SR 99 Tunnel's Financial Outlook Remains Negative Despite Cash Infusion, Traffic Uptick

Thanks to a significant cash transfer from the state legislature and a reduction in operating expenses, the near-term financial outlook for the State Route 99 deep bore tunnel in Seattle is looking much rosier than dire economic forecasts suggested as recently as last year. But even these significant aids to the state-operated program haven’t been enough to give the toll facility a healthy long-term financial outlook, suggesting another bailout could be on the horizon — perhaps within a decade.

Last summer, the Washington Transportation Commission, which sets state toll rates, was given a bleak financial picture of the tunnel’s near-term financial future following a post-pandemic recalibration of traffic volume. State Treasurer Mike Pellicciotti’s office portended a “permanent shift” in projected tunnel usage, leading to “insufficient revenues in every year.” Since then, things have shifted to take the tunnel out of that red alert situation.

The single biggest change since last year is the fact that the legislature came to the rescue of the flagship megaproject in the Washington State Department of Transportation (WSDOT) portfolio. This session, the legislature moved around funds in order to buoy the financial picture for the tunnel facility, aided primarily by the $77 million settlement WSDOT secured in late 2022 in its legal battle against Seattle Tunnel Partners, the coalition of businesses formed for the tunnel’s construction. Most notably, $25 million of that settlement went to the state’s general motor vehicle account, $16 million of that being used to repay a loan from the account to the SR 99 account. That erasure from the balance sheet leaves about $13 million remaining from that loan. The tunnel toll program, as initially envisioned, was intended to repay $200 million in debt from the construction of the tunnel in addition to covering its own operating expenses.

WSDOT has also recalibrated its operating and maintenance costs for the tunnel since last year. Those costs are partially related to traffic volumes in the facility, with lower usage translating to lower maintenance costs, generally speaking.

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https://www.theurbanist.org/2023/05/17/sr-99-tunnels-financial-outlook-remains-negative-despite-cash-infusion-traffic-uptick/