Capital Program Realignment

Project Next Steps

August Board Meeting
August 27, 2020
 Why we are here
System Expansion Project Overview
• Financial update

• Expansion program and paused action considerations

• No actions today; discussion Only

2
Economic and financial
impact of COVID-19
 Economic update
What we know
• US economy suffered its sharpest downturn in Q2,
annualized GDP shrank at record 32.9% pace.
• US Coronavirus cases passed 5.8 million and continue to
surge.
• WA unemployment rate near historical high. Enhanced
unemployment benefits ended on July 31.
• YTD (Jan-June) taxes significantly below budget: -11%
sales tax, -5% on MVET, and -49% Rental Car Tax.

4
 Economic and financial update
What we do not know
• Longer term stimulus package and economic support
• Enhanced unemployment benefit reduced from $600/week to
$300/week, and fund could run out in 5 weeks.
• 23 states have been approved for the temporary increase in
unemployment benefits. WA is not one of them.
• Recession duration and depth.
• Long term social and economic impacts.

5
Revenue loss projections
Moderate recession scenario
• $656 million (-19%) in 2020 and 2021.
• $7.2 billion (-11%) through 2041.

2020 - 2021 2020 - 2041 2020 - 2041 (%)

Sales Tax $ (735,396,920) $ (6,119,918,364) -13%
All Tax and Fare Revenues $ (822,146,155) $ (7,312,833,770) -11%
Net Loss After CARES Act $ (656,146,155) $ (7,146,833,770) -11%

6
Revenue loss projections
Severe recession scenario
• $921 million (-26%) in 2020 and 2021.
• $11.9 billion (-18%) through 2041.

2020 - 2021 2020 - 2041 2020 - 2041 (%)

Sales Tax $ (1,000,406,173) $ (10,893,385,566) -23%
All Tax and Fare Revenues $ (1,087,155,409) $ (12,086,300,972) -18%
Net Loss After CARES Act $ (921,155,409) $ (11,920,300,972) -18%

7
Statutory debt limits and program affordability
Fall 2019 projections vs. severe recession scenario

Program cuts and delays required

*In addition to legal debt capacity, debt capacity constraints also include financial policy and debt covenants .

8
Statutory debt limits and program affordability
A realigned program could be affordable under the severe
recession scenario
$40

$35

$30
Principal Balance, YOE$ in Billions

Severe Recession Scenario

$25 without program re-alignment

$20
Legal Debt Limit
$15

$10
5 Year program delay
$5

$-
Program2020 2021
cuts and 2022required
delays 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041
*In addition to legal debt capacity, debt capacity constraints also include financial policy and debt covenants .

9
 Current financial planning and budget
efforts
• Instead of annual Financial plan update pre-COVID,
Financial plan is being updated on a monthly basis to
capture new data.
• Actively pursuing additional federal funding
opportunities.
• Reductions and discipline on 2020 spending and 2021
budget development.

10
 Additional Information available for
October Board
• Updated key financial plan assumptions such as
federal funding and borrowing rate
• New Construction Cost Index
• New Consumer Price Index
• Updated long term tax revenue forecasts
• 2-3 additional months of tax revenues
• Updated ridership forecasts

11
Capital Program Realignment
Capital program realignment
Board project discussions to date

April ST2 approach and near-term project approach

May Past criteria
June Held workshop &
Established criteria and path forward
July Review of paused projects
Aug Program/project briefings

13
 Path forward

Criteria: Comprehensive
framework for program
discussion realignment
Q3/Q4 2020

June Board July ’21 Board

Construction
and project
development
plans through
2021

14
Program realignment will reprogram projects to
best meet ST2/ST3 plan intent within funding
Criteria
framework

Scenarios include
Scenario
multiple revenue
building
outcomes On-going public
engagement
Board review
Verify affordability
within finance plan Revised Maintain shovel
and policies schedule/funding readiness

15
Near-term approach
Maintain Board’s flexibility and readiness for uncertain future
Keep construction going safely
• Northgate, East Link, Lynnwood, Federal Way, Downtown Redmond, Hilltop
Tacoma Link, OMF East, Puyallup

Continue work in planning and final design

• Maintain readiness for variable revenue/grant scenarios.
• Slower, more incremental approach in some instances as longer-term
realignment takes shape.

