Urban Politics #93: Audit Of Sound Transit


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By City Councilmember Nick Licata.

Urban Politics (UP) blends my insights and information on current public policy developments and personal experiences with the intent of helping citizens shape Seattle’s future.

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CONTENTS:

  • Audit Of Sound Transit
  • Rationale For Letter To Sound Transit
  • Up Reader Survey
  • Letter To Sound Transit

Audit Of Sound Transit

I have joined a group of more than 50 elected officials, prominent community leaders and activists in calling for an independent audit of Sound Transit’s Link light-rail project.

Members of the group include fellow Council Member Peter Steinbrueck, County Council Members Maggi Fimia, Kent Pullen, and Rob McKenna, former Gov. Booth Gardner, Chairman of the Municipal League of King County Tom Albro, former Director of Metro Transit Chuck Collins, Executive Director of the NW Environmental Watch Alan Durning, Managing Partner of Pine Street associates Matt Griffin, Civic Activst Dorothy Bullitt and Councilmembers from four suburban cities. A full list of the membership is available on line at www.sanetransit.org .

Rationale For Letter To Sound Transit

The letter which appears at the end of this Urban Politics outlines our major concerns. Prior to signing a full funding grant agreement with the federal government for Link light rail, we ask that Sound Transit agree to an independent audit of its cost and ridership estimates, and of its financial capability to implement the Sound Move plan consistent with existing financial policies.

The main reason for going forward with Sound Transit, without any delay, is that voters approved building the light rail system by over 70% in Seattle. The retort is that the system as it is currently being planned has moved substantially away from what the electorate approved and at a higher cost. I believe that this creates a situation that necessitates an audit of Sound Transit.

UP Reader Survey

Below are two questions that I’m asking readers to respond to by emailing back in the Subject Line a “Yes” or a “No” for each question. Please read the letter first to get an understanding of what is being asked of Sound Transit. You may pass this Urban Politics survey onto other potential participants.

1. Did you vote for the Sound Transit Proposal in 1996: YES, NO, DK (don’t know or cannot remember)

2. Do you support the proposed independent audit of ST’s light rail plan even if it delays building a light rail system for more than a year: YES, NO, DK

Remember: Your responses go in the subject line

Sample: YES – NO, or NO – NO, or NO – Yes, or YES – YES There is no need to write anything else.

Thank you for taking the time to participate in this informal survey.

Letter To Sound Transit

September 6, 2000

Dear Members of the Board:

We, citizens and elected officials of the metropolitan Seattle area, support improved public transit, and other measures to relieve the congestion choking our communities. Many of us supported the Sound Transit plan approved by voters in 1996 as a critical step toward that goal. But alarming new developments in the Sound Transit Link light rail project have caused each of us to conclude that our region should consider putting this project on hold until it has survived closer scrutiny in the form of an independent audit.

This region needs unity in its drive for federal transit funding. A close look at Sound Transit’s light rail program has us deeply concerned; we cannot remain silent in good conscience. Link light rail may have more in common with WPPSS than with our region’s nationally heralded bus-transit system. Before we move forward, three questions need definitive answers: What is the real cost of Sound Transit’s Link light rail? Who will pay for the currently projected and other cost overruns? Will Link, which in its current phase is a Seattle/North King County project, absorb funds from jurisdictions across our metropolitan area?

Because of our grave concerns, we call on the Sound Transit Board to reconsider signing a “full funding” grant agreement with the federal government. This $500-million agreement will bind the taxpayers of our region to complete the proposed Link light rail line from the University District to Lander Street. It will obligate us to finish this line as proposed, regardless of cost or alternatives. This binding agreement may force us to divert funds away from other important transportation projects, and require us to raise local taxes beyond what the voters approved for Sound Transit.

1. How much will Sound Transit’s Link light rail really cost?

In 1996, the Sound Transit Board told voters that Link light rail would cost $1.67 billion (in 1995 dollars) and extend from the University District to SeaTac Airport. The Board assured voters its cost estimates were “very conservative.” Voters relied on that assurance. Since then, the cost of the project has risen, and its value has fallen. A glaring example is the change in the Seattle portion of the Link plan. The current plan omits or defers four of the 17 original Seattle stations.

