The U.S. Department of Transportation (U.S. DOT) executed an $87.7 million low-interest loan that will reduce regional taxpayers’ costs in constructing a new maintenance base in Bellevue to support upcoming light rail expansions across the region.
The loan, with an interest rate of 2.73%, is the agency’s second under a $1.99 billion master credit agreement approved by U.S. DOT last December through the Transportation Infrastructure Finance and Innovation Act (TIFIA). The credit agreement is the first of its kind in the nation in supporting four separate Sound Transit projects. It is expected to yield regional taxpayers long-term savings of between $200 million and $300 million in reduced borrowing costs.
“The people of Puget Sound stand to benefit the most from this needed U.S. Department of Transportation loan that will make possible a second storage and maintenance facility for upcoming light rail expansions,” said Sound Transit CEO Peter Rogoff. “Securing the nation’s first master credit agreement last year was a big win for our region, especially when one considers the taxpayer dollars we’ll save on borrowing costs.”
Sound Transit applied for the U.S. DOT TIFIA loans, administered by the Build America Bureau, to insulate the agency from unexpected downturns in the economy and provide taxpayers savings from agency borrowing costs. The TIFIA loans allow the agency to borrow money at rates that are typically significantly lower than otherwise available. Loans supporting Sound Transit’s Lynnwood and Federal Way light rail extensions are expected to be executed in 2018.
Sound Transit is continuing to advocate for Congress to maintain the federal government’s longstanding and bipartisan partnership with regions around the country of providing grants supporting transit expansions. These grants, which unlike loans don’t need to be repaid, are proposed for elimination by the Trump Administration’s FY 2018 budget.
The 25-acre Operations and Maintenance Facility East in Bellevue is needed for continuing expansion of the region’s light rail system. By 2024, the system will grow from 22 to 62 miles and the existing light rail fleet will more than triple in size, from 62 to 214 vehicles. The current facility in Seattle can store and maintain at least 104 light rail vehicles. The new eastside facility will be designed to maintain, store, and deploy an additional 96 vehicles.