Hold on moving further projects into project development, final design

or construction
• Avoid over-commitment until Board fully briefed and articulates priorities
16
Project schedule Impacts
COVID-19 impacts on environmental review
• FTA focused on CARES Act grant awards
• Tribal nations focused on health and safety
Project pause impacts
• System expansion schedules pre-COVID-19 were aggressive
Staff assessing combined impacts on schedules
• Mitigation options will be explored as projects advance
• Low likelihood of fully recovering pre-COVID-19 schedules
• Forecast completion for some projects shifting from end of one calendar
year to beginning of next
17
Today’s workshop
Review near-term approach to projects

Overview of capital projects

• Review by mode
• Project status
• Focus on near-term, paused actions
• Project readiness information

Purpose: Provide information for Fall 2020 near-term decisions

18
 Elements to consider
Will advancing the paused actions:
Support project readiness while maintaining Board’s flexibility and
avoiding over-commitments?

Provide an opportunity to:

• Review scope?
• Gain more information on partner plans/capacity?
• Examine contract packaging options?
• Explore program phasing options?

Focus on next steps that have low impacts to overall financial plan?
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Sounder Projects Overview
Sounder Projects
Mukilteo

Sounder South Platform

Extensions (Tukwila to Tacoma
Dome) Edmonds

South Tacoma and Lakewood

Station Parking and Access
Improvements
Edmonds & Mukilteo Station
Parking and Access
Improvements
Kent and Auburn Station Parking
and Access Improvements Tukwila Sounder South
Platform Extension

Sumner Station Parking and PROJECT PHASE

Access Improvements Kent
Pre-Planning
Tacoma
Sounder Maintenance Base Dome Auburn Planning

Puyallup Parking and Access

PROJECT PHASE
South Sumner Design
Improvements Tacoma Puyallup
Lakewood
Planning Design Construction Construction

21 Sounder
Maintenance Base
Sounder Projects
* Projects
with * Mukilteo
* Sounder South Platform paused
Extensions (Tukwila to Tacoma
Dome) actions * Edmonds

* South Tacoma and Lakewood

Station Parking and Access
Improvements
* Edmonds & Mukilteo Station
Parking and Access
Improvements
* Kent and Auburn Station Parking
and Access Improvements * Tukwila * Sounder South
Platform Extension
* Sumner Station Parking and
Access Improvements * Kent
PROJECT PHASE
Pre-Planning

* Sounder Maintenance Base Tacoma

* Auburn
* Dome Planning

Puyallup Parking and Access

PROJECT PHASE
* South *
Sumner Design
Improvements * Tacoma Puyallup
Lakewood
Planning Design Construction
* Construction

22 Sounder
Maintenance Base
Sounder Projects
Sounder South Platform Extensions
Project status Paused before starting planning
Paused action • Budget amendment to start project development
• Authorize Phase 1: Alternatives Development consultant
contract
Amount of action $3 million
Focus of action Begin project development and examine design options
Considerations • Most cost effective way to add capacity
• Future ridership patterns unclear, especially for
commuter-based service
• Potentially eligible for federal grants
23
Sounder Projects
South Tacoma and Lakewood Station Parking and Access Improvements
Project status Paused before starting Planning
Paused action • South Tacoma: Budget amendment to start project
development
• South Tacoma and Lakewood: Authorize Phase 1:
Alternatives Development consultant contract
Amount of actions $4 million
Focus of action Identify and evaluate potential parking and access
improvements
Considerations • ST2 projects
• Lower parking demand, future ridership and parking for
commuter-based service demand unclear
• City of Lakewood conducting station sub-area plan
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Sounder Projects
Edmonds & Mukilteo Station Parking and Access Improvements
Project status • Completed Phase 1: Alternatives Development
• Range of multimodal access options and non-
structured, leased parking
Paused action Authorize Phase 2: Environmental review/conceptual
engineering consultant contract
Amount of action $2 million
Focus of action Refine list of potential improvements to fit within available
funding and complete environmental review
Considerations • Lower parking demand, future ridership and parking for
commuter-based service demand unclear
• Improvements have relatively short lead time

25
Sounder Projects
Kent and Auburn Station Parking and Access Improvements
Sumner Station Parking and Access Improvement
Project status • Kent/Auburn: Paused at end of Planning/PE
• Sumner: Paused after Final Design
• Design build project delivery
• Design Build Project Manager (DBPM) action already approved
by Board
Paused actions Execute DBPM consultant contract
Amount of action • Kent and Auburn: $4 million
• Sumner: $6 million
Focus of action Begin project requirements needed for DB procurement
Considerations • Project estimate currently over TIP budget
• DBPM review scope and cost estimates, examine contract
packaging strategy
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Sounder Projects
Sounder Maintenance Base
Project status • Completed Final Design phase
• Paused before advancing baseline action
• Design build project delivery
• Design Build Project Manager (DBPM) already approved
by Board
Paused actions Execute DBPM consultant contract
Amount of action $2 million
Focus of action Begin project requirements needed for DB procurement
Considerations • Facility likely provides long term savings opportunity
• Existing maintenance agreement set to expire 12/24
• Limited scope of work for DBPM without advancing
baseline decision ($210 million).
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Discussion
Bus Rapid Transit Overview
Bus Rapid Transit: Stride
Rapid Transit
I-405 BRT North
I-405 BRT South SR
522 BRT
North Bus Base

