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Originally published October 6, 2008 at 12:00 AM | Page modified October 13, 2008 at 9:06 AM

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Light-rail foes focus on worst-case figures

Opponents of Sound Transit's Proposition 1 call the ballot measure a $107 billion tax request, but that number represents an apocalyptic scenario rather than an actual cost estimate of the $17.9 billion proposal.

Seattle Times transportation reporter

Sound Transit's ballot measure

Proposition 1 would pay for construction of 34 additional miles of light-rail track, pay for more Sounder train service in the South End, a First Hill streetcar in Seattle and more express buses. If approved by voters, the tax increase of a nickel per $10 purchase is expected to last until at least 2038. Supporters and opponents of the measure are using vastly different numbers to make their case:

$69 a year

Sound Transit says the proposed tax increase would cost $69 per adult next year, or "about the same as a tank of gas." It is based on state tax models that show the tax equaling $125 for a typical household making about $65,000 a year. But the estimate does not include sales taxes paid by businesses, then passed on to consumers.

$17.9 billion

The official figure on the ballot. This represents estimated dollars for new projects, including inflation, short-term operations and finance fees, through 2023 when the system is supposed to be completed.

$22.8 billion

Includes official $17.9 billion number, plus about $5 billion in payments to retire debt after 2023.

$107 billion

Number featured in opposition advertising. It assumes catastrophic construction and operating-cost overruns, requiring the tax increase to stay in effect through 2053.

Source: Sound Transit plan documents; Washington Policy Center; notoprop1.org campaign

Foes of Sound Transit's Proposition 1 are using a campaign strategy well-suited to a time of economic turmoil: They're portraying the measure as a blockbuster, $107 billion tax grab.

That figure is roughly six times the agency's official cost estimate of $17.9 billion, which would pay to extend light-rail service to Lynnwood, Overlake and north Federal Way, along with increased bus and commuter-train service.

So where did opponents get such an inflated number, and is it true?

Not according to Sound Transit: "The clear intent is to suggest that the costs ... are far, far beyond what they really are," says transit spokesman Geoff Patrick.

It turns out the $107 billion is not really a cost estimate.

It is mathematical conjecture by Jim MacIsaac, a semiretired Bellevue engineer and longtime rail-transit critic. Using the agency's growth and inflation factors, he calculated the amount of tax dollars that Sound Transit could collect from 2009 to 2053, should voters pass Proposition 1.

Such a scenario, however, assumes catastrophic cost overruns, junk financing and zero political intervention if the agency ran amok.

Also, MacIsaac's estimate includes billions already earmarked for transit projects voters previously approved, including a rail tunnel to Capitol Hill and Husky Stadium. Regardless of the Nov. 4 vote, those are scheduled to open in 2016 using existing sales and car-tab tax.

Proposition 1 does seek to indefinitely extend the current sales tax drawn by Sound Transit, to help fund new projects and ongoing operations costs.

Even MacIsaac says he doesn't expect cumulative taxes collected by Sound Transit to reach $107 billion, unless future voters agree to spend more on what would be a future, third round of rail projects.

Sound Transit predicts that should Proposition 1 pass, the agency would pay its debts and repeal the sales-tax increase in 2038. But long before that, transit-board members hope for another ballot measure, as early as 2016.

"To be perfectly honest, if Phase 3 doesn't happen, they'd have to give us the rollback somehow," MacIsaac said in an interview.

MacIsaac says he has little confidence in the agency. Sound Transit's own Citizen Oversight Panel has repeatedly warned that the agency is lowballing its future operating expenses.

MacIsaac used the year 2053 on the premise that the agency would sell 30-year bonds in 2023, then charge the full tax rate for the term of the bonds. Sound Transit's plan says the agency's board of directors would reduce the sales tax when Proposition 1 projects were paid off, but there is no legally binding date for the tax to end.

Opponent Phil Talmadge, a former state Supreme Court justice, argues that even if the transit project stays on budget, which he doubts, the money would be better spent on bus-rapid-transit service, for van pools, or for fare reductions.

Sound Transit is not alone in seeking greater tax authority, but Proposition 1 is the biggest package of 22 transit measures around the country, according to the pro-transit Center for Transportation Excellence.

Trailing Seattle is a $10 billion bond measure in California, backed by Gov. Arnold Schwarzenegger, to help pay for a bullet train from San Francisco to Los Angeles. Voters in Los Angeles County are being asked for a half-cent sales-tax proposal, the same rate as Seattle's measure, to be shared among rail, buses and roads.

Despite its flaws, MacIsaac's "$107 billion" is a reminder to Seattle voters that nothing is guaranteed. Legally speaking, there is no cost cap on Proposition 1.

Sound Transit's promises about limiting taxes hinge on the agency's skill in staying on time and on budget.

King County Superior Court Judge John Erlick said as much last month, even while dismissing an opponent's lawsuit to put the $107 billion figure in the ballot title. Proposition 1, Erlick said, "does not authorize the collection of a specific amount of taxes over a specified period of time."

What it does do is set a sales-tax rate to raise money for a transit system, the judge emphasized.

Talmadge said you only have to look back to 1996, when voters passed the initial Sound Move plan — and then saw rail costs roughly double. The train tunnel to UW is late, while an underground First Hill station was dropped.

"They claimed they were only going to spend so much money; they failed miserably at that," he said.

Transit leaders reply they've gained control over costs — the first 14 miles of light rail from downtown to Tukwila are on track to open next year within a $2.4 billion estimate issued in 2001. But Proposition 1 includes some difficult projects, such as a U District tunnel and the world's first light rail on a floating bridge, across Interstate 90.

"We've gone well out of our way to be conservative," said Patrick, the agency spokesman. Sound Transit is budgeting roughly $330 million per mile for light rail — reflecting its hard lessons in the early going. A state-sponsored Expert Review Panel has concluded the estimates are reasonable.

To that, Talmadge replies: "If they really believe the $17.9 billion number, why didn't they ask for taxing authority for $17.9 billion, plus some small bit of cushion? They didn't do that."

Mike Lindblom: 206-515-5631 or mlindblom@seattletimes.com

Copyright © 2008 The Seattle Times Company

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