 1.5 times (net coverage ratio). This ensures enough cash to meet bond commitments and to operate the trains and buses. While it’s possible to alter this policy, too low a net coverage ratio would signal higher risk to the bond markets, raising Sound Transit’s cost of cost of borrowing.

Above inflation growth in operations costs mean much higher risk of exceeding the allowed net coverage ratio (image: Sound Transit)

The net coverage ratio has been under pressure because operating costs are growing ahead of inflation. Just in the Fall 2018 update to the financial plan, Sound Transit added $2.1 billion in expected operating costs. Two-thirds of the increase in forecast operating costs is in services bought from other providers, and makes clear why Sound Transit went looking for cheaper alternatives to relying on the local agencies.

Unlike most capital costs, operating costs are forever, so the management challenge extends beyond the life of the ST3 program. As major projects are completed, operations and state-of-good-repair costs grow steadily as a share of tax revenues. The recent analysis indicates risks to the net coverage ratio policy grow continuously over the life of the program, reaching 49% by 2041, the last year in the analysis.

Debt Covenants: Sound Transit’s bond agreements require revenues to cover bond debt servicing at least 1.6 times (gross coverage ratio). This measure too shows increased risks over the entire program window, though less than the net coverage measure because gross coverage doesn’t include operating costs where much of the downside risk lies. Bond holders don’t need to worry about operations because they get paid first.

Risk of breaching bond covenants have increased in the outer years of the program (image: Sound Transit)

The analysis considers only forecast risk. It does not include large external events such as passage of I-976 that would push the ST3 plan far off course, or a major change in future federal grant policies. It does clarify the caution regularly expressed by suburban board members about scope creep in Seattle, and their insistence on identifying third-party funding soon. Cost discipline in the next few years remains essential to delivering projects on schedule in the 2030s.

57 Replies to “Financial risks to the ST3 plan have grown”

      1. Can you two explain the “[ot]” et al brackets thing? I feel like I missed the boat and I’ve seen it a few times now here

  1. Hopefully if it comes to cutbacks they start where the demand and public support is lowest. I also hope the city of Seattle can step-up and make sure their portion is fully funded.

  2. This is why the order of our projects is wrong. The best way to do it is from the middle, out. In our case, we would start with the shortest, highest ridership section. U-District to downtown Seattle (with a stop at First Hill) would do that. You would probably have about 80,000 or so riders by now, with a lot less rail (i. e. much smaller maintenance costs). Then expand up to Northgate, and down to Rainier Valley. While Rainier Valley doesn’t get a huge number of riders, the riders per mile (i. e. riders per hour of service) is pretty good and it didn’t cost that much to build it. Then expand to the East Side, followed by another line or two inside the city. Ballard to UW or a Metro 8 subway are both pretty short, but long enough to get lots of riders (again, great ridership per hour of service). They also aren’t super expensive from a construction standpoint (for the same reason).

    Only after you’ve done a good job covering the core city should you expand to the suburbs. That is because without that, suburban ridership will struggle. We aren’t Calgary — not all of our jobs are in one little line downtown. The ability to get to places like First Hill, Belltown, South Lake Union, Lower Queen Anne and even Fremont or Ballard make a big difference for suburban riders, not just urban ones. So something like Lynnwood — where you have an outstanding bus intercept — is great, but could benefit from better service within the city. It is highly unlikely that you’ll gain much by going further north, but in some cases it could pay off.

    Unfortunately, that isn’t how we are doing it. My understanding — and someone can correct me — is that with ST3, ridership per mile will actually go down. That is shocking, really, and a sign that things are out of whack. Ridership per mile should go up steadily every time you expand. But the network effect doesn’t overcome the terminus effect. In other words, for every rider that loves their new fast trip from Ash Way to North Shoreline, there are riders who simply switch to a different stop. Instead of taking a bus to Lynnwood, they take a bus to Ash Way. Costs go up (more trains, more miles of track to maintain, more drivers) but fare recovery doesn’t go up as much.

    This is not in the least bit surprising. Folks like d. p. predicted it a long time ago. I’m not saying that ST will have a problem with ST3 (and not be able to fund it) but the approach they are taking is riskier, and ultimately leads to a system that has far fewer riders per dollar spent.

    1. Ballard -> UW, an 8 line, East Link, and Northgate, all before Seatac? How do you expect to get Snohomish, Pierce or South King support for a plan like that? Your plan literally puts zero track in three subareas.

      ST1 really tried to have it your way. South King -> Downtown ridership estimates were higher than reality. Westlake -> Seatac was thought to be where the money was.

      Things change. Nobody was predicting the dominance of UW -> Westlake. Ridership in this region changes much faster than Link can build. ST1 was when we as transit advocates learned you truly can’t build with today’s ridership levels in mind.

      1. Ballard -> UW, an 8 line, East Link, and Northgate, all before Seatac? How do you expect to get Snohomish, Pierce or South King support for a plan like that?

        I don’t. King County would pay for all of it. With subarea equity, that is the way it works anyway.

