Form revised December 4, 2006

FISCAL NOTE FOR NON-CAPITAL PROJECTS

Department:	Contact Person/Phone:	DOF Analyst/Phone:
Seattle Department of Transportation	Ethan Melone, 684-8066	Stephen Barham, 733-9084

Legislation Title:

AN ORDINANCE relating to the Seattle Streetcar; addressing the financing of operating, maintenance and capital costs of the Seattle Streetcar and authorizing agreements in connection therewith; authorizing an agreement with King County for operation and maintenance of the Seattle Streetcar; authorizing the creation of a City fund; authorizing the loan of funds from the City’s Consolidated (Residual) Cash Pool, or its participating funds, to the new fund; making an appropriation from the new fund; and reducing an appropriation in the 2007 Budget; removing a budget proviso that had restricted spending on streetcar operations.

· Summary of the Legislation:

This legislation authorizes actions and expenditures necessary to the operation of the Seattle Streetcar, including execution of an interlocal agreement with King County for operation and maintenance of the Streetcar by the County’s Metro Transit Division and negotiation and execution of sponsorship agreements that will provide revenues to support the City’s share of operation and maintenance costs.  The legislation creates a new fund (the Seattle Streetcar Fund), authorizes an interfund loan from the City’s Consolidated (Residual) Cash Pool to the new fund, makes appropriations from the new fund, and reduces an appropriation in the 2007 Adopted Budget. 

The new fund, to be administered by the Seattle Department of Transportation (SDOT), will allow the City to manage the South Lake Union line and any future Seattle Streetcar lines as a single line of business, providing clarity for financial management purposes.  The interfund loan (up to $2.2 million of principal and interest outstanding at any one time, to be repaid by December 31, 2018) will allow the City to fund the initial operation of the Streetcar without use of General Fund revenues, using the growing stream of sponsorship revenues to repay principal and interest on the interfund loan. 

The legislation also lifts a budget proviso on 2007 appropriations for operation of the Streetcar and approves a financial plan identifying the City’s anticipated sources and uses of funds for streetcar operations and maintenance.

· Background: (Include brief description of the purpose and context of legislation and include record of previous legislation and funding history, if applicable):

In July 2006, the City of Seattle began construction of a modern streetcar line that will provide transit service to the South Lake Union, Denny Triangle and Commercial Core neighborhoods.  This South Lake Union streetcar line is envisioned as the first line in a potential Seattle Streetcar network. 

During the planning phase of the South Lake Union line, the City began discussions with King County Metro regarding operation of the streetcar system.  The Office of Policy & Management prepared a Capital Financing and Operating and Maintenance Plan (City Clerk File 307392) for consideration by the City Council in April 2005.  The Council subsequently adopted Ordinance 121850, which stated the City's intent concerning funding of capital and operating costs and authorized negotiations for an interlocal agreement with King County Metro.

· Please check one of the following:

____ This legislation does not have any financial implications. (Stop here and delete the remainder of this document prior to saving and printing.)

_X_ This legislation has financial implications. (Please complete all relevant sections that follow.)

Appropriations:  This table should reflect appropriations that are a direct result of this legislation.  In the event that the project/ programs associated with this ordinance have appropriations that were, or will be, received because of previous or future legislation or budget actions, please provide details in the Notes section below.

Fund Name and Number	Department	Budget Control Level*	2007 Appropriation	2008 Anticipated Appropriation
Seattle Streetcar Fund	Seattle Department of Transportation	Streetcar Operations	$579,000	$1,778,000
Seattle Streetcar Fund	Seattle Department of Transportation	Debt Service	$2,000	$36,000
Transportation Operating Fund [10310]	Seattle Department of Transportation	Mobility-Operations [17003]	($815,000)
TOTAL			($234,000)	$1,814,000

*See budget book to obtain the appropriate Budget Control Level for your department.

