Transportation budget leaves tough decisions on how to pay for projects unsettled

As Gov. Jay Inslee prepared to sign the last transportation spending plan of his 12-year tenure Thursday, he described the bumpy road ahead for Washington lawmakers and his successor.

“Revenues are going to be strained for building roadways, preservation and maintenance, and improving highway infrastructure,” he said. “Project costs are increasing due to inflation, supply chain issues and competition for contractors.” 

This budget, he said, “sets a direction for some big conversations.” It tackles immediate funding challenges while recognizing “additional solutions will be necessary” in future sessions. 

A measure on the November ballot adds another layer of financial uncertainty.

Initiative 2117, if approved by voters, would repeal the Climate Commitment Act, which, so far, has generated more than a billion dollars for transportation spending from the auction of pollution allowances. And it’s counted on to provide hundreds of millions of dollars for years to come.

“It’s a fact that repealing the Climate Commitment Act would blow a hole in our already strained transportation funding,” Inslee said.

No lawmakers attended Thursday’s signing of House Bill 2134, which passed unanimously in the House of Representatives and the Senate. 

It builds on decisions in the two-year $13.6 billion transportation budget enacted last year. Overall it adds $1 billion in additional spending. 

Some of the bigger ticket items include $260 million for highway preservation, like fixing potholes and replacing highway expansion joints, and $150 million for continued work to remove culverts in compliance with a federal lawsuit.

Climate Commitment Act receipts account for $324 million in spending but none of the dollars can be expended until Jan. 1.

That money will go toward purchases of hybrid-electric fire engines, installing electric vehicle charging infrastructure, converting existing ferries to hybrid-electric power, and expanding air quality monitoring. Development of fusion technology and green hydrogen are also supported.

The state’s ferry system received lots of attention.

There’s dough to bolster hiring and training programs for the short-staffed Washington State Ferries and added clarity in how the state will pursue construction of up to five new hybrid electric 144-car ferries.

And there’s $100,000 going to the Joint Transportation Committee, a bipartisan, bicameral panel, to convene a work group to identify new revenue sources to keep the agency afloat as it approaches its 75th anniversary in June 2026. A preliminary report is due this December. 

This supplemental budget offers a way to proceed with replacement of the Portage Bay Bridge on a stretch of State Route 520 in Seattle between the Montlake Bridge interchange and Interstate 5.

When project bids came in hundreds of millions of dollars higher than budgeted, the Washington State Department of Transportation did not award a contract, waiting until lawmakers figured out how to cover the difference.

The answer they came up with covers a $78 million gap in the current budget cycle. For the remaining amount — estimated to be $770 million over several years – their solution counts on money not yet in hand from increasing tolls on the floating bridge and deferring the contractor’s payment of sales tax until the project is done.

On traffic safety, Inslee cited a pilot program to test different speed camera technology on Interstate 5 and increased efforts to hire more Washington State Patrol troopers.

Inslee didn’t get everything he wanted. He noted, as he frequently has in recent weeks, that lawmakers did not provide all the money he sought for his encampment initiative, which cleans up rights-of-ways and gets people into housing.

He requested $10 million for the Department of Transportation to continue its work cleaning up encampments along highways. In the final budget signed Thursday, the department only got $2 million.

“It’s not enough to meet the growing needs of those experiencing homelessness along our state roads,” he said. “Future legislators will need to address this lack of funding so we can continue this very successful program.”