        You could still have ST, but initially they would be adding bus service that crosses county borders (something that is needed and something they have done for a long time). Once the central city has a decent subway, then you start discussing whether it is worth building out further, beyond the county border. Maybe it is, maybe it isn’t.

        Nobody was predicting the dominance of UW -> Westlake.

        You are completely wrong. 100%. Sorry, but everyone who knew anything about transit knew that was the dominant section. It is pretty obvious. Density plus proximity equals ridership. UW to downtown has both (and this is even without the extra stations that most agencies would have added between there). Even some of the ST leadership understood this. When the original plans ran into deep cost overruns, some on the board wanted to build the northern section, while others wanted the southern section. ( Here is a key quote from that article:

        Dave Earling, chairman of the Sound Transit board, is pushing for a light-rail alternative that runs from Capitol Hill to Henderson Street and would carry about 60,000 passengers daily. “This is clearly the one that offers the highest ridership,” he said.

        Everyone understood that ridership was going to be higher to the north. But for political reasons, folks wanted to build the southern part next. To be fair, one good reason was that it was easier — less risk — for an agency that had lost all credibility. Build something — anything — just to prove you can. Another was their asinine fixation on “The Spine”. Had they thrown that away — instead of the stop at First Hill — then the system would be much better. Those in the city would be better off, and those in the suburbs would be better off.

        Again, all of this is obvious to anyone who has ever studied other transit system (in this country or others). Building long, stringy subways to low density suburbs — or low density cities — just doesn’t work. Oh, you might get some riders, but not nearly as many as if you build a system focused first and foremost on the urban center.

      2. “Nobody was predicting the dominance of UW -> Westlake”

        lol anyone with a brain was definitely predicting that. Also I’m pretty sure Seattle already pays for their own lines, hence subarea equity, so there’s no need for Snohomish and Pierce to sign on to anything. Seattle is held back by their unwillingness to fully fund transit, not the other way around. What world are you living in?

      3. I’m going to pile on here, since I believe you’ve repeated this point multiple times now:

        Nobody was predicting the dominance of UW -> Westlake.

        Literally anybody with any familiarity with transit use in Seattle or familiarity with any city that has a high transit mode share (e.g. Chicago or NYC) knew where light rail ridership would be highest. Transit use dominates when it provides high frequency service between areas with lots of destinations (residential + commercial/educational/government) within the station walkshed.

      4. Ross, the point of reaching Tacoma is not so much for Seattle (that’s probably a B or C priority) it’s to connect with firstly the airport as it’s a major jobs center for South King. I know because I’ve ridden the 574 and it’s usually pretty packed to the brim with passengers, airport workers, airline employees, etc. Connecting Tacoma to SEA by light rail is invaluable to long term economic growth that the city of Tacoma is in need for to help revive their downtown that has been in a state of purgatory since Russell moved to Seattle. There’s also connecting to Federal Way and Kent/Des Moines which is currently slow and infrequent either with the 574 being half hourly and 500/501 taking a long meandering routes to get to Fed Way. And is terrible during rush hour where it mostly slows to a crawl. It would relieve the A line to a degree with how many people connecting between Fed Way-Highline College-SeaTac-Tukwila/INT Blvd

        I get that you really want Seattle to have the best subway system it can, but what you’re asking is maybe out of scope for the kind of organization ST is. At the end of the day ST is a multi county regional organization that has to balance keeping all parties happy and valued to being part of the district. If you want yer subway, go petition the legislature to change the rules so Seattle can go do it’s own thing within the city of Seattle for itself.

      5. Ross, the point of reaching Tacoma is not so much for Seattle (that’s probably a B or C priority) it’s to connect with firstly the airport as it’s a major jobs center for South King.

        I’ve read that idea before, but I’m sorry, that is crazy. Tacoma is not a large city. It is not densely populated. In fact, it is surprising how low the density is, given its charm (and I mean that sincerely). I have visited Tacoma many times over the years — I have relatives and friends there. It is a great place. It just isn’t a major city, with the density that can support rail. It’s downtown does not have a huge concentration of jobs, and furthermore, the train won’t even serve it! It will go to the outskirts, in an area that is practically deserted, but happens to be next to a Dome that is empty more often than not. (Side note: my cousin used to live up the street — the area has some character, I’ll give you that — it just doesn’t have a lot of people or jobs).

        You will be hard pressed to find any city its size spending money building a subway line, whether it includes a trip to the airport or not. The 574, since you brought it up, carries 2,200 people a day. There are literally dozens of routes within King County that have more riders — none of which will be turned into rail lines. The 574 should run more often. But running a bus more often is a lot cheaper than building — and operating — a rail line.

        References: Population Density Map:
        Employment Density Map:
        (It is a little tricky to use the employment density map. First you do a search. I suggest Seattle. Then pick the Seattle-Bellevue-Tacoma CBSA. You can then see where jobs are concentrated.