85th Interchange
SR 522 BRT
I-405 BRT North
North Bus Base
NE 85th St. Interchange
Agreement I-405 BRT South

PROJECT PHASE
Planning

PROJECT PHASE Design

Planning Design Construction

Construction

30
Bus Rapid Transit: Stride
Bus Rapid Transit * Projects
* with
paused
* I-405 BRT North actions
*
* I-405 BRT South * North Bus Base

SR 522 BRT SR * 85th Interchange

* 522 BRT * I-405 BRT North
* North Bus Base
NE 85th St. Interchange
Agreement * I-405 BRT South

PROJECT PHASE
Planning

PROJECT PHASE Design

Planning Design Construction

Construction

31
Bus Rapid Transit
I-405 BRT North & I-405 BRT South
Project Status • Two separate lines
• Environmental review to be completed 9/2020
Paused actions • Authorize Phase 3: Preliminary Engineering (PE) consultant
contract
• Authorize General Engineering consultant (GEC)
Amount of actions $13 million
Focus of actions • Complete PE, finish Planning phase
• GEC: Coordinate complex program; review scope, phasing,
contract packaging options, and partner capacity
Considerations • I-405 South: Express tolls lanes under construction
• I-405 North: Contingent on WSDOT’s north end Express
Toll Lanes project schedule
• Projects can advance separately following PE phase
32
85th Interchange St. Agreement: I-405 BRT North
NE 85th Interchange St. Agreement
Project status • Part of I-405 North project
• Paused before completing agreement
Paused action Authorize agreement with WSDOT
Amount of action ~$275 million
Focus of action Agreement to complete interchange project
Considerations • Contingent on WSDOT’s north end Express Toll Lanes project
schedule
• Agreement could be completed in 2021 and still support
2025 I-405 North delivery
• Would benefit from review by the GEC for phasing and scope

33
Bus Rapid Transit
SR 522 BRT
Project Status • Environmental review complete 11/2020
• Completing Preliminary Engineering
Paused actions Authorize General Engineering consultant (GEC)

Amount of action $1 million

Focus of action • GEC: Coordinate complex program; review scope, phasing,
contract packaging options, and partner capacity
• Coordination with I-405 BRT and Bus Base North
Considerations • NE 145th Coordination: Opportunity for scope and costs
savings
• Joint development opportunities not ready to advance

34
Bus Rapid Transit
North Base
Project Status • Environmental review complete 9/2020
• Design build project delivery
• Design Build Project Manager (DBPM) action already
approved by Board
Paused actions Execute DPBM
Amount of action $12 million
Focus of action Begin project requirements needed for DB procurement
Considerations • Sound Transit owns site
• Site complexity with local jurisdiction
• Base supports entire BRT program

35
Discussion
Link Light Rail Projects
Link Projects Everett Link
Everett Link and OMF North
OMF North
North Corridor Maintenance of Lynnwood Link

Way (MOW) N. Corridor MOW

Tacoma Dome Link (TDLE) and 130th St. Station

OMF South Northgate Link Downtown

Redmond Link
OMF East
West Seattle/Ballard (WSBLE) WSBLE

130th St. Station East Link

OMF

Federal Way Link Forrest Street

Northgate Link
East Link Federal Way Link
PROJECT PHASE

Downtown Redmond Link OMF South Pre-Planning

Hilltop
Tacoma Link Planning

Lynnwood Link TDLE Design

PROJECT PHASE
OMF East
Planning Design Construction Construction

38
Hilltop Tacoma Link
Link Projects *
* Everett Link and OMF North * Project
with *
Everett Link

* North Corridor Maintenance of paused

OMF North
Lynnwood Link

Way (MOW) actions N. Corridor MOW

Tacoma Dome Link (TDLE) and 130th St. Station

OMF South Northgate Link Downtown

Redmond Link
OMF East
West Seattle/Ballard (WSBLE) WSBLE

130th St. Station East Link

OMF

Federal Way Link Forrest Street

Northgate Link
East Link Federal Way Link
PROJECT PHASE

Downtown Redmond Link OMF South Pre-Planning

Hilltop
Tacoma Link Planning

Lynnwood Link TDLE Design

PROJECT PHASE
OMF East
Planning Design Construction Construction

39
Hilltop Tacoma Link
Link Light Rail
Everett Link and OMF North

Project status Paused before starting Planning

Paused actions Authorize consultant contract to start Alternatives
Development and project development
Amount of action $16 million
Considerations • Consultant contract procurement process complete
and ready for Board action
• OMF North supports multiple alignments
• Information from Planning phase could better inform
Realignment process, including potential phasing
options

