Two years after he first proposed a new streetcar line through the South Lake Union area, Seattle Mayor Greg Nickels has come up with a...
Two years after he first proposed a new streetcar line through the South Lake Union area, Seattle Mayor Greg Nickels has come up with a detailed financing plan for the 2.6-mile loop.
Responding to conditions imposed by the City Council, the mayor’s plan would not siphon away money from police, fire protection, parks or other basic services that rely on the city’s general fund.
But it would take almost $1 million a year intended for new bus service in Seattle and steer that to the streetcar.
Nickels’ financial blueprint for building and running the streetcar also would rely on unsecured federal grants, on selling the naming rights for stations and the streetcar line, and on selling development rights on city property. Nickels also would tap proceeds from a 2001 sale of city property to companies controlled by Paul Allen.
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Most council members have not seen Nickels’ plan, which he sent to council offices on Thursday afternoon. After a quick review, council Transportation Committee Chairman Richard Conlin said the mayor’s proposal “looks reasonable and responds well to our questions and concerns.”
The new streetcar line is modeled after Portland’s relatively new system.
Paul Allen’s company Vulcan is leading the redevelopment of South Lake Union as a biotech center with 8,000 new apartments and condos. Allen’s company has been an advocate for the streetcar, as have some other property owners in the area, including the Seattle Times Co.
In Nickels’ financing proposal, building the new rail line and purchasing modern streetcars would cost $47.5 million, which is $2.5 million more than the mayor initially estimated.
The mayor expects to collect $25 million from private property owners near the line, many of whom have pledged to meet such a commitment.
Another $12.3 million would come from federal and state grants the city has secured. An additional $2.5 million would come from selling development rights above the proposed streetcar maintenance shed on city-owned property at the southwest corner of Fairview Avenue North and Valley Street.
City consultant Ken Johnsen, whose firm played a key part in developing Portland’s streetcar line, said it was likely that condos and apartments would go atop the maintenance facility. Johnsen said he did not expect that noise or other byproducts of the maintenance barn would chase away potential developers or residents.
Conlin agreed. “I don’t know if it’s any different from being on top of a parking garage,” the councilman said.
If Johnsen and Conlin are right, that would leave the city $7.7 million short on construction costs. Nickels would plug that gap with more federal and state grants and proceeds from the 2001 sale of city property in South Lake Union to Allen for $20 million. In approving that deal, the City Council specified that $9 million of the proceeds should be spent on transportation improvements in the area.
Financing the operation of the new streetcar line might prove more difficult than building it.
Nickels projects that the streetcar would cost about $1.6 million a year to run, from its first full year in 2008 through 2011. He would use four sources of money. About 42 percent of the operating cost would come from $1.25 fares, federal grants and revenue from the sale of naming and advertising rights. The rest would come from King County Metro, the county transit agency, which would operate the streetcar under an agreement with the city.
King County Metro would do so by dedicating resources to the streetcar that would have been used for new bus service in the city.
Michael Mann, a policy adviser to Nickels, said the streetcar would take less than 20 percent of the new Metro resources allocated to the city starting in 2009.
Streetcar stations, similar to Metro bus shelters, would be erected every two to three blocks along the route. Based on experiences in Tampa, Fla., and Portland, Nickels’ staff is confident that they can sell 10-year naming rights to the stations for about $1.3 million. They also expect to sell naming rights to the streetcar line and painted advertising on the cars for roughly $1.7 million.
Conlin said council members would probably question the mayor’s projections for naming-rights revenue and streetcar ridership.
Nickels projects that about 350,000 passengers a year would board the streetcars when they start running in mid-2007. The mayor expects the number of riders to double by 2016.
Nickels’ consultants also presented to the council last week details about the impact of the streetcar on traffic and parking. They predict that 85 on-street parking spaces would be lost to the streetcar, which would run in the right traffic lane on streets such as Westlake Avenue North.
Conlin has laid out a three-month schedule for reviewing the streetcar plan before the council would vote on whether to green-light the project. The next key step is a study of financial benefits the streetcar would bring to nearby property owners. Those projected benefits will be used to assess special taxes on private property owners to apportion the $25 million they are expected to contribute to the streetcar.
Bob Young: 206-464-2174 or email@example.com