      6. “I’ve read that idea before, but I’m sorry, that is crazy”

        The statement is about people’s priorities, why they made the decision, not about how effective it will be. Although I don’t think that’s quite the reason. Commuting to Seattle and commuting to the airport are both secondary benefits. They’re primary to some voters, but what the city of Tacoma and Snohomish officials have articulated is that they see Link as essential for attracting companies and jobs to their cities. One of the first things large companies ask is whether it has high-capacity transit, and second whether it goes to the airport. The region is evolving long-term into cities of Link-haves and Link have-nots. The cities without are afraid they’ll be left behind economically as middle-class jobs and residents shun them because they don’t have a 10-minute train like other cities in the region have. At the extreme they could become the next slums. No matter what you say, people perceive Link as being more convenient. They don’t really believe that buses will be as frequent or reliable because they’ve seen it fail time and time again. Plus Link will be a one-seat ride or train-to-train transfer to many more places than a bus route goes.

        The Tacoma situation is a bit strange because Link will only reach the nearest corner of it, a corner where nobody lives. That’s like saying UW Station or the former 26/28 in Fremont “serve” North Seattle. Their ultimate goal is to extend it to Tacoma Mall. Then the mall district and dome district can become urban villages and people will move there, and they’ll become a larger percent of the city’s population. That’s the theory at least. Whether it will be effective is another question. We’ve warned them repeatedly that a 60-minute travel time will only take them to Beacon Hill. They’re not too concerned about that, and they believe that the deteriorating travel time on I-5 will reach that anyway.

      7. The statement is about people’s priorities, why they made the decision, not about how effective it will be.

        what the city of Tacoma and Snohomish officials have articulated is that they see Link as essential for attracting companies and jobs to their cities.

        Fair enough. What I’m saying is that those officials are crazy. It won’t work.
        Both cities are too far away to be edge cities for Seattle and spending money on a line like Link is an enormous waste. It will only serve a tiny fraction of the city — it won’t radiate out, the way a normal subway would. As you mentioned, it doesn’t even go to downtown Tacoma. It would be like Seattle running a line from SoDo (our least popular station by ridership) to the airport. Except instead of having a half dozen or so stops in the city, it immediately serves a couple stops (East Tacoma and Fife) right by the freeway. It bears no resemblance to the population density in Tacoma — past, present or future. It is suburban in nature — for the entire line in Pierce County. Meanwhile, Tacoma itself suffers with inadequate transit.

        One of the first things large companies ask is whether it has high-capacity transit, and second whether it goes to the airport.

        No, what companies ask is whether there is a workforce that wants to work there. Transit is simply one part of it. Besides, the argument seems ridiculous. “Oh yes, we have a light rail train. It is shiny and blue. It doesn’t serve downtown, or any of the universities, or the most popular neighborhoods, but hey, it does go to the airport and Fife”

        Speaking of the airport, it is worth noting that SeaTac is connected to downtown Seattle. You can quickly and frequently get from the airport to any of four stops in downtown. Yet only around 6,000 people a day do that. It is hard to see why a business would care. If you look at the fastest growing cities, it hardly seems to matter. Charlotte, Austin, and San Antonio don’t have subways to the airport — I’m sure we would be fine without it. What they all have is great universities.

        This is where both Tacoma and Everett are on the right track, but it remains to be seen if there proximity to Seattle will help or hurt them. If you graduate from say, the University of Utah, then there is a good chance you will settle in Salt Lake City. If you graduate from a college in Tacoma or Everett, you may stick around, or you may just move to the big city, which is not far away. That decision will have little do with Link, and more to do with other factors (like whether the downtown is attractive).

        The plans for Everett are much better. It really does look like something Everett itself would build — there are plenty of trips that have nothing to do with Seattle. The problem is that it is way out of proportion to the city. Everett is pretty tiny, and doesn’t need a train of that magnitude. Swift is the right idea — it is more than big enough to handle the load. But like Tacoma, Everett’s fortune will likely depend on other decisions it makes — how it transitions from having one main industry (the military or Boeing, respectively) to something more diverse and lucrative.

    2. “Nobody was predicting the dominance of UW -> Westlake.”

      Everybody knew it. The 71/72/73X were melting down with overcrowding and unreliability in spite of running every seven minutes, and the overflow spread to all of the 43, 49, and 70, and even routes like the 255 (Montlake freeway station). The U-District has more routes from everywhere than anywhere except downtown, and some people can transfer downtown and take a more-reliable Link to the U-District than the previous direct buses were.

      The sleeper hit was Capitol Hill. I knew abstractly that Capitol Hill-UW would be one of my primary trips, but I didn’t understand the full implications of it until after it opened. While the 49 is still better for northern Broadway to the northern U-District, the fact that we now have effectively a 43X blows the previous service out of the water, and is much better than walking down to Convention Place across that horrid freeway to the 71/72/73X and never knowing whether your bus will be 5 minutes late or 20 minutes late or whether you can even get on because it’s so full.

      On top of that are people going to Seattle Central and Seattle U, and making lots of urban trips to Capitol Hill like they do in New York — a phenomenon you don’t see as much in less urban places like Rainier Valley or West Seattle or the suburbs, where there are fewer things to go to and people don’t travel as much and are more likely to take a car.

