SB 5488 — Completing outstanding financial obligations regarding the Tacoma Narrows toll bridge project.

S-4500.2S-3237.1 SUBSTITUTE SENATE BILL 5488 State of Washington 67th Legislature 2022 Regular Session By Senate Transportation (originally sponsored by Senators Randall, Rolfes, Billig, Dhingra, Nobles, Van De Wege, and C.

Wilson)Wilson READPrefiled FIRST12/06/21. TIME 02/15/22.

ANRead ACTfirst Relatingtime to01/10/22. state contributions in support of the Tacoma Narrows toll bridge;

andReferred amendingto RCWCommittee 47.56.165,on 47.46.190,Transportation. and 47.46.200.

AN ACT Relating to completing outstanding financial obligations regarding the Tacoma Narrows toll bridge project;

adding a new section to chapter 82.32 RCW;

adding a new section to chapter 47.46 RCW;

and making appropriations.

NEW SECTION.

RCWA 47.56.165new andsection 2009is cadded 567to schapter 182.32 areRCW each amended to read as follows:

ABy specialJuly account1, to2022, be known as the Tacomastate Narrowstreasurer tollmust bridgetransfer accountfrom is created in the motorgeneral vehicle fund into the statefollowing treasury.accounts:

(1) DepositsThe tohighway bond retirement fund under RCW 47.10.847 $672,000,000, which reflects the accountoutstanding mustprincipal include:and interest payments on the bonds issued for construction of the Tacoma Narrows public-private initiative project under chapter 47.46 RCW;

(a)(2) AllThe proceedstransportation ofpartnership bondsaccount issuedunder forRCW construction46.68.290 $43,000,000, which reflects full repayment of the Tacomatemporary Narrowstransfers public-privatemade initiativein project,chapter including333, anyLaws capitalizedof interest;2021, in accordance with RCW 47.46.190;

(b) All of the toll charges and other(3) revenuesThe received from the operation of the Tacoma Narrows bridge as a toll facility,bridge toaccount beunder depositedRCW at47.56.165 least$57,020,000. monthly;

(c)p. Any interest that may be earned from the deposit or investment of those revenues;

(d)1 NotwithstandingSB RCW5488 47.12.063,NEW proceedsSECTION. from the sale of any surplus real property acquired for the purpose of building the second Tacoma Narrows bridge;

((and)) p.

1 SSB 5488 (e) All liquidated damages collected under any contract involving the construction of the second Tacoma Narrows bridge;

and (f) Beginning with September 2022 and ending July 1, 2032, by the last day of September, December, March, and June of each year, the state treasurer shall transfer from the general fund to the account the sum of $3,250,000.

The total amount that may be transferred pursuant to this subsection is $130,000,000.

(2) Proceeds of bonds shall be used consistent with RCW 47.46.130, including the reimbursement of expenses and fees incurred under agreements entered into under RCW 47.46.040 as required by those agreements.

(3) Toll charges, other revenues, and interest may only be used to:

(a) Pay required costs that contribute directly to the financing, operation, maintenance, management, and necessary repairs of the tolled facility, as determined by rule by the transportation commission;

and (b) Repay amounts to the motor vehicle fund as required under RCW 47.46.140.

(4) Toll charges, other revenues, and interest may not be used to pay for costs that do not contribute directly to the financing, operation, maintenance, management, and necessary repairs of the tolled facility, as determined by rule by the transportation commission.

(5) The department shall make detailed quarterly expenditure reports available to the transportation commission and to the public on the department's website using current department resources.

(6) When repaying the motor vehicle fund under RCW 47.46.140, the state treasurer shall transfer funds from the Tacoma Narrows toll bridge account to the motor vehicle fund on or before each debt service date for bonds issued for the Tacoma Narrows public-private initiative project in an amount sufficient to repay the motor vehicle fund for amounts transferred from that fund to the highway bond retirement fund to provide for any bond principal and interest due on that date.

The state treasurer may establish subaccounts for the purpose of segregating toll charges, bond sale proceeds, and other revenues.

RCWThe 47.46.190sum andof 2018$672,000,000, cor 195as smuch 1thereof areas eachmay amendedbe necessary, is appropriated for the fiscal biennium ending June 30, 2023, from the highway bond retirement fund to readthe asstate follows:treasurer-bond retirement and interest for the purpose of making full payment of the outstanding principal and interest payments on the bonds issued for construction of the Tacoma Narrows public-private initiative project under chapter 47.46 RCW.

p.NEW SECTION.

2 SSB 5488 (1) The legislature finds funding of the Tacoma Narrows bridge facility to be distinct from other Washington state tolling facilities due to its increasing debt service costs, which is the primary driver of the facility's escalating costs.

Washington state has since recommended and established financing structures with steadier levels of debt service payments for subsequent tolled transportation facilities, supporting better management of the state's debt burden and a lower financial burden for toll ratepayers.

(2) The Tacoma Narrows bridge facility debt service structure resulted, in part, from a decision by the legislature to fund construction of the bridge without drawing from state tax dollars.

As a result, toll revenue was committed to fund ((ninety-nine)) 99 percent of bridge construction costs, as well as the associated interest payments and other associated debt service costs.

This is not the standard more recently utilized by the legislature, as is the case of the state route 520 bridge's construction, ((seventy-two)) 72 percent of which is to be paid for with toll revenues.

In light of the maximum burden for bridge construction that was placed on Tacoma Narrows bridge toll ratepayers, there is no equitable reason that the burden of future debt service payment increases should be borne by these same toll ratepayers.

(3) The legislature established the Tacoma Narrows bridge work group in 2017 and tasked it with identifying opportunities for long- term toll payer relief from increasing toll rates on the Tacoma Narrows bridge.

The work group recommended a request of up to ((one hundred twenty-five million dollars)) $125,000,000 in state funding from the legislature to offset future debt service payment increases, allocated across the remaining years of tolling at levels that result in maintaining toll rates at fiscal year 2018 levels.

(4) Due to the findings aforementioned, an alternative is put forward by the legislature.

State contribution loans for each fiscal biennium are to be made through the life of the debt service plan of up to a total of ((eighty-five million dollars)) $85,000,000, and will be repaid in annual amounts beginning after the debt service and deferred sales tax are fully repaid.