CEO Peter Rogoff is proposing new, less territorial ways of dividing the Sound Transit pie. His big idea: Since a new $1.7 billion downtown tunnel would benefit the whole region, don’t make Seattle taxpayers shoulder the whole bill.

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Imagine five roommates gathered for dessert. A cherry pie bakes in the oven.

Perhaps they will divide it into equal slices.

Or maybe, the biggest piece goes to the one who paid more for flour, sugar and fruit. Or the one with the quickest metabolism.

Welcome to the debate over how taxes are raised and spent in five Sound Transit taxing areas in King, Snohomish and Pierce counties. Traditionally, Sound Transit sales and car-tab taxes raised in one area have been spent on projects that benefit that area.

What happens in Lynnwood, stays in Lynnwood, so to speak.

The five budget silos help explain why the agency can afford to build train tracks to car-dependent Issaquah and south Kirkland, but not reach transit riders in dense Fremont; or why Snohomish County, which generates the least sales-tax revenue, requires so much debt financing, for light rail to reach Everett Station, instead of enjoying a trickle-down effect from richer Seattle.

But as Sound Transit prepares a $54 billion November ballot measure to expand light rail, commuter trains and bus service, new CEO Peter Rogoff wants to change the territorial mindset. Suburban taxpayers would cover half the $1.7 billion cost for a second downtown Seattle transit tunnel.

Without a second tunnel, trains might get stuck in the Chinatown International District, delaying a regional 116-mile network serving a half-million daily riders. The whole system — from Tacoma to Everett and Redmond to Issaquah — would depend on the tunnel, Rogoff reasons, so everyone should pay.

Peter Rogoff,  (Dean Rutz/The Seattle Times)
Peter Rogoff, (Dean Rutz/The Seattle Times)

Paranoia motivates

Sound Transit’s budgeting method, known as “sub-area equity,” was born of paranoia.

Supporters were looking for a way to win a funding campaign in 1996 after an embarrassing defeat the previous year.

To reassure suburban voters, a strategy paper issued by Acting Chairman Dave Earling, of Edmonds, enshrined “a commitment to invest revenues to benefit the areas where they are raised.”

Then-King County Councilmember Rob McKenna, of Bellevue, and Issaquah businessman Skip Rowley, among other critics of light rail, worried that without such assurances, Seattle would soak up Eastside money.

They guessed correctly.

Sound Move passed in 1996, and construction costs doubled. It took 13 years to open an initial line from downtown to SeaTac for $2.6 billion, paid only by North King, South King and Uncle Sam.

“Without sub-area equity, there would have been an effort to take money from other parts of the Sound Transit district,” recalls McKenna, who later became state attorney general.

Meanwhile, the Eastside accumulated surpluses, which will finally be spent soon on the $3.7 billion light-rail extension to Bellevue and Overlake, along the Interstate 90 floating bridge.

“Twisted” budgeting?

Sometimes the policy turns fuzzy.

Eastside taxes pay to operate nine ST Express bus lines that cross or bypass Lake Washington, totaling $912 million from 2009-23. That’s despite abundant service to Seattle residents — notably Route 545, where Capitol Hill techsters ride to Overlake.

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“We’ve argued with this for years,” said Renton Councilmember Don Persson, whose city considers itself shortchanged in transit spending.

A simple explanation is that every dime from Seattle was needed to finance its light-rail core last decade, so planners had little choice but to make Eastsiders pay for crosslake buses.

The late Jim MacIsaac, a traffic engineer who advised the pro-roads Eastside Transportation Association, called the budgeting decisions “twisted” in a 2011 essay. Based on ridership, he argued Seattle should fund 40 percent of trans-lake bus hours, and most of East Link light rail.

Kirkland City Councilmember Toby Nixon says Eastside Sound Transit dollars should not be used for rail to Seattle. The money should stay wholly east to provide massive bus-rapid transit along I-405, he said, especially since Kirklanders can cross the lake quickly on a Highway 520 bus.