      The estimate is correct that downtown-UDistict is highest, and downtown to Northgate and Bellevue will be second-highest. Lynnwood, SeaTac, and south King County will be third, and Everett and Pierce County fourth. With the important caveat that dozens of buses will be truncated in Lynnwood, and that will allow it to punch above its weight. That could put Lynnwood in the second tier, but I’m betting that Bellevue as the larger city will eventually win out, especially with the Redmond and Spring District jobs in addition to it. I don’t have as good a feel for Ballard and West Seattle so I’m not sure which tier to put them in. But over the course of ST1/2/3 we’ll see the greatest ridership per mile increase from the end of ST1 (U-Link) through the end of ST2 (Lynnwood and Sounder South), and then — ignoring the hard-to-place Ballard and West Seattle — diminishing returns for the rest of it. That can well raise questions in people’s mind of why we’re building the Everett and Tacoma extensions. There is an alternative, which is what we would have gotten if ST3 hadn’t passed: frequent ST Express feeders to Lynnwood and Kent-Des Moines.

      Yes of course, subarea equity wouldn’t allow Ballard and West Seattle and DSTT2 without Everett, Paine Field, Tacoma, and Issaquah. But that shows the flaws in the subarea equity model. The reason Seattle couldn’t build them on its own or a Metro 8 line is because the state would only allow a significant tax increase for Sound Transit, not for Seattle or Metro, so we had to play by the subarea equity rules, most particularly a common tax rate across all subareas. If North King could have charged more and Pierce and Snohomish less, then they could have gotten lower taxes in return for their lesser willingness to use transit. But Snohomish really wanted Everett and Paine Field, and that cost as much proportionally as Ballard (which was after West Seattle in ST’s priorities even though it will generate more ridership and be more justified), so that’s how we ended up with ST3 the size it is and with the projects it has. Snohomish and Pierce are pushing for Link not primarily as a way to commute to Seattle, but to attract companies and jobs to their own cities, to increase their tax base and make it so their residents don’t have to commute to King County as much.

      1. And the new transit market of Lynnwood to north Seattle, which is not very well served now. People in Snohomish work in Ballard, Northgate, Licton Springs, and northeast Seattle, and the express buses don’t work for those at all. They bypass Northgate, 145th doesn’t have any continuing buses except a slow one to Northgate, and the freeway traffic at 45th combined with the slow 44 make it an unappealing alternative. But with Link, suddenly these areas and Roosevelt/Greenlake become a lot more accessible. Like what asdf2 said about Capitol Hill. He used to live north of U Village and said that when U-Link opened, suddenly it was much easier to pop down to Capitol Hill for lunch or stopover there on the way to somewhere further south, and that’s new ridership. I expect the same between south Snohomish and north Seattle. And I forgot about it in my estimate of Lynnwood above. All latitudes of north Seattle will be within a 20-minute Link ride of Lynnwood. That’s a big deal.

      2. I lived on the 72 route line for a significant amount of time. I was riding UW busses since before there was a DSTT or a 71/72/73, when your options were the 70 and 74. You are vastly overstating the crowding and timeliness issues, even during peak hours. Even at its worst, UW express crowding and timeliness issues were paltry compared to other regions. 174s were often over 40 minutes late, even off peak.

        The reason you don’t see these urban trips in the Rainier Valley or South King is because the transit is for crap. There are reasons to make more urban trips in the Rainier Valley today. Pho that makes Ba Bar taste like dirty dishwater. Boutique clothing shops.
        Fantastic farmer’s markets. All the tourist kitsch and glitz on Cap Hill exists in the Rainier Valley and South King.

        Walking across a freeway is horrid? Seriously? Let me grasp my urban pearls as I perish from the mere thought. I walk across that freeway regularly. It is a better walk than most bridges in the region. Let me guess. The AWV was also “horrid” to walk under, despite the fact that tens of thousands of people did it every day on the biggest WSFS route in the state (Bainbridge -> Seattle, maximum 2,200 passengers per trip) without any issues, much less anyone suffering from the clearly traumatic experience.

      3. The sleeper hit was Capitol Hill.

        Sorry Mike, everyone predicted that as well. Again, this is standard, run-of-the-mill stuff. I realize this isn’t obvious. That is the problem. I made the same mistake initially as well. Maybe because we all have experience on the roads, whether in buses or in cars. We tend to focus on the long trips, not the short one. But the fact remains that people who really understand transit — who can describe, in detail, systems across the country from memory — knew that Capitol Hill would be a very good station. It just checks off all of the boxes. It is right in the heart of the city. It is in a vibrant, interesting area, with shops, restaurants, bars and nightlife. It is full of people, in every direction. It lies between the very urban University of Washington and downtown Seattle. Of course ridership is high. Ridership will grow substantially as they build to the north. Ridership for this section would be even higher if they had added the First Hill stop or a stop at 23rd and Madison.

        Again, this is standard stuff. I can’t find a link, but I remember reading somewhere that the stretch between the UW and downtown Seattle (including Capitol Hill) was the most densely populated corridor without a rail line in the country. I don’t know if that was true, but it sounds reasonable. So of course it would carry lots of riders.

