Template revised April 12, 2018.
COMMISSION
AGENDA MEMORANDUM
Item No.
8c
ACTION ITEM
Date of Meeting
January 7, 2020
DATE: December 19, 2019
TO: Stephen P. Metruck, Executive Director
FROM: Eric ffitch, Manager, State Government Relations
SUBJECT: Interlocal Agreement (GCB 3603) with Washington State Department of
Transportation (WSDOT) regarding the Puget Sound Gateway Program
ACTION REQUESTED
Request Commission authorization for the Executive Director to execute an interlocal agreement
in substantially the form attached with the Washington State Department of Transportation to
formally outline the plan and schedule for payment of the $30 million Port of Seattle share of
local matching funds for the construction of the Puget Sound Gateway Program.
EXECUTIVE SUMMARY
This interlocal agreement with WSDOT formally puts the commission on record as pledging up to
a $30 million contribution to the Puget Sound Gateway Program. The port’s finance department
has this in the Plan of Finance as seven equal payments, set to begin in 2023. The $30 million
contribution is equal to the amount the Port of Tacoma will pledge to the program through the
2018 Puget Sound Gateway MOU. The interlocal agreement document has been reviewed by the
port’s finance and legal departments.
The Port of Seattle has participated in the Puget Sound Gateway Program Executive Committee,
where Commissioner Creighton was the initial representative, followed by Commissioner
Steinbrueck, the current representative. Generally, the completion of SR 509 and the inclusion
of the Puget Sound Gateway Program in the 2015 Connecting Washington package have been
priorities for the Port of Seattle.
JUSTIFICATION
In July 2015, the Washington State Legislature and Governor Inslee acted to fund the Gateway
Program through the Connecting Washington revenue package. The Gateway Program is
comprised of two projects: the State Route 167 Completion Project and the State Route 509
Completion Project. These projects provide essential connections to the ports of Tacoma and
Seattle and will help ensure people and goods move more reliably through the Puget Sound
region.
COMMISSION AGENDA – Action Item No. _8c__ Page 2 of 6
Meeting Date: January 7, 2020
Template revised September 22, 2016; format updates October 19, 2016.
The funding package for the Puget Sound Gateway Program totals $1.875 billion, and includes
the following sources: gas taxes, tolls, local contributions, and potential federal and state grants.
The local match component requires the local agency partners that are served by, or benefit
from, the two roadways to secure funding to leverage state program investments.
In 2017, the Washington State Legislature included language in the transportation budget for the
2017-2019 biennium directing WSDOT to develop an MOU with local jurisdictions that formally
outlines the plan and schedule for the local funding contribution toward the Gateway Program.
On March 22, 2018, the Port of Seattle Commission voted to authorize the Executive Director to
sign the MOU with WSDOT and the other local agencies involved.
The Port of Seattle and the Northwest Seaport Alliance consider the completion of the Gateway
to be critical to a vital freight corridor that supports the movement of goods to and from our
seaport facilities and our Seattle-Tacoma International Airport. The program provides direct
freight links between our facilities and key distribution centers and also improves regional
mobility for goods that arrive in the Puget Sound from Eastern Washington and states along the
US supply chain’s northern tier that are bound for international destinations.
In addition to the economic benefits of improved freight mobility, any upgrades to the
transportation network in the congested Puget Sound region have significant community
benefits as well. Communities in South King County, around the SR 509 corridor, have seen the
challenging impacts of passenger and cargo growth through the airport and in the region as a
whole. Upgrading the transportation network that serves their community, is another important
reason the Port has supports the Gateway Program.
DETAILS
Schedule
According to the Washington State Legislature, the local match requirement comes due
beginning in 2023. The MOU calls for the initial Port contribution of $15 million “expected in
2023-2025.” This ILA indicates a first payment, for Stage 1b of Phase 1, no sooner than the end
of 2025. The second payment of $15 million is anticipated on or after 2028, following the
completion of Stage 2 of the SR 509 portion of the Puget Sound Gateway Program.
Included below is the schedule as laid out in the May 2018 Memorandum of Understanding with
the Washington State Department of Transportation and local municipalities that are also acting
as funding partners for the Puget Sound Gateway program.
Stage 1 Grant Pursuits for Local Nexus Projects
Project
Estimated
Constructio
n Cost
Funding
Progra
m
Grant
Target
Amount
Anticipate
d
Constructi
on
Local Agency
Partner
Match
Partner
Nexus
COMMISSION AGENDA – Action Item No. _8c__ Page 3 of 6
Meeting Date: January 7, 2020
Template revised September 22, 2016; format updates October 19, 2016.
Expenditur
e
70
th
Avenue
E/Interurban
Trail
$32,245,600
FMSIB
$5,000,000
2019-2021
$800,000
$500,000
$3,000,000
Fife
Tacoma
Port of
Tacoma
TIB
$5,000,000
2019-2021
State
Capital
&
Transpo
rtation
$1,400,000
2019-2021
Fife
Veterans
Drive/ SR516
Interchange
$33,800,000
PSRC
$4,500,000
2021-2025
$1,000,000
Kent
TIB
$5,000,000
2021-2025
$1,000,000
Kent
SeaTac
Access
$176,883,50
0
PSRC
$4,500,000
2021-2025
$2,000,000
$500,000
SeaTac (ROW
in lieu)
Des Moines
Port of
Tacoma
Access/509
Spur
$323,042,00
0
PSRC
$4,500,000
2021-2025
$1,500,000
$3,000,000
$800,000
Tacoma
Port of
Tacoma
Fife
FMSIB
$5,000,000
2021-2025
All Gateway
Program
INFRA
$20,000,000
*
2019-2021
SR 167 Stage
1
Port of
Tacoma
2021-2025
$9,000,000
Port of
Tacoma
SR 509 Stage
1
Port of
Seattle
2021-2025
$15,000,000
Port of
Seattle
(expected in
2023-2025)
Total Stage 1
$54,900,000
$38,100,000
$93,000,000
Stage 2 Future Grant Pursuits for Local Nexus Projects
Project
Estimated
Constructio
n Cost
Funding
Progra
m
Grant
Target
Amount
Anticipated
Constructio
n
Expenditure
Local
Agency
Partner
Match
Partner
Nexus
Meridian
Avenue
Interchange
TBD
$3,000,000
2026-2030
$2,000,000
Puyallup
Valley
Avenue
Interchange
TBD
$3,000,000
2026-2030
$2,000,000
Pierce County
COMMISSION AGENDA – Action Item No. _8c__ Page 4 of 6
Meeting Date: January 7, 2020
Template revised September 22, 2016; format updates October 19, 2016.