The Executive Director of Sound Transit concedes that Link light rail is “about $200 million” over budget (Seattle Post-Intelligencer, August 8, 2000). A few days later he affirmed that, in addition, the bids for Link’s planned Capitol Hill tunnel are above the sum budgeted. The scale of the excess is secret “for strategic reasons” (Seattle Post Intelligencer August 18, 2000). Since then, the Executive Director said his solution to the high bids is to modify “the roles and responsibilities between the contractor and ST”. Translated, this means reduce the risk to the contractor by shifting it to Sound Transit. The March 2000 submission for funding to the federal government placed the cost estimate at $254 million beyond the original estimation; we do not know how much the tunnel bids will add to that cost overrun (all figures are in 1995 dollars).

After careful analysis, Kriss Sjoblom of the Washington Research Council concluded that Sound Transit has incurred additional obligations, including agreements to purchase the downtown tunnel from King County, buy property from the University of Washington, and mitigate impacts on the University, that total $223 million to $232 million more in cost overruns. This would place estimated overruns at nearly a half-billion dollars ($1995). Again, that is before the higher-than-budgeted tunnel bids. But even this figure is optimistic.

Serious questions have arisen concerning the adequacy of Sound Transit’s contingency funds and the Beacon Hill tunnel project’s budget. An almost-completed study of property acquisition and relocation costs in the Rainier Valley indicates that Sound Transit’s estimations are wrong, and that the cost will be no less than $100 million over budget. In addition, Sound Transit has seriously underestimated the costs of relocating the infrastructure of various utilities that will be displaced by construction, and the cost of connecting those utilities. Most troubling is that comparable rail and tunneling projects in Los Angeles have cost substantially more per mile of track than Sound Transit says it will spend. Sound Transit has offered no credible explanations for the disparity.

Link rail is one of the most expensive public works project in greater Seattle’s history. Sound Transit’s current financial projections are not transparent to the public. The citizens and taxpayers of this region are owed a transparent audit by independent experts, plus an ongoing process of financial review and oversight. If Sound Transit wants the confidence of the public, it must provide them with an open budget process, and clear, understandable and accurate financial information, honest and open. Once the public knows the full costs, it may decide to proceed. In 1996, the voters felt that $1.67 was an acceptable price for Link light rail. If the actual price is $2.5 billion, or $3 billion, for a smaller rail line, they may reconsider that decision.

2. How will we pay for cost overruns?

In 1996, Sound Transit promised to strictly adhere to a principle of “subarea equity”: revenue raised in a particular subarea would only be spent on Sound Transit projects in that subarea. Sound Transit promised to put “fire walls” around the revenue from each part of our metropolitan region so future decision makers could never siphon it off to pay for transit amenities elsewhere. Subarea equity was a part of Sound Move as adopted by the voters and is legally enforceable. Now Sound Transit is preparing to sign a federal grant making the entire region fiscally responsible for completing Link’s planned rail line from the University District to south of downtown. Sound Transit is telling the federal government that the financial capacity of the entire three-county area is adequate to complete Link, ignoring the fact that Sound Transit’s own financial policies require the completion of Link entirely within the fiscal capacity of North and South King County budgets.

According to Sound Transit’s own staff, the North King County subarea, which is obligated to pay for most of the phase one Link light rail program, may be unable to so within its own budget. We question whether Sound Transit can meet its commitments to the citizens of the region with existing tax revenues under the subarea equity policy. If it cannot, the public needs to know how Sound Transit will avoid shifting revenue from other regions or raising taxes. If the board of Sound Transit completes a full funding grant agreement with the federal government, it will impose an awesome obligation on the citizens of the region. If difficulties ensue and cost overruns accumulate, the region will be obliged to continue the project to its completion, regardless of cost, or repay its grant. The region has no adequate contingency plan to pay these costs. The lack of planning could tear our region apart with political recriminations and law suits. This is still another reason to ! have an open, independent audit before signing a binding federal grant agreement.