        I remember one of the early quotes when someone rode the train from the UW to Capitol Hill. They said, basically “Wow! That was fast!”. My attitude was “Duh — do the math”. Seriously, read a map. It isn’t that far. The train really isn’t going that fast. It is just that compared to driving, or walking, or taking a bus, or biking — it is blazing fast. That is the nature of an urban subway. That is why it gets lots of riders. Trips that previously seem like a big pain in the ass (too far to walk, a slog of a drive, worse yet with the bus stuck in traffic) suddenly seem magical.

      4. “Even at its worst, UW express crowding and timeliness issues were paltry compared to other regions.”

        You had the express lanes. I was going reverse peak. I wasn’t comparing it to suburban expresses with long freeway segments; I was comparing it to other Seattle routes. The E is the closest comparable one.

      5. The 174 had no freeway segments. The 70 and 74 didn’t use the express lanes. The 71/72/73 haven’t always used the express lanes.

        I’m not sure what you were trying to say with your post, so I can’t refute it more.

      6. The express lanes bypass most of the freeway traffic because 520 doesn’t connect to them. When I-5 and 520 were built in the 1960s they didn’t anticipate how much the Eastside would grow, and all that traffic dumps onto the regular lanes which are already congested, while the express lanes whizz past them. Northbound buses used Eastlake in the AM peak, the regular freeway in the late morning, and Eastlake in the afternoon. Southbound buses always used Eastlake except in the AM peak. The regular freeway and the 45th exit were on-and-off bottlenecks a few times a week for northbound buses. Eastlake bogs down during peak, and a southbound bus gets caught in the Stewart-Denny traffic that stretched a 25-minute trip to 45 minutes a couple times a week and over an hour at least twice a month. So if you lived on the 72 and mostly took it peak direction, you wouldn’t see most of the problems.

      7. A Joy: It’s not so much the bridge over I-5 itself (great views of Mount Rainier from that bridge) as the crossing of 5th Ave NE, 7th Ave NE, and 45st itself that is the issue. Transferring from Metro 44 eastbound to the northbound “Freeway Station” busses requires walking *in between* lanes of heavy car traffic with your back faced to the cars. Just doesn’t feel safe to me.

    3. GIVE. IT. UP, Ross. That ship has sailed. All you’re doing is providing talking points to the Link haters.

      Also, you have a static view of the region. In the past two decades its population has roughly doubled, and Seattle has grown more rapidly than the overall average. You think that overall growth will come to a screeching halt tomorrow? It will not. There will be more apartments, condos and townhouses all along Link. But absent major upzones in “marginal” areas — your scorned “West Woodland”, Aurora north of 85th, Rainier between Jackson and MBS, Lake City and Delridge — Seattle’s growth will slow. There’s no more room in SLU, the Central District or even the International District. They’re all mostly built-out and the SFH zones are not going to be broken open. There are at least four closet NIMBY’s in the City Council run-off. Several will win.

      It’s increasingly clear that Sound Transit won’t build a Metro 8 or Ballard-UW because they aren’t “regional” as it defines the term. “It” as in the Sound Transit Board whose majority last time I looked is pretty “suburban”.

      The legislature seems entirely unwilling to give Seattle or even King County extra tax authority so Sound Transit is the one and only way to get rail transit built in the region.

      Deal with it.

      1. Ross,

        Apologies for the harsh tone. I agree with you that inner city subways would be more cost-effective than long suburban “commuter” rail lines which is what the Spine north of Northgate and south of Sea-Tac largely is. They’d carry more passengers for (probably) less money. But, again, that ship has sailed. The system that the Legislature authorized will be built and little if anything more.

      2. Yeah, I’m well aware that for the most part, the ship has sailed. But I think it is important that folks understand the mistakes that we’ve made, because, again, they aren’t obvious. The fact that some are still arguing otherwise — that UW-Capitol Hill-Downtown is surprisingly busy — suggests that a lot of people just don’t understand how transit works. Without a doubt an urban system would be a better value — it always is.

        As for the city changing, it has changed in ways that support my case, not diminish it. Even if Tacoma grew like crazy it would be tough to make the spine work. Dallas-Fort Worth is a major metropolis and each city is huge (Dallas is 1.2 million, Fort Worth 850,000). But there just isn’t the density to support a subway of that length. As a result, DART struggles. So even if Tacoma doubled, or tripled in size (almost catching up to Seattle) it still would be a tough project to pull off.

        But that hasn’t happened. Tacoma — for all its charms — hasn’t grown much. Neither has Everett. Neither have the suburbs. But Seattle proper has grown like crazy *despite* very restrictive zoning laws. Those laws — for all their flaws — have concentrated the growth into a handful of areas. In other words, most of the growth over the last 20 years has occurred in Seattle, in areas that could be served very well by mass transit (if we were willing to invest in it).