“My sincere hope is ST3 fails, and they’re forced to take another look at what would be efficient,” Nixon said.

Spending rivalries

Seattle residents wonder why ST3 doesn’t include a tunnel joining Ballard, Fremont, Wallingford and the University District. A few have posted on social media they’ll vote “no” in the fall.

Despite proposed bond sales of $8 billion, Seattle’s ”subarea,” which includes Shoreline and Lake Forest Park, can’t generate enough income to build a Ballard-U District line. The money already has been promised to corridors connecting Ballard and West Seattle to downtown.

Raiding the suburbs for revenue wouldn’t work, because Snohomish and South King are only half as lucrative as Seattle. Their allotments are highly leveraged to finance the board’s top priority, “the regional spine” from Everett to Tacoma.

The pro-transit group Seattle Subway asked for a Ballard-U District line but accepts there’s no construction money guaranteed by ST3, said political director Jonathan Hopkins.

“I really think sub-area equity is a way to keep inter-regional rivalry lower,” he said. “People in this system get what they pay for, and it fundamentally strikes people as fair.”

Over the years, transit boosters have blamed the five-zone policy for retaining money within the suburbs, instead of launching train lines sooner within densely populated Seattle.

Then-Mayor Greg Nickels was spurned in 2008 when he asked Aaron Reardon, who was Snohomish County executive, to lend Snohomish-area money to the Seattle area for the sake of building the 2021 Northgate Station a year sooner.

Seattle Mayor Ed Murray, who prides himself on regionalism, in his 2013 campaign proposed in The Stranger to ditch the sub-area budgeting system, so more dollars could be focused on West Seattle, Ballard, and “inner-ring suburbs.”

His detractors feared the opposite, that to abandon the budget rules in ST3 would cause Seattle’s wealth to be scattered, toward places such as Everett and Federal Way.

Everett-area officials this spring grumbled that Sound Transit’s light-rail schedule favored Ballard and West Seattle, making Everett wait until 2041.

Rogoff defused that rivalry by expanding the potential $50 billion pie to $54 billion — presuming voters accept annual increases of $400 per median household in property, sales and car-tab taxes. And Everett would get light rail sooner, in 2036.

Regional asset

Which brings us to downtown Seattle, where a second tunnel from Stadium Station to Westlake Station would require $1.7 billion.

Trains arriving from Tacoma would enter at Stadium Station and continue toward Uptown and Ballard, while West Seattle trains would run through the existing downtown tunnel on their way to UW and Northgate.

Funding proposals have evolved, from billing only the Seattle area, to making each taxing area pay based on its tax revenues — to guessing where the future downtown riders will come from. North King would pay just over half, Snohomish and South King each 13 percent, and the Eastside 14 percent. Pierce would cover just 8 percent, since few Tacomans would ride 70 minutes into Seattle.

Transit-planning consultant Jarrett Walker, author of Human Transit, praises the compromise.

Sound Transit is following the example of similar connector plans in Los Angeles and Toronto, to treat a downtown section as a regional asset, he said.

“It is not Seattle that needs a second subway through downtown Seattle. It’s the region that needs more capacity, to move the region’s trains,” he said.

Murray says the downtown-tunnel proposal proves local cooperation is growing.

“I think folks are realizing you can’t just divide the money up by geography alone,” he said. “I thought it was a massively different discussion, from years ago.”

Other agencies don’t make such efforts to write policies, audits and yearly breakdowns to ensure that different parts of the overall transit territory get their share, said Sound Transit Chief Financial Officer Brian McCartan.

A person can go nuts, overthinking how to slice the pie.

King County Metro paid $469 million for the transit tunnel a quarter-century ago, while Sound Transit’s North King fund provided $94 million on retrofits for light rail.

Rogoff said to the best of his knowledge, nobody in Seattle has asked the neighbors for reparations.

Correction: Information in this article, originally published June 12, 2016, was corrected June 13, 2016. A previous version of this story an incorrectly spelled the name of  Jim MacIsaac.