Capital Program Realignment Project Next Steps August Board Meeting August 27, 2020 1? 3' SOUNDTRANSIT Why we are here System Expansion Project Overview • Financial update • Expansion program and paused action considerations • No actions today; discussion Only 2 Economic and financial impact of CO VID-19 Economic update What we know • US economy suffered its sharpest downturn in Q2, annualized GDP shrank at record 32.9% pace. • US Coronavirus cases passed 5.8 million and continue to surge. • WA unemployment rate near historical high. Enhanced unemployment benefits ended on July 31. • YTD (Jan-June) taxes significantly below budget: -11% sales tax, -5% on MVET, and -49% Rental Car Tax. 4 Economic and financial update What we do not know • Longer term stimulus package and economic support • Enhanced unemployment benefit reduced from $600/week to $300/week, and fund could run out in 5 weeks. • 23 states have been approved for the temporary increase in unemployment benefits. WA is not one of them. • Recession duration and depth. • Long term social and economic impacts. 5 Revenue loss projections Moderate recession scenario • • $656 million (-19%) in 2020 and 2021. $7.2 billion (-11%) through 2041. Sales Tax All Tax and Fare Revenues Net Loss After CARES Act 6 $ $ $ 2020 - 2021 (735,396,920) $ (822,146,155) $ (656,146,155) $ 2020 - 2041 2020 - 2041 (%) (6,119,918,364) -13% (7,312,833,770) -11% (7,146,833,770) -11% Revenue loss projections Severe recession scenario • • $921 million (-26%) in 2020 and 2021. $11.9 billion (-18%) through 2041. Sales Tax All Tax and Fare Revenues Net Loss After CARES Act 7 $ $ $ 2020 - 2021 2020 - 2041 2020 - 2041 (%) (1,000,406,173) $ (10,893,385,566) -23% (1,087,155,409) $ (12,086,300,972) -18% (921,155,409) $ (11,920,300,972) -18% Statutory debt limits and program affordability Fall 2019 projections vs. severe recession scenario Program cuts and delays required *In addition to legal debt capacity, debt capacity constraints also include financial policy and debt covenants . 8 Statutory debt limits and program affordability A realigned program could be affordable under the severe recession scenario $40 Principal Balance, YOE$ in Billions $35 $30 Severe Recession Scenario without program re-alignment $25 $20 Legal Debt Limit $15 $10 5 Year program delay $5 $2021 2022required 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 Program2020 cuts and delays *In addition to legal debt capacity, debt capacity constraints also include financial policy and debt covenants . 9 Current financial planning and budget efforts • Instead of annual Financial plan update pre-COVID, Financial plan is being updated on a monthly basis to capture new data. • Actively pursuing additional federal funding opportunities. • Reductions and discipline on 2020 spending and 2021 budget development. 10 Additional Information available for October Board • Updated key financial plan assumptions such as federal funding and borrowing rate • New Construction Cost Index • New Consumer Price Index • Updated long term tax revenue forecasts • 2-3 additional months of tax revenues • Updated ridership forecasts 11 Capital Program Realignment Capital program realignment Board project discussions to date April May June July Aug 13 ST2 approach and near-term project approach Past criteria Held workshop & Established criteria and path forward Review of paused projects Program/project briefings Path forward Criteria: framework for discussion Comprehensive program realignment Q3/Q4 2020 July ’21 Board June Board Construction and project development plans through 2021 14 Program realignment will reprogram projects to best meet ST2/ST3 plan intent within funding Criteria framework Scenarios include multiple revenue outcomes Scenario building On-going public engagement Board review Verify affordability within finance plan and policies 15 Revised schedule/funding Maintain shovel readiness Near-term approach Maintain Board’s flexibility and readiness for uncertain future Keep construction going safely • Northgate, East Link, Lynnwood, Federal Way, Downtown Redmond, Hilltop Tacoma Link, OMF East, Puyallup Continue work in planning and final design • • Maintain readiness for variable revenue/grant scenarios. Slower, more incremental approach in some instances as longer-term realignment takes shape. Hold on moving further projects into project development, final design or construction • 16 Avoid over-commitment until Board fully briefed and articulates priorities Project schedule Impacts COVID-19 impacts on environmental review • FTA focused on CARES Act grant awards • Tribal nations focused on health and safety Project pause impacts • System expansion schedules pre-COVID-19 were aggressive Staff assessing combined impacts on schedules • Mitigation options will be explored as projects advance • Low likelihood of fully recovering pre-COVID-19 schedules • Forecast completion for some projects shifting from end of one calendar year to beginning of next 17 Today’s workshop Review near-term approach to projects Overview of capital projects • Review by mode • Project status • Focus on near-term, paused actions • Project readiness information Purpose: Provide information for Fall 2020 near-term decisions 18 Elements to consider Will advancing the paused actions: Support project readiness while maintaining Board’s flexibility and avoiding over-commitments? Provide an opportunity to: • Review scope? • Gain more information on partner plans/capacity? • Examine contract packaging options? • Explore program phasing options? Focus on next steps that have low impacts to overall financial plan? 19 Sounder Projects Overview Sounder Projects Mukilteo Sounder South Platform Extensions (Tukwila to Tacoma Dome) South Tacoma and Lakewood Station Parking and Access Improvements Edmonds & Mukilteo Station Parking and Access Improvements Kent and Auburn Station Parking and Access Improvements Sumner Station Parking and Access Improvements Sounder Maintenance Base Puyallup Parking and Access PROJECT PHASE Improvements Planning 21 Design Construction Edmonds Tukwila Kent Sounder South Platform Extension PROJECT PHASE Pre-Planning Tacoma Dome Auburn South Sumner Tacoma Puyallup Lakewood Sounder Maintenance Base Planning Design Construction Sounder Projects * * * * * * Sounder South Platform Extensions (Tukwila to Tacoma Dome) South Tacoma and Lakewood Station Parking and Access Improvements Edmonds & Mukilteo Station Parking and Access Improvements Kent and Auburn Station Parking and Access Improvements Sumner Station Parking and Access Improvements Sounder Maintenance Base Puyallup Parking and Access PROJECT PHASE Improvements Planning 22 Design Construction * Projects with paused actions * * Mukilteo Edmonds * * * * * * Tacoma Dome * * Tukwila Kent Sounder South Platform Extension PROJECT PHASE Pre-Planning Auburn South Sumner Tacoma Puyallup Lakewood Sounder Maintenance Base * Planning Design Construction Sounder Projects Sounder South Platform Extensions 23 Project status Paused before starting planning Paused action • Budget amendment to start project development • Authorize Phase 1: Alternatives Development consultant contract Amount of action $3 million Focus of action Begin project development and examine design options Considerations • Most cost effective way to add capacity • Future ridership patterns unclear, especially for commuter-based service • Potentially eligible for federal grants Sounder Projects South Tacoma and Lakewood Station Parking and Access Improvements Project status Paused before starting Planning Paused action • South Tacoma: Budget amendment to start project development • South Tacoma and Lakewood: Authorize Phase 1: Alternatives Development consultant contract $4 million Identify and evaluate potential parking and access improvements • ST2 projects • Lower parking demand, future ridership and parking for commuter-based service demand unclear • City of Lakewood conducting station sub-area plan Amount of actions Focus of action Considerations 24 Sounder Projects Edmonds & Mukilteo Station Parking and Access Improvements Project status Paused action Amount of action Focus of action Considerations 25 • Completed Phase 1: Alternatives Development • Range of multimodal access options and