Notes: The 2007 appropriations from the Seattle Streetcar Fund include $579,000 for payment to King County Metro for streetcar operations (consistent with Table 1 of Attachment B to the accompanying ordinance) and $2,000 for 2007 interest costs on the interfund loan from the Consolidated (Residual) Cash Pool to the Seattle Streetcar Fund at 4.75%. 

The existing 2007 appropriation from the Transportation Operating Fund is reduced by $815,000, the amount that SDOT was originally budgeted to pay for streetcar operation in 2007.   (Note that capital funding for development of the South Lake Union Streetcar Project in the 2007-2012 Adopted Capital Improvement Program will continue to be provided through the Transportation Operating Fund.)

The 2008 anticipated appropriations include $1,718,000 for payment to King County Metro for streetcar operations plus $60,000 in direct City costs, and $36,000 for 2008 interest costs on the interfund loan.  Appropriations for 2008 will be made through the 2007/2008 mid-biennium budget process.

Anticipated Revenue/Reimbursement: Resulting From This Legislation: This table should reflect revenues/reimbursements that are a direct result of this legislation.  In the event that the issues/projects associated with this ordinance/resolution have revenues or reimbursements that were, or will be, received because of previous or future legislation or budget actions, please provide details in the Notes section below the table.

Fund Name and Number	Department	Revenue Source	2007 Revenue	2008 Revenue
Transportation Fund (10310)	SDOT	Sponsorship Agreements	$414,000	$465,000
Transportation Fund (10310)	SDOT	Federal	$0	$131,000
Transportation Fund (10310)	SDOT	Interfund Loan	$167,000	$1,218,000
TOTAL			$581,000	$1,814,000

Notes:  These revenue sources are described in more detail in Attachment B (“Seattle Streetcar Operations and Maintenance Financial Plan”) to the accompanying ordinance.

Total Regular Positions Created Or Abrogated Through This Legislation, Including FTE Impact:  This table should only reflect the actual number of positions created by this legislation  In the event that positions have been, or will be, created as a result of previous or future legislation or budget actions, please provide details in the Notes section below the table.

Position Title and Department*		Fund Name	Fund Number	Part-Time/ Full Time	2007 Positions	2007 FTE	2008 Positions**	2008 FTE**
	N/A
	TOTAL

*   List each position separately

** 2008 positions and FTE are total 2008 position changes resulting from this legislation, not incremental changes.  Therefore, under 2008, please be sure to include any continuing positions from 2007.

Notes:

· Do positions sunset in the future?  (If yes, identify sunset date):

Spending/Cash Flow: This table should be completed only in those cases where part or all of the funds authorized by this legislation will be spent in a different year than when they were appropriated (e.g., as in the case of certain grants and capital projects).  Details surrounding spending that will occur in future years should be provided in the Notes section below the table.

* See budget book to obtain the appropriate Budget Control Level for your department.

N/A

Notes:

· What is the financial cost of not implementing the legislation? (Estimate the costs to the City of not implementing the legislation, including estimated costs to maintain or expand an existing facility or the cost avoidance due to replacement of an existing facility, potential conflicts with regulatory requirements, or other potential costs if the legislation is not implemented.)

Without this legislation, SDOT will not have the resources to begin operation of the Seattle Streetcar.  The benefits that Local Improvement District (LID) ratepayers are anticipating as a result of the LID assessment would be delayed.

· What are the possible alternatives to the legislation that could achieve the same or similar objectives? (Include any potential alternatives to the proposed legislation, such as reducing fee-supported activities, identifying outside funding sources for fee-supported activities, etc.)

No reasonable alternatives consistent with the Council’s prior financial policy guidance regarding operation of the South Lake Union streetcar have been identified.

· Is the legislation subject to public hearing requirements:  (If yes, what public hearings have been held to date, and/or what plans are in place to hold a public hearing(s) in the future.)

No.

· Other Issues (including long-term implications of the legislation):

None.

Please list attachments to the fiscal note below: