The Sound Transit Board of Directors Thursday began its review of the agency’s 2012 budget and received a report on updated projections for agency revenues.
In 2012 Sound Transit is positioned to continue expanding transit services, but the national recession’s financial impact will continue to pose significant challenges, according to Sound Transit officials. Updated financial forecasts presented to the Board Thursday predict that 2009-2023 funding for implementing the 2008 Sound Transit 2 ballot measure will be slightly lower than assumed last year. While 2010 independent forecasts predicted a 24.7 percent reduction to the funding level assumed in 2008, the agency’s 2011 forecast predicts a 25.2 percent reduction, 0.5 percent lower than last year.
“Our latest projections reflect that despite some encouraging signs, our regional economy is not turning around as quickly as our independent forecasters predicted last year,” said Sound Transit Chief Financial Officer Brian McCartan. “This means Sound Transit will have to work that much harder to manage priorities and costs as we align our plans for implementing Sound Transit 2 with available funding.”
Under Sound Transit’s subarea equity framework, each of Sound Transit’s five geographic subareas faces a different financial picture. Revenues collected within each area’s boundaries must be used for projects that have been identified to benefit that subarea’s residents.
While the recession’s impacts extend region-wide, ongoing efforts to align projects and services with available funding are most challenging in South King County, where revenues are now projected to be 32.4 percent lower than at the time the Sound Transit 2 ballot measure was submitted to voters. The only subarea where revenues are projected to be higher than earlier expected is Pierce County.
In response to the recession’s impacts the Sound Transit Board began a process last year for realigning project and service expansions with expected revenues. That effort will continue as the Board reviews the agency’s 2012 budget.
Sound Transit receives the bulk of its funding through sales tax revenues and a smaller percentage from the Motor Vehicle Excise Tax and car rental tax within the Sound Transit District, which covers the urban areas of King, Pierce and Snohomish Counties. The recession has particularly impacted agencies that rely on sales tax revenues, which are driven by consumer spending.