nonstructured, leased parking Authorize Phase 2: Environmental review/conceptual engineering consultant contract $2 million Refine list of potential improvements to fit within available funding and complete environmental review • Lower parking demand, future ridership and parking for commuter-based service demand unclear • Improvements have relatively short lead time Sounder Projects Kent and Auburn Station Parking and Access Improvements Sumner Station Parking and Access Improvement Project status • • • • Kent/Auburn: Paused at end of Planning/PE Sumner: Paused after Final Design Design build project delivery Design Build Project Manager (DBPM) action already approved by Board Paused actions Execute DBPM consultant contract Amount of action • Kent and Auburn: $4 million • Sumner: $6 million Focus of action Begin project requirements needed for DB procurement Considerations • Project estimate currently over TIP budget • DBPM review scope and cost estimates, examine contract packaging strategy 26 Sounder Projects Sounder Maintenance Base Project status Paused actions Amount of action Focus of action Considerations 27 • • • • Completed Final Design phase Paused before advancing baseline action Design build project delivery Design Build Project Manager (DBPM) already approved by Board Execute DBPM consultant contract $2 million Begin project requirements needed for DB procurement • Facility likely provides long term savings opportunity • Existing maintenance agreement set to expire 12/24 • Limited scope of work for DBPM without advancing baseline decision ($210 million). Discussion Bus Rapid Transit Overview Bus Rapid Transit: Stride Rapid Transit I-405 BRT North I-405 BRT South SR 522 BRT North Bus Base NE 85th St. Interchange Agreement SR 522 BRT North Bus Base 85th Interchange I-405 BRT North I-405 BRT South PROJECT PHASE Planning PROJECT PHASE Planning 30 Design Design Construction Construction paused actions * I-405 BRT North I-405 BRT South SR 522 BRT North Bus Base NE 85th St. Interchange Agreement * Projects with * Bus Rapid Transit: Stride Bus Rapid Transit SR 522 BRT North Bus Base * * * 85th Interchange I-405 BRT North I-405 BRT South * * * * * PROJECT PHASE Planning PROJECT PHASE Planning 31 Design Design Construction Construction Bus Rapid Transit I-405 BRT North & I-405 BRT South Project Status • Two separate lines • Environmental review to be completed 9/2020 Paused actions • Authorize Phase 3: Preliminary Engineering (PE) consultant contract • Authorize General Engineering consultant (GEC) Amount of actions $13 million Focus of actions • Complete PE, finish Planning phase • GEC: Coordinate complex program; review scope, phasing, contract packaging options, and partner capacity Considerations • I-405 South: Express tolls lanes under construction • I-405 North: Contingent on WSDOT’s north end Express Toll Lanes project schedule • Projects can advance separately following PE phase 32 85th Interchange St. Agreement: I-405 BRT North NE 85th Interchange St. Agreement Project status Paused action Amount of action Focus of action Considerations 33 • Part of I-405 North project • Paused before completing agreement Authorize agreement with WSDOT ~$275 million Agreement to complete interchange project • Contingent on WSDOT’s north end Express Toll Lanes project schedule • Agreement could be completed in 2021 and still support 2025 I-405 North delivery • Would benefit from review by the GEC for phasing and scope Bus Rapid Transit SR 522 BRT Project Status Paused actions • Environmental review complete 11/2020 • Completing Preliminary Engineering Authorize General Engineering consultant (GEC) Amount of action $1 million • GEC: Coordinate complex program; review scope, phasing, Focus of action contract packaging options, and partner capacity • Coordination with I-405 BRT and Bus Base North Considerations 34 • NE 145th Coordination: Opportunity for scope and costs savings • Joint development opportunities not ready to advance Bus Rapid Transit North Base Project Status Paused actions Amount of action Focus of action Considerations 35 • Environmental review complete 9/2020 • Design build project delivery • Design Build Project Manager (DBPM) action already approved by Board Execute DPBM $12 million Begin project requirements needed for DB procurement • Sound Transit owns site • Site complexity with local jurisdiction • Base supports entire BRT program Discussion Link Light Rail Projects Link Projects Everett Link and OMF North North Corridor Maintenance of Way (MOW) Tacoma Dome Link (TDLE) and OMF South West Seattle/Ballard (WSBLE) 130th St. Station Federal Way Link Northgate Link East Link Downtown Redmond Link Lynnwood Link PROJECT PHASE OMF East Hilltop Tacoma Link Planning 38 Design Construction Everett Link OMF North Lynnwood Link N. Corridor MOW Northgate Link WSBLE 130th St. Station Downtown Redmond Link OMF East East Link OMF Forrest Street Federal Way Link OMF South Hilltop Tacoma Link PROJECT PHASE Pre-Planning Planning TDLE Design Construction Link Projects * Everett Link and OMF North * North Corridor Maintenance of Way (MOW) Tacoma Dome Link (TDLE) and OMF South West Seattle/Ballard (WSBLE) 130th St. Station Federal Way Link Northgate Link East Link Downtown Redmond Link Lynnwood Link PROJECT PHASE OMF East Hilltop Tacoma Link Planning 39 Design Construction * * Project with Everett Link * OMF North Lynnwood Link paused actions N. Corridor MOW Northgate Link WSBLE 130th St. Station Downtown Redmond Link OMF East East Link OMF Forrest Street Federal Way Link OMF South Hilltop Tacoma Link PROJECT PHASE Pre-Planning Planning TDLE Design Construction Link Light Rail Everett Link and OMF North Project status Paused before starting Planning Paused actions Authorize consultant contract to start Alternatives Development and project development $16 million • Consultant contract procurement process complete and ready for Board action • OMF North supports multiple alignments • Information from Planning phase could better inform Realignment process, including potential phasing options Amount of action Considerations 40 Discussion Additional Projects and Third Party Agreements Additional Projects/ Third Party Agreements North Sammamish Park and Ride Bus on Shoulder Everett Station Parking Contribution Madison BRT Funding Agreement Rapid Ride C/D Funding Agreement Everett Station Parking Contribution Madison BRT North Samm. Park and Ride Rapid Ride C/D Bus on shoulder PROJECT PHASE Planning PROJECT PHASE Planning 43 Design Design Construction Construction Additional Projects/ Third Party Agreements * * * * * North Sammamish Park and Ride Bus on Shoulder Everett Station Parking Contribution Madison BRT Funding Agreement Rapid Ride C/D Funding Agreement * * Project with paused actions * Everett Station Parking Contribution Madison BRT * * North Samm. Park and Ride Rapid Ride C/D * Bus on shoulder PROJECT PHASE Planning PROJECT PHASE Planning 44 Design Design Construction Construction Additional Projects North Sammamish Park and Ride Project status Completed Phase 1: Alternatives Development Paused actions Authorize Phase 2: Environmental Review and Conceptual Engineering Amount of action Focus of action $2 million Complete environmental review and advance parking lot design Further work at risk until City Council identifies preferred site Considerations 45 Additional Project Bus on Shoulder Project status Completed Phase 1: Alternatives Development Paused actions Phase 2: Environmental Review and Conceptual Engineering Amount of action Focus of action Considerations $1 million Finalize list of projects and complete environmental review Initial project development identified few opportunities, limited benefit 46 Third Party Agreements Everett Parking Agreement Project status Paused action Amount of action Focus of action Consideration 47 Agreement for construction of 90 parking stalls at Everett station Authorize agreement with City of Everett ~$0.7 million Reimbursement only; Construction complete • Cost effective • Supports Everett Link Extension Third Party Agreements Madison BRT Funding Agreement Rapid Ride C/D Funding Agreement Project status • Separate agreements • Paused before completing agreements Authorize agreements Paused actions Amount of action • Madison BRT: $35.8 million • Rapid Ride C/D: ~$25 million Madison BRT: Provide funding for construction Focus of action Rapid Ride C/D: Funding for project development, design, and construction Madison BRT: Considerations • Madison BRT has completed FTA readiness review but is awaiting a Federal funding allocation PROJECT PHASE Rapid Ride C/D: Not all project elements defined Planning 48 Design Construction Discussion Spending decisions happen over time '20 '21 '22 '23 '24 '25 '26 '27 '28 '29 '30 '31 '32 '33 '34 '35 '36 '37 '38 '39 '40 '41 '42 I-405 BRT SR 522/NE 145th BRT Link OMF South West Seattle Link Tacoma Dome Link Ballard Link Link OMF North Everett Link TCC Tacoma Link S Kirkland–Issaquah Link 50 Planning Design Construction Select project to build Baseline Construction is greatest portion of project costs 300 Construction: 70% Final Design/RoW: 20% 250 Award construction contracts Current $ Millions Environmental/PE: 10% 200 150 Select project to build 100 50 Open for service Baseline Initiate project 0 1 51 2 3 4 5 6 7 Year 8 9 10 11 12 13 14 15 Cost of authorizing all 15 paused development, design, and third party projects Paused actions total approximately $150 million which is 2% of the total costs of those projects ~$150 $7,169 Action Values Current $M Other project costs Advancing all $7.1B of these projects into construction on pre-Covid schedules is unaffordable and they will all still be subject to realignment. 52 Project readiness for delayed projects Protective ROW acquisition, permits, etc $300 Construction: 70% Final Design/RoW: 20% Environmental/PE: 10% $250 Current $ Millions $200 $150 Select project to build $100 $50 Award construction contracts Initiate project Open for service Baseline $1 2 3 4 5 6 7 Year 53 8 9 10 11 12 13 14 15 Board realignment process & schedule Near-term Decisions September Direct which paused actions to consider October Consider & possibly approve paused actions November Consider & possibly approve paused actions December Consider adoption of 2021 Budget & TIP Establish 2021 schedule for completion of realignment process Q1 2021 Consider further short-term actions, including any results from advancing paused actions. Determine realignment scenarios; gather public feedback Q2 2021 July 2021 54 Full Program Realignment Review update Financial Plan Develop Draft realigned program Adopt Final realigned program and consider any budget revisions Thank you. 1? 3' SOUNDTRANSIT soundtransit. org i Board briefings and proposed actions Ongoing August Board September October-November December 56 Financial updates Modal program & project briefings Discuss approach and schedule for paused actions Consider approving certain paused project actions Prepare for 2021 project actions & full realignment Link Light Rail Tacoma Dome Link (TDLE) and OMF South West Seattle and Ballard (WSBLE) Project Status Draft Environmental Impact Statement (DEIS) phase Paused actions None Amount of action Considerations NA • Delays to environmental phase due to COVID-19 impacts, especially in coordination with partners PROJECT PHASE Planning 57 Design Construction YOE $ Billions $8 $7 58 $6 $5 $4 $3 $2 $1 $- Environmental/PE Final Design/RoW Construction S Kirkland – Issaquah Link TCC Tacoma Link Everett Link Link OMF North Ballard Link West Seattle Link Tacoma Dome Link Link OMF South $9 SR 522/NE 145th BRT $10 I-405 BRT Cost per phase of major ST3 projects …summarize for Board…. 59 Month Activities August 2020 Refine evaluation criteria for application to scenarios September Obtain executive concurrence re: criteria application October Refine and model scenario affordability November Evaluate scenarios using criteria December Obtain executive concurrence re: scenarios to present to the Board January Prep Board members for public scenario discussion; begin outreach prep February Introduce scenarios in the Board room; finalize outreach prep March Begin public outreach April Complete outreach; modify & evaluate scenarios; develop Draft Plan May Refine Draft Plan & introduce at Board June Board deliberates Technical Public focus Realigned Plan Board focus July 2021 focusBoard deliberates and adopts