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Prospectus Blog State Treasurer Urges More Tolling For SR 520 Bridge Rebuild Tab

The Seattle Post-Intelligencer’s Chris McGann reports today Washington State Treasurer Michael Murphy urges tolls on both the State Route 520 bridge and Interstate 90, to help fill a funding gap of at least $2.7 billion in the planned six-lane replacement for the former. The state has been considering 520 tolling to help pay for the bridge replacement, but not I-90 tolling; that would require federal approval. Currently, the state transportation commission oversees what very limited tolling is currently planned for implementation in Washington, and under proposed legislation, tolls would have to be approved by the state legislature. However, best practices might well suggest that regional transportation project funding decisions including tolling would be made by a regional transportation commission, if the legislature decides to allow its creation.
Murphy’s call for SR 520 and I-90 tolling is supported in a new study done for the state by Seattle Northwest Securities Corporation and Montague DeRose and Associates. The study notes:

Without additional (state) funds, some tolling of both bridges will likely be necessary prior to completion of the project. Under the current assumptions, if only SR 520 were tolled, financing would fall 31 percent to 33 percent short of funds needed for the project.

From today’s P-I story (first link, above):

Murphy said in an interview that he won’t sell bonds for the project without the additional tolling because the state can’t afford it under current finance plans. He says the tolls should be put in place before the new state Route 520 bridge is completed…..”I will not authorize the debt to be issued for a project that can’t pay for itself,” Murphy said. “In order for the thing to work, both bridges — period — need to be tolled, not parts of bridges, not certain lanes.”
….Murphy said it’s time for lawmakers to face reality. “Now push is coming to shove, and decisions have to be made,” he said. “I don’t think anybody likes that idea of having to toll regionally as opposed to specifically. But the reality check is this: You can afford it, or you can’t afford it. If you can afford it, how are you paying for it? Well, if we got a bunch of free money from the feds or we had a local tax that was put in place, but the revenue from the 9.5 (cent-per-gallon gas-tax increase) has already been allocated to other stuff. The only way to finance (the $4.4 billion project) is with revenue streams that are sufficient to pay back the people who buy our bonds. And as the treasurer of the state, I have to certify to the people who buy our bonds that I have looked at the numbers and the numbers work. If they come up with a plan that is 33 percent short, I will not issue the bonds.”

In a Seattle Times story today on the same topic, Murphy underscores the logistical as well as financial case for tolling both bridges, rather than just 520.

Murphy reasoned that introducing a toll only on 520 would create problems by diverting about 30 percent to 50 percent of traffic onto the other floating bridge. “Then we get a parking-lot scenario on 90, and a financial problem on 520,” he said.

The preliminary 520 finance report to the state also recommends that it “consider establishing an independent tolling authority in the future to set and raise tolls and operate various tolled transportation projects throughout the state, similar to that which is done in other parts of the country.” Generally speaking, that’s a forward-looking recommendation. Our state must come to grips with the need for more tolling, more public-private partnerships and public contracting reforms to stretch the dollars that will pay for vital transportation infrastructure improvements. However, if such a state tolling body were created, its toll-setting powers might well need to be tailored so as not to pre-empt those of any regional transportation commissions, such as the one envisioned for Central Puget Sound.
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