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January 16, 2014 at 6:25 AM

The specter of Seattle paying tunnel cost overruns, again

Seattle City Councilmember Mike O'Brien

Seattle City Councilmember Mike O’Brien

The specter of Seattle being on the hook for Highway 99 tunnel cost-overruns has been repeatedly raised (see: McGinn, Mike, former mayor) and repeatedly debunked, according to Seattle Times news reports.

But you can’t blame tunnel opponents like Seattle City Councilmember Mike O’Brien for raising them once again, with tunneling machine Bertha shutdown for a month.

At a council hearing Monday focused on the tunnel and the Seattle seawall, O’Brien conceded that the state was on the hook for the tunnel itself. “From the city’s perspective, I feel comfortable for now that is your deal,” he told Washington State Department of Transportation secretary Lynn Peterson.

But O’Brien noted there are other side deals between the city and state on the massive $3.1 billion project. Namely, the $290 million contract, paid by the state, to decommission the Battery Street tunnel, tear down the viaduct and replace Alaskan Way.

Is DOT “fully committed” to preserve that $290 million for that portion, even if Bertha blows her budget, O’Brien asked. DOT project administrator Todd Trepanier gave less than an absolute yes. “What is happening with this machine now, or what will happen at other times, the intent is not to take money that is set there… to complete this project.”

What Bertha dug, before she stopped

What Bertha dug, before she stopped (Washington State Department of Transportation photo)

Holy non-committal! That sort of squishy answer is the stuff that fueled the 2009-10 era debated over a Legislative amendment which makes Seattle a partner in cost-overruns. It was debunked as unenforceable because it is a state project. Yet it lives on.

What makes O’Brien’s question relevant again is that the state DOT is potentially doing that sort of budget-shifting right now with the Highway 520 project. To deal with the $170 million cost-overrun caused by the cracked bridge pontoons, DOT Secretary Lynn Peterson planned to issue more bonds against toll revenue, wiggle room allowed by the very good interest rates on existing 520 bonds. The problem, as O’Brien sees it, is that toll-bonding capacity could have been used to pay for the $1.4 billion west side landing of 520, which hasn’t been funded.

“What it means is the hole they have on the west side just got deeper,” O’Brien told me.

That anxiety is worsened by the Legislature’s inability to reach agreement on a statewide transportation. Full funding for the 520 west side is in the Senate version, but the Senate can’t even muster the will to vote for it.

Apply this scenario to the Highway 99 tunnel. The Bertha-dug tunnel is equivalent to the cracked pontoons, eating up the project budget. The Viaduct tear-down is the 520′s west side landing. What if there’s no money left for the second part? Senate Republican Leader Mark Schoesler of Ritzville, asked about it before this Legislative session, had an answer: Seattle pays. “The law is the law,” he said.

For Seattle to actually be on the hook requires a lot of catastrophe and for Inslee, among others, going back on their word. It would be a huge geo-political fight in Olympia. Don’t think it’s going to happen. Just saying it’s a scenario.

Here’s what’s ironic about O’Brien’s concern: Seattle itself is doing exactly the same budget-shifting game. The $30 million cost-overrun on the Seattle seawall project is coming out of a related portion of the project to rebuild Piers 62 and 63. Instead of $50 million for the rebuild, Seattle now has $20 million, and hasn’t said a peep about how it will finish the piers.

Here’s the video of Monday council meeting. O’Brien’s question is at 34:30.

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