        But like you said, that isn’t likely to happen. In all likelihood, this is it. That is the other lessen. As much as Keith Kyle and his friends at Seattle Subway think otherwise, this is pretty much it. Oh, it’s possible we will add a little thing here or there (which is why I still push for Ballard to UW) but it is quite possible we won’t get that. We certainly won’t get an Aurora Link, or an extension of the West Seattle line (which itself is dubious). This excellent post demonstrates that. This stuff is very expensive — both to build and maintain. Eventually, every city basically says enough, and spends money on other things (police, health, human services or just maintaining the huge system that exists).

        Yet we still have folks who think we can just keep building. For the most part, these ideas are academic. Arguing about Aurora Link, a chunnel to Kirkland, or a Georgetown bypass to SeaTac is like arguing who the Sonics should draft next year. It isn’t going to happen. But there are still important decisions that assume endless, wasteful growth. An example of this is in West Seattle. There is a serious proposal being studied (by professionals who are paid to study such things) whose only advantage over the representative project is that it can more easily be expanded south. The proposal would wipe out more homes, and cost more money. When I say “wipe out”, I don’t mean that the neighborhood will be upzoned. No, I mean that ST will literally take their homes. Yes, that is the way this works, and the assumption is that it is for the greater good. But when there is no greater good — when it will never be expanded because nothing to the south will ever have the density necessary to justify an extension (while plenty of places in other parts of the city do) it is just cold blooded and stupid.

    4. Ross –
      You’re forgetting why Sound Transit was created. It was created to provide regional rail service and regional bus service. The scenarios you are talking about aren’t going to happen. The emergence of the ‘Seattle Subway’ group has given the impression that Sound Transit is really ‘Seattle Transit’ and their purpose is to build a full-fledged NYC style subway system. That’s simply not going to happen. The era of pervasive subway systems has passed, for a number of reasons. The NYC subway system was built before cars were even invented.

      Link’s identity is a bit confused. Is it a urban rapid transit system or is it a suburban commuter rail system? It’s a little of both. But it’s unclear how you start with an empty train in Tacoma or Everett and then commute all the way to Seattle without blowing out the capacity of the trains. I haven’t seen any ridership studies that even begin that conversation.

      Don’t forget that Sound Transit is a tri-county agency. With the subareas, it behave financially as 5 agencies. None of this serves Seattle that well but as you say, there are many more destinations than just downtown Seattle today.

      1. Has anyone told the rest of the world that the era of pervasive subway systems has passed? China seems to have not gotten the memo.

      2. Yes, you are describing the problem. What we have is a regional transit agency, but what we need is an urban transit agency.

  3. [ot]

    My own preoccupation would be with concentrating on how many risk factors we can control, literally day-to-day as work progresses. Also, at every stage, and for every move, have a fall-back.

    Would’ve been good to have guaranteed DSTT bus service as long as we needed it, instead of on the say-so of the Convention Center project. Which would, however, have required some attention to the quality of joint-use itself throughout the prior lifespan of the Tunnel.

    “Could” doesn’t mean “be timid”. It means “be ready.”

    Mark Dublin

  4. Dan —

    Any word on when Sound Transit finally will produce and disclose the kind of financial plan the ST3 measure requires?

    That kind of financial plan voters required as part of ST3 will show how much projected revenue and debt capacity all the subareas will have. Staff and the board need that information now, as they scope projects for EIS submissions and plan for allocating debt sale proceeds among the subareas. The public needs those financial plan data to verify the board is planning to spend enough in each subarea, and to make sure King Co.’s appointees don’t pirate projected revenues that should be allocated to the small subareas.

    And before TSWIGM jumps in with a reply — no, the table of subarea expenses and revenues information on page 81 of the 2019 budget document isn’t close to what those ST3 financial policies require.

  5. Curiously, this still doesn’t include the 30 percent contingency recommended by FTA (ST appears to have used 10 percent).

    My prediction is that end-of-line stations will be dropped from ST3 or a major shift in Federal funding and financing will occur by 2028 or an ST4 is approved. Embracing more expensive tunnels to West Seattle and Ballard just makes it more tempting to drop them due to lack of financing or funding.

  6. Excellent piece! Thanks for posting this, Dan. I think the second risk you’ve highlighted, i.e., the net coverage ratio, is one that hasn’t been discussed all that much even though it ultimately could present the biggest ongoing financial challenge for the agency long term.

    (Fwiw….I have no idea what Gerry D is alluding to if his comment above is being directed toward me. Since I never made such an assertion, it’s nothing more than a straw man argument. With that being said, I too have issues with what ST is now putting out as its annual financial plan. )

    1. Agree, (and this was called out in the ST meeting where these materials were shared too, I think by Paul Roberts). We’re accustomed to thinking about the statutory debt limit as being the only limit that mattered in practice. But the pace of operations cost growth brings the net coverage ratio into play.

      1. Can’t ST hive a bunch of its Express operations off onto Metro? Just because Federal Way and Bellevue are both “regional centers” doesn’t mean ST has to run a bus between them, does it? Why do both ST and Metro run buses between Redmond and UW? Between Bothell and Seattle? I thought that STEX was envisioned to be “interim”.

        So, if ST gets in a tight it seems likely that it will just cut a bunch of Express service and assume the county agencies will pick up the slack.