3. Will ridership justify the cost?

Sound Transit has claimed the light rail line will generate extensive improvements in “mobility”. All these claimed benefits are based on ridership forecasts that in turn depend on a number of assumptions concerning transit service, transfer rates, travel time, etc. As a result, small changes in the underlying assumptions can cause significant errors in the estimated benefits. In the four years since voters approved the Sound Transit plan a number of these underlying assumptions have changed. For instance, I-695 has made owing a car less expensive while at the same time transit agencies have increased bus fares. The increasing doubt about the reliability of assumptions used to estimate ridership is another reason the Sound Transit Board should pause for a reality check.

If we take Sound Transit’s forecasts at face value, what does Link do for the region? Many of the people who supported the Sound Transit plan expected it would alleviate traffic congestion on I-5. Buried in the Link environmental impact statement Sound Transit acknowledges “…the light rail system will not result in a significant difference in regional traffic volumes…”. In this instance, the change in traffic volume is forecast to be an imperceptible fraction of one percent. The picture for arterials is not any better. Many of the intersections analyzed in the EIS will experience greater traffic congestion as a result of the light rail line. Very few will experience any benefit. In downtown Seattle the buses evicted from the tunnel will add to traffic congestion on the surface streets making bus service slower and less reliable.

A primary justification for Link was a need for increased transit capacity through downtown Seattle. But it has been revealed that the light rail service Sound Transit now proposes to operate will provide less seated capacity in the peak hours than the existing bus service. Today, nearly all bus passengers are comfortably seated, but with light rail service Sound Transit forecasts more than a third of peak hour rail riders will be forced to stand. And because the rail line is so short with few stations, a larger number of passengers will be forced to transfer to buses to complete their trips. The extent to which the rail plan has been scaled back also greatly decreases the bus service hours that were to be freed up by rail.

The ridership figures Sound Transit has published give the impression that Link will greatly improve mobility, but the probable benefits are modest (far and away the majority of transit customers will still be bus riders) and the adverse impacts will be widespread and long-lasting. Isn’t it worth taking the time to see if there are alternatives that would yield a greater return on the regions’ two billion dollar investment?

Call for an Independent Audit

Prior to signing a full funding grant agreement with the federal government for Link light rail, we ask that Sound Transit agree to an independent audit of its cost and ridership estimates, and of its financial capability to implement the Sound Move plan consistent with existing financial policies. This review must examine the financial capacity of Sound Transit at both the regional and the subarea levels, and be conducted in a transparent fashion by an independent expert review. We propose that Sound Transit select one party, citizens independent of Sound Transit select a second party, and that both sides then select a mutually agreed upon third party to chair the process from the American Arbitration Association. That small panel would select an expert, independent consultant, and guide the process. Any of the three parties would have the right to raise questions and have them addressed. To assure objectivity, private citizens will undertake to pay half the cost and ! Sound Transit the other half. An expeditious time-line should be set so the Link light rail project can be carefully assessed without impeding its progress. We believe three months would be adequate, once the process is in place and the consultant selected. Sound Transit’s board should embrace this proposal and move it forward expeditiously.

Los Angeles’ recent experience with a rail tunnel and a full-funding grant agreement underlines our concerns: authorities there are under federal court order to restore the bus service curbed, and reduce the bus fares they raised, in order to manage the cost overruns and operating burdens of the rail projects they were obliged to complete because they accepted a federal grant. We fear that the transportation or general budgets of many jurisdictions in our region will end up mortgaged to Sound Transit for a short, multi-billion-dollar rail line that ends up costing nearly $200,000 for each car it takes out of traffic.

This, we believe, is not what voters had in mind.

Rob McKenna, King County Councilmember
Maggi Fimia, King County Councilmember
Kent Pullen, King County Council Member
Jack Barry, Mayor, City of Sammamish
Phil Dyer, Councilmember, City of Sammamish
Don Gerend, Councilmember, City of Sammamish
Kevin Grossman, Councilmember, City of Shoreline
Kathy Huckabay, Councilmember, City of Sammamish
Nick Licata, Councilmember, City of Seattle
Guy Spencer, Councilmember, City of Normandy Park
Peter Steinbrueck, Councilmember, City of Seattle
Booth Gardner, Former Governor of Washington
Norwood Brooks, Former King County Assessor
Jerome M. Johnson, Superior Court Judge (retired)

Keep in touch…

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