City Council staffers have proposed three potential options for funding the city’s share of the waterfront improvements planned as part of the Alaskan Way Viaduct replacement project. Of the three options, two do not include the 30-year seawall bonding measure Mayor Mike McGinn proposed shortly after he was elected.
All three options include a local-improvement district on and near the waterfront—essentially, a special tax on property owners whose property values rise as the result of improvements on the waterfront. The city estimates that planned improvements to the waterfront will increase nearby property values between $450 million and $600 million.
The local-improvement district would pay for an estimated $122 million of the $425 million in city obligations that remains “unsecured.”(An additional $416 million in obligations are secured, meaning that funding sources to pay for them have been identified.) Those unsecured obligations include funding for the seawall replacement, utility relocation, and parking, among other things.
The difference, $305 million, would be funded by some combination of several potential funding sources.
First, there’s Mayor McGinn’s proposal, which I wrote about two weeks ago. That proposal includes a 30-year bond funded by a property-tax increase that would cost the average Seattle household $50 a year—the seawall tax McGinn proposed shortly after he took office. It would also include a 2.5 percent increase in the commercial parking tax.
The second option would include a nine-year property tax levy that would cost the average homeowner $75 a year, plus a 5 percent increase in the commercial parking tax. The final option includes an increase in the commercial parking tax and a new vehicle-license fee of $45 per vehicle.
I have a call in to McGinn’s office to get the mayor’s reaction to the two new proposals, both of which presume McGinn’s seawall measure does not go on the November ballot.
Each proposal has advantages and disadvantages. McGinn’s proposal would spread the expense more evenly and over a longer period of time, but it would require approval by 60 percent of Seattle voters rather than a simple majority.
The second proposal would cost each household more money and increase the cost of parking more than the other proposals, but a nine-year property tax levy would only require approval by 50 percent of the voters.
And the last proposal would also only require 50 percent approval, but would use up part of the city’s capacity to pass a special transportation benefits district on the waterfront. That authority was supposed to be used to build new transportation improvements on the waterfront, not for replacing existing infrastructure like the seawall.
Council member Nick Licata has also proposed amending the agreement between the city and the state on viaduct replacement to isolate the state’s various obligations into discrete pots of money, so that funding for reconnecting the street grid on the north end of the tunnel, for example, could not be diverted to pay for tunnel replacement in case of cost overruns. Licata’s proposal would not protect the city from the obligation to pay for cost overruns.
