Senate bill would borrow, use gas taxes, and spend federal funds to pay for 520 cost overruns
The Senate Transportation Committee passed SB 6001, making supplemental appropriations to the transportation budget, and moved the bill to the Rules Committee for full Senate consideration. Lawmakers provided a plan to pay for the $170 million in cost overruns on the 520 Bridge Project.
The 520 Bridge Project has already exhausted its entire $250 million contingency fund, and the Washington State Department of Transportation said pontoon design errors resulted in the need for $170 million more. We discussed alternative solutions, without increasing debt, here.
SB 6001 includes the following:
The legislature finds that the most appropriate way to pay for the cost overruns related to change orders, additional sales tax, and future risks associated with pontoon design errors, is for the state to issue triple pledge bonds in the 2015-2017 fiscal biennium resulting in $110,961,000 in proceeds, and use efficiencies and favorable bids in the highway construction program to generate an additional $61,066,000 towards paying for the overruns. Of this additional $61,066,000, $33,866,000 should come from the transportation partnership account—state appropriation and $27,200,000 should come from federal funds.
Triple pledge bonds are backed by toll revenue, gas tax revenue, and the full faith and credit of Washington state.