City extends, improves agreement with Metro for streetcar operations

This morning, the Council’s Sustainability and Transportation Committee advanced an extension of the interlocal agreement between SDOT and King County Metro for operation and maintenance of the two existing streetcar lines on First Hill and in South Lake Union.

The current agreement, signed in 2014, expires at the end of December. Under the agreement, Metro operates the two existing lines on behalf of the City.

There are some notable changes in the new agreement that improve upon the existing one:

  • The agreement is extended for another five years, and the city has options to extend it for an additional two five-year terms.
  • Metro will continue to make a financial contribution to subsidize the South Lake Union line. This year its contribution is $1.55 million; that will escalate by 3% for each of the next five years. If the city exercises its option to renew for another five years after that, the city and county will have a conversation about continuing the subsidy.
  • Budgeting will be less speculative. Under the current contract, the city’s payments to Metro were set at the beginning of the contract, and “trued up” at the end of every year. Because the two lines fell significantly below ridership projections, the city ended up making larger than expected payments to cover the farebox deficit. Under the new agreement, the charges are set through an annual, iterative process based on historical actuals, with a monthly reconciliation.
  • Responsibility for several tasks, including regular maintenance and custodial services, will shift from the city to Metro. That includes cleaning the streetcar stops. Also, Metro will take over maintenance of the First Hill streetcar maintenance facility (it already maintains the SLU facility).
  • Safety and security responsibilities will be owned by Metro, including accident investigations, required notifications to the state and federal governments, and compliance with new federal regulations such as creating a mandated safety plan.

According to SDOT officials, while the agreement does not explicitly include any provisions for operation and maintenance of the Center City Connector streetcar (if built), it is structured so that it can easily be extended to cover maintenance and operations of the new line without negotiating a new agreement.

The $1.55 million subsidy is a bigger deal than it sounds; it is one of two subsidies that is helping to keep the existing streetcar lines afloat. The other, $5 million a year from Sound Transit, supports the First Hill line and expires at the end of 2023. That will also need to be renegotiated in the next few years — and Initiative 976’s dramatic cuts to Sound Transit’s funding casts a dark shadow over it.

The County Council must also approve the agreement; it voted it out of its Mobility and Environment Committee yesterday and expects to approve it within the next two weeks.