Another updside down transportation policy

On Crosscut, David Brewster questioned whether Sound Transit's first phase, which won voter approval in 1996, is one of the "word's biggest boondoggles?" He compares the agency's initial promises to voters with the fact they are now billions of dollars over budget and many years late.

While Sound Transit's troubles are well documented, the philosophy that led to the agency's woes is even more outrageous. Brewster says:

Are you shocked? If so, consider that most of these projects are in fact wildly popular, even if the public had to be gulled to go along with building them. It's standard practice to low-ball cost estimates, in order to get the bond issue passed, and then to add on costs as politics requires and the public demands more than the bare-bones model.

So basically, the publisher of Crosscut is saying that taxpayers shouldn't be "shocked" when large public works transportation projects run late and over budget. In fact, according to Brewster, voters and taxpayers should somehow expect and appreciate being misled:

Meanwhile, voters confronted with bond issues for such mighty plans might keep in mind the same rule of thumb that works when you call an architect to remodel your house: Double the budget and double the estimated time. And remember, it's usually worth it, if you somehow get it built.

Ummm, this is not entirely analogous....unlike a homeowner hiring an architect, taxpayers do not have the option to stop the flow of money when things go wrong.

Nevertheless, according to Brewster, deliberately underestimating costs and overestimating revenues to sweeten the appearance of a large public works transportation project is ok and we should be thankful for not being told the truth because the means will always justify the ends....right???

The PI reports ST2 will cost $22.8 billion and be completed by 2023. Applying Brewster's new methodology means that voters should expect ST2 to cost $45.6 billion and not be completed until 2038.

So do you still think moving less than one percent of all trips by the year 2038 is worth $45.6 billion?

Comments

[fact checker]

That $22 billion "cost" estimate the papers quote is ST's estimate of what the capital costs of the new projects would be, plus operations costs through 2023.

What that $22 billion "cost" estimate does NOT include is all of the tax revenue ST would haul in merely for the purpose of sticking it into reserve accounts to comply with security terms of the bond sale contracts.

That proposed financing method is utterly abusive. It calls for ST to collecting tens of billions of tax dollars MORE than what ST needs to cover the capital and operations costs. ST wants to engage in that excessive taxing because the bond market will not accept ST's debt securities unless ST pledges to collect all that extra tax. I am not making this up - these people are animals.

[David Brewster]

I'm innocent of saying people should be thankful for such overruns. My point is that politics, post the levy election, often drives up the price, usually with elected officials agreeing to the changes. Sometimes there is deliberate deception, though I doubt that was the case with Sound Transit 1. At other times, so much contingency is built in, lest there be an overrun, that the project is way more expensive than it needs to be. That has probably been the case with the Alaskan Way Viaduct. These are hard things to project.

[fact checker]

"My point is that politics, post the levy election, often drives up the price, usually with elected officials agreeing to the changes."

First, nobody was elected to Sound Transit's board. They are political appointees only. And that's a really bad way to structure a government.

More significantly David, and as you would know if you you would take the time to read what the 100-page law says that voters approved in 1996, the board of ST has no right to agree to any higher build-out period spending. The amount of funds voters gave ST's board the right to spend was capped. Res. 75 specifies that the board must either scale back on project spending, or not begin some of the projects described in the Sound Move document. The "Sane Transit" court opinion in 2004 discusses this point: the court held the board was obligated to only build the 13.5 mile initial segment because the controlling local law required it to scale back in light of the available funds being insufficient.

It is as if you are deliberately mischaracterizing the board of ST's rights to tax and spend when you write about ST. Your comment here is another example of it, and your Crosscut piece posits the same kind of falsehood.

Finally, I see today you are a big booster of Jim Ellis. Ellis wrote in the "Statement For" ST1 that appeared in the 1996 Voters Guide that the average cost per family of ST1 would be $8 per month. Taking inflation OUT of the equation, the average family last year paid about twice that much.

Ellis' law firm has made tens of millions off of ST's lousy efforts at trying to do something about transportation in the region. Do you really think he wanted to tell the truth about what it would cost taxpayers when he was pimping ST1 in 1996?

[fact checker]

What Ellis wrote in the Voters Guide in 1996 was that ST1 would cost the average family “$8 per month in increased taxes.” That’s $96 per year in 1996 dollars, and with inflation in 2007 it would be $129.50. The reality, based on ST's actual tax collections in 2007, is that the average family paid about $250 in taxes to ST last year.

[fact checker]

David, if you don't mind, I've got a question for you. Did Jim Ellis suggest you post a number of statements implying you think Sound Transit would be within its rights to spend as much tax revenue as it wanted to complete the Phase I projects?

I'm just trying to figure out if you came up with that incorrect notion on your own, or whether someone gave it to you. No offense intended, of course. You shouldn't take this personally.