188
th
Street
Interchange
improvement
s
TBD
TBD
2026-2030
TBD
SR 167 Stage
2
TBD
$4,000,000
2026-2030
$500,000
$500,000
Edgewood
(ROW in lieu)
Sumner
Port of
Tacoma
2026-2030
$15,000,000
Port of
Tacoma
SR 509 Stage
2
TBD
$4,000,000
2026-2030
Port of
Seattle
2026-2030
$15,000,000
Port of
Seattle
Total Stage 2
$14,000,000
$35,000,000
$49,000,000
Total Stages
1 & 2
$68,900,000
$73,100,000
$142,000,000
* – If no INFRA, apply for FHWA BUILD grant for Port of Tacoma Access (SR 509 Spur)
TBD – grant funding program pursuit to be determined in future
ALTERNATIVES AND IMPLICATIONS CONSIDERED
Alternative 1 – Set a payment schedule consistent with the Port’s original expectations based on
7 equal payments beginning in 2023.
Cot Implications: None
Pros:
(1) This is cost neutral to the Port and consistent with the Port’s funding forecast
Cons:
(1) This is not preferred by the WSDOT and is inconsistent with its funding needs
This is not the recommended alternative.
COMMISSION AGENDA – Action Item No. _8c__ Page 5 of 6
Meeting Date: January 7, 2020
Template revised September 22, 2016; format updates October 19, 2016.
Alternative 2 – Not contribute payment to the Puget Sound Gateway Program.
Cost implications: $30m in savings to the Port of Seattle.
Pros:
(1) The Port would achieve $30m in savings.
Cons:
(1) The Port would violate its agreement with WSDOT and the other local governments who
signed the May 2018 Memorandum of Understanding.
(2) The Port would potentially compromise its relationship with the Washington State
Legislature.
(3)
Alternative 3 – Maintain payment schedule from the May 2018 MOU and transmit two equal
$15m payments to WSDOT for completion of Stage 1b and Stage 2 respectively.
Cost Implications: Port payment to WSDOT would total $30m, currently accounted for in the
Port’s Plan of Finance.
Pros:
(1) Consistent with the MOU the Port Commission adopted unanimously in May 2018.
Cons:
(1) Does not achieve cost savings to the Port.
This is the recommended alternative.
FINANCIAL IMPLICATIONS
Annual Budget Status and Source of Funds
The $30 million Port contribution is currently written into the Port’s Plan of Finance. It is
separated into seven equal installments and scheduled to begin in the year 2023. The funding
source for this agreement would be the tax levy or general obligation bonds.
The 2023-2029 timeframe for the Port contribution is based on the timeline put forward by the
Washington State Legislature in their 2017-2019 transportation budget. That budget requires the
local match for the Gateway Program to be received by the Department of Transportation
beginning in the 2023 budget year.
ADDITIONAL BACKGROUND
State and regional grants-focused strategy: Following the passage of the budget language in the
2017 legislative session calling on WSDOT to develop an MOU with local funding partners,
WSDOT hired a consultant team to help determine how local municipalities could develop
funding to meet the local match requirement.
COMMISSION AGENDA – Action Item No. _8c__ Page 6 of 6
Meeting Date: January 7, 2020
Template revised September 22, 2016; format updates October 19, 2016.
This team is leading the effort to secure grant funding through various sources – Puget Sound
Regional Council FHWA funds; Freight Mobility Strategic Investment Board; and Transportation
Improvement Board – by which local entities could meet the state matching requirement. They
have identified “nexus projects,” distinct program components of the Gateway program that
would be good candidates for grants and have begun helping local jurisdictions apply.
The Port has provided letters of support to grant applicant and appeared as requested alongside
WSDOT in a grant application presentation to the PSRC review committee.
Federal grant strategy: WSDOT has applied through the federal INFRA program for federal grand
funding, submitted in November 2017. Award announcements are anticipated in June 2018, and
WSDOT believes Puget Sound Gateway has a strong and highly competitive application.
However, if this is not successful, there are additional rounds of BUILD or TIGER rounds to apply
again. Both the Port of Seattle and NWSA provided a letter of support with the INFRA grant
application.
ATTACHMENTS TO THIS REQUEST
(1) Draft Interlocal Agreement (GCB 3603) with Washington State Department of
Transportation
(2) Final signed MOU from March 2018 outlining Port of Seattle contribution and schedule
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS
March 22, 2018— The Port of Seattle Commission authorized the Executive Director to
execute the Puget Sound Gateway MOU with other agency partners.
November 22, 2017 – The Commission convened a roundtable on “Increased Travel to and
from the Airport over the next 20 years” which included a briefing from WSDOT Puget
Sound Gateway Program Administrator Craig Stone on the Gateway Program.