      2. Yeah, I agree, Tom. It doesn’t make sense for ST to spend a bunch of money on express service *within one county* if money is tight.

        The problem is, pretty soon this won’t be an issue. They will be spending money on trains, “BRT” and buses that go from county to county. Killing off the 522 BRT plans, for example, would be a horrible bait and switch for the folks in the northern suburbs (Bothell, Kenmore, etc.). There is so much fanfare surrounding that bus service, that they pretty much have to run it. The 405 BRT buses really do cross county lines, and those have the same issue. But mostly, eventually, you have train service. Would it shock anyone if Issaquah to Bellevue only runs every 20 minutes, like similar lines? Or how about the northern and southern parts of the “spine”. Those are very expensive to operate, and most agencies — even ones in cities that are doing just fine — have cut back on service like that (Denver is a recent example — I’m not saying any of this will happen. It is quite likely that ST will have enough money to operate things — or decide to delay projects instead — but it wouldn’t be shocking if train service, or less popular ST express service between counties is cut.

      3. “Can’t ST hive a bunch of its Express operations off onto Metro?”

        It already does. ST doesn’t operate any buses. Metro and PT run the King County ones. (PT because its costs are lower.)

        ST’s preliminary plans for ST2 ST Express in ST2 truncated everything into feeders. This was superceded by ST3 but it shows ST’s long-term direction as of 2016.

        Metro’s 2025 plan takes over the 574 when ST abandons it. The 578 is replaced by a Seattle-Kent-Auburn express. RossB’s UW-520-405-Woodinville route is also there, as is a Cherry Hill-Lake City-Woodinville express. These are nominally half-hourly expresses although some of them may end up being peak only. These are currently unfunded; the countywide Metro measure in 2020-1 is supposed to fund them. That may be difficult to pass given that the last two have failed, but it’s what we have now.

        As to why the ST and Metro express corridors seem to be arbitrary and overlapping, I think the 550 and 545 exist as a precursor to East Link. Kirkland has no ST service to downtown because its long-term HCT role was unclear in 1996 and 2008; that was left to be decided sometime after East Link. ST is thinking not just inter-county but inter-subarea. I think all ST Express routes cross subareas. The future feeders won’t, but they’re extensions of the multi-subarea Link system.

        The 522 overlaps with the 312; the 554 overlaps with the 218; the 577/578 overlap with the 17x; the 51x overlap with the 4xx; because ST Express doesn’t have the capacity to meet all peak demand. It’s budgeted primarily as a baseline all-day service, and some of its routes are more limited-stop than express. The 512 and 574 are limited-stop; the 522 and 550 partly are. In contrast the 577 is a true express, and the 578 stops once per city I think. The reasoning boils down to interim service in future Link/BRT corridors, and what the subareas’ priorities are.

  7. Excellent analysis, Dan, and thank you.

    The wording of “an I-976 defeat that would push the ST3 plan far off course” makes it sound like rejecting I-976 would push the ST3 plan off course, when it’s “an I-976 approval” that would.

    I expect that ST will make cuts to elements of upcoming expansions, as their short-sighted Board continues to reject funding for big impact items such as the completion of the northbound direct access ramps at 164th in favor of funding similar in cost local, single modal benefit projects, e.g. bicycle lanes, of powerful, individual Boardmembers’ jurisdictions for a comparatively tiny percentage of commuters. Without action at 164th, we’re five years away from having a parade of buses every few minutes sliding across all three general purpose lanes of I-5 south in order to serve Ash Way as well as sliding across all three lanes of I-5 north to return to the HOV lanes north of 164th, while this uptick in buses will be added to the traffic on 164th as well as Ash Way as well, where the short-sighted county officials refused having a traffic signal at its entrance and designers muffed designing so as to use the traffic light there is south of the loop…but, wait, there’s more, for there will also be BRT Orange line buses running on 164th and Ash Way through the roundabout north of there every 10 minutes during peak hours in 2024…and then there’s the chaos that ensues every time there’s a snow event that will be even worse than the gnarly mess it was the last time I was there during one that may equate to what it would be like (Dec. 2016, when the south direct access ramps weren’t deiced despite ample forecasts).

    1. Has Ash Way station design started? I haven’t heard anything about it. The thing to look for is which options go into the EIS and when that decision will be made. That issue of a bus intercept vs a bike lane sounds like it would be pretty easy to get your option in because that station will probably get few total comments (it’s not a town center or a single-family neighborhood).

      Will there really be more buses going to it? Has ST announced it will be an interim terminus? In earlier plans it was a terminus but those never got approved. ST seems to be focusing now more on 128th than 164th. That will be East Link’s terminus, If ST builds ST3 in phases the first phase would probably be 128th to meet Swift Green (for Boeing). And if ST is forced to defer Everett/Paine due to cost it would probably terminate at 128th. At the same time, feeder buses that might go to Ash Way will probably go to Lynnwood instead because it’s just two miles further and the biggest city center and transfer point. The only buses that go to Ash Way might be those that serve the immediate area.

      1. :Has ST announced it will be an interim terminus? In earlier plans it was a terminus but those never got approved.”