40
Discussion
Additional Projects and Third
Party Agreements
Additional Projects/ Everett Station
Parking Contribution

Third Party Agreements

North Sammamish Park and
Ride
Madison BRT
Bus on Shoulder North Samm.
Park and Ride
Everett Station Parking
Contribution Rapid Ride C/D

Madison BRT Funding

Agreement Bus on shoulder

Rapid Ride C/D Funding

Agreement PROJECT PHASE
Planning

PROJECT PHASE Design

Planning Design Construction

Construction

43
Additional Projects/ * Everett Station

* Project Parking Contribution

Third Party Agreements with

* paused
North Sammamish Park and
actions
Ride * Madison BRT
* Bus on Shoulder * North Samm.
Park and Ride
* Everett Station Parking *
Contribution Rapid Ride C/D

* Madison BRT Funding

Agreement * Bus on shoulder
* Rapid Ride C/D Funding
Agreement PROJECT PHASE
Planning

PROJECT PHASE Design

Planning Design Construction

Construction

44
Additional Projects
North Sammamish Park and Ride
Project status Completed Phase 1: Alternatives Development
Paused actions Authorize Phase 2: Environmental Review and Conceptual
Engineering

Amount of action $2 million

Focus of action Complete environmental review and advance parking lot
design
Considerations Further work at risk until City Council identifies preferred site

45
Additional Project
Bus on Shoulder
Project status Completed Phase 1: Alternatives Development
Paused actions Phase 2: Environmental Review and Conceptual Engineering
Amount of action $1 million
Focus of action Finalize list of projects and complete environmental review
Considerations Initial project development identified few opportunities,
limited benefit

46
Third Party Agreements
Everett Parking Agreement
Project status Agreement for construction of 90 parking stalls at Everett
station
Paused action Authorize agreement with City of Everett
Amount of action ~$0.7 million
Focus of action Reimbursement only; Construction complete
Consideration • Cost effective
• Supports Everett Link Extension

47
Third Party Agreements
Madison BRT Funding Agreement
Rapid Ride C/D Funding Agreement
Project status • Separate agreements
• Paused before completing agreements
Paused actions Authorize agreements
Amount of action • Madison BRT: $35.8 million
• Rapid Ride C/D: ~$25 million
Focus of action Madison BRT: Provide funding for construction
Rapid Ride C/D: Funding for project development, design, and
construction
Considerations Madison BRT:
• Madison BRT has completed FTA readiness review but is
PROJECT PHASE awaiting a Federal funding allocation
Planning
Rapid Ride C/D: Not all project elements defined
Design Construction

48
Discussion
Spending decisions happen over time
'20 '21 '22 '23 '24 '25 '26 '27 '28 '29 '30 '31 '32 '33 '34 '35 '36 '37 '38 '39 '40 '41 '42

I-405 BRT
SR 522/NE 145th BRT
Link OMF South
West Seattle Link
Tacoma Dome Link
Ballard Link
Link OMF North
Everett Link
TCC Tacoma Link
S Kirkland–Issaquah Link

50 Planning Design Construction Select project to build Baseline

 Construction is greatest portion of project
costs 300
Construction: 70%

250 Final Design/RoW: 20% Award

Environmental/PE: 10% construction
contracts
200
Current $ Millions

150 Select
project to
build Open for
Baseline service
100

Initiate
50 project

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Year

51
 Cost of authorizing all 15 paused
development, design, and third party projects
Paused actions total approximately $150 million
which is 2% of the total costs of those projects
~$150

$7,169

Action Values Other project costs

Current $M
Advancing all $7.1B of these projects into construction on pre-Covid
schedules is unaffordable and they will all still be subject to realignment.
52
 Project readiness for delayed projects
Protective ROW acquisition, permits, etc
$300
Construction: 70%
$250 Final Design/RoW: 20%
Environmental/PE: 10%
$200
Current $ Millions

$150 Award
construction Open for
Select contracts
$100 project to service
build
Initiate Baseline
$50 project

$-
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Year

53
 Board realignment process & schedule
Near-term Decisions Full Program Realignment

September Direct which paused actions to

consider
October Consider & possibly approve Review update Financial Plan
paused actions
November Consider & possibly approve
paused actions
December Consider adoption of 2021 Establish 2021 schedule for completion
Budget & TIP of realignment process
Q1 2021 Consider further short-term Determine realignment scenarios;
actions, including any results from gather public feedback
advancing paused actions.
Q2 2021 Develop Draft realigned program

July 2021 Adopt Final realigned program and

consider any budget revisions

54
Thank you.

soundtransit.org