        Ash Way was approved as the northern terminus in the first version of ST2, 2007’s Roads and Transit measure which failed at the ballot box. When ST came up with ST2 (2.0) the following year they unwisely stripped out the two northern stations (Ash Way and Alderwood) and settled on the Lynnwood TC as the northern terminus.

  8. Well, color me shocked.

    “Managing that debt load is critical to delivering the program on time.”

    No kidding, Captain Obvious. Private companies are fully aware of this and have bottom lines to worry about, not unlimited taxpayer funds to spend.

    The mental gymnastics people go through to validate bureaucratic waste never surprises me.

    You get the government that you vote for, Seattle. Enjoy it!

    1. You mean like the carefully managed private banking debt load, the mismanagement of which led to the 2008 global financial crisis?

    2. lol anyone who has worked in management for any private company knows “bureaucratic waste” is not limited to government.

    3. Taxpayer funds are not unlimited. The tax rate is capped by state law, voter approval, and bond commitments. It’s a limited amount of money each year and ST has to budget it. It’s the same as a company’s annual revenue. The whole reason Ballard, Everett, and Issaquah won’t open for 16-22 years is ST has to wait until it can pay those projects’ bills. The construction period nominally ends in 2041, and the taxes will be rolled back when those bonds are paid down (leaving only ongoing operation/replacement). ST can choose to extend the construction period beyond 2041, but that’s not the same thing as unlimited funds, and it can only be spent on voter-approved projects.

    4. Frank can we get a “block” function to deal with these “drive-bys” from reactionaries? Thanks.

  9. Just cut Issaquah light rail. What sort of dumb idea is that. I live in Snoqualmie, and most issaquah people have to drive anyways. Why give a tiny population such an amenity. I would give it to kirkland or renton.

    1. East King wanted it. It was pushed by Issaquah’s mayor who was an ST boardmember and East King’s ST3 champion. His enthusiasm puts Bellevue-Kirkland-Redmond to shame for not coming up with something more productive for their ST3 share. 405 Stride could have been multi-line. Renton could have got something more.

      But to change course now would require a new proposal and revote, and it would have to be coordinated with the other subareas so that they all make their adjustments at the same time. The political will was not there to downgrade Issaquah or West Seattle or Everett in 2016, so why should we think it has dramatically changed now?

      East King could just decline to implement Issaquah Link, but it couldn’t shift the money to a project not in ST3. It can’t roll back East King’s taxes alone, so the money would just sit in a savings account while people grumble about taxes. That doesn’t sound more popular than just building it.

      And even if some of the Link segments are overbuilt for the demand, that’s better than a cadillac aquarium or highway interchange or airport or any of the other dumb projects governments build.

      1. “The political will was not there to downgrade Issaquah or West Seattle or Everett in 2016, so why should we think it has dramatically changed now?”

        While I generally agree with the point you’re trying to make here, i.e., 2016 ambitions relating to system expansion are pretty much the same today, I’m not sure why you’ve included Everett in your comment. The spine concept, as dumb as it is, has always included Everett as the northern terminus. Actually, Everett was promised by the ST Board itself to be in PHASE TWO of the district’s light rail expansion but obviously that didn’t happen (Motion #2, passed by the board Dec 1994).

      2. I believe Everett and Tacoma are not necessary and can be adequately served by frequent feeders to Lynnwood and Federal Way. A short extension to Ash Way or 128th is a reasonable compromise. If we were to adjust ST3 in a revote, this is what I would suggest. I would also replace Issaquah Link with bus feeders, and West Seattle Link with multi-line BRT. None of this is politically acceptable now, but people might change their minds by the late 2020s or 2030s.

    2. The timing is on your side though. Issaquah Link won’t start construction until the mid 2030s. That gives you fifteen years to kill it before construction starts. There will be a new generation of boardmembers and mayors then, and they may want to rethink some of the decisions made in 2016. ST3 kind of anticipates that because the least-justified projects are scheduled last. (Everett 2036, Issaquah 2041, Tacoma 19th Ave 2041.) And if costs continue to escalate, ST might find it attractive to just truncate ST3 either after Everett or at the Everett 128th point. But the cities are watching this like hawks: they know this is a possibility and they’re trying to argue that they should get theirs as the cities before them did and they’ve been paying ST taxes all along. That will be a battle. If you happen to be mayor of Issaquah at the time, you could help guide it in a more pro-active direction. Certainly Issaquah would need adequate feeders as compensation.

      Another factor is that there will hopefully be a carbon tax by the 2030s, and the public may be more open to urban density. The Eastside will also be bigger then. Factoria may look like a midrise downtown Bellevue. The public might be more willing to switch to infill transit in the Totem Lake to Factoria area and leave far-flung Issaquah small. But, the county is a patchwork of cities, and each city is looking at its tax base. High-capacity transit means more companies willing to locate in the city, which means more sales tax income. Issquah will not look toward the common public good; it will look at what’s good for Issaquah, and will especially oppose something that shifts Issaquah’s tax base to Factoria (i.e.. Bellevue). We may need to restructure the tax incentives to stop cities from competing with each other.

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