PORT OF SEATTLE 
MEMORANDUM 
COMMISSION AGENDA               Item No.      6a 
ACTION ITEM 
Date of Meeting      August 9, 2016 
DATE:    August 2, 2016 
TO:      Ted Fick, Chief Executive Officer 
FROM:   Geri Poor, Regional Transportation Manager 
Lindsay Wolpa, Regional Government Affairs Manager 
SUBJECT:  South Lander Street Grade Separation Project Memorandum of Agreement (MOA) 
Amount of This Request:        $5,000,000   Source of Funds:  Tax Levy 
ACTION REQUESTED 
Request Commission authorization for the Chief Executive Officer to execute a Memorandum of
Agreement (MOA), substantially as drafted, with the City of Seattle, obligating the Port to
contribute $5 million to the City for the Lander Street Grade Separation Project. 
SYNOPSIS 
South Lander Street is an important east-west corridor in Seattle's SODO neighborhood, serving
traffic from freight, daily commuters, pedestrians, bicyclists and King County Metro. The Seattle
Department of Transportation (SDOT) will build a bridge over the train tracks on South Lander
Street between 1st Ave S and 4th Ave S to improve local traffic circulation, rail operations and
safety in SODO. With funds secured recently from several sources, the City is seeking to finalize
the design of the grade separation in summer 2017 and begin construction early the following
year. The City has requested that the Port become a financial partner for the project. 
BACKGROUND 
The South Lander Street Grade Separation Project was first proposed almost 20 years ago. In
conjunction with the Freight Action Strategy for Seattle-Tacoma (FAST) Corridor Partnership,
the Port of Seattle has supported this project since 2002. 
Established in 1998, FAST pursues funding for high-priority projects for transportation
improvements along the Puget Sound corridor between Everett and Tacoma. FAST is a
partnership of state, local, and regional agencies, including Puget Sound ports, and the railroads.
Its goals are to improve mainline rail capacity and connectivity, eliminate roadway chokepoints
where rail and arterial roads intersect, provide safe rail crossings in communities, and establish
reliable truck links between ports, rail yards, and freight distribution centers. 


Template revised May 30, 2013.

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
August 2, 2016 
Page 2 of 5 
In the past, the Port's support of the Lander project was for regional freight mobility within the
Duwamish Manufacturing Industrial Center (Duwamish MIC), reduced railroad at-grade
crossings (intermodal and all other trains), and for resiliency and redundancy (especially for local
traffic since the majority of regional container trucks use existing grade separated freeway access
on Spokane Street and SR-519/Atlantic Street). The project was stalled in 2008 after further
design work resulted in significant cost increases. Funding from the Bridging the Gap levy was 
redirected to the Mercer Street project. Re-embarking now, the City is taking a fresh approach
and intends to build the bridge to heavy haul standards. According the City's project manager,
the total cost is estimated at $140 million, slightly lower than the last estimate. 
On July 7, with the support of U.S. Senators Patty Murray and Maria Cantwell, the City was
awarded a FASTLANE grant of $45 million for the South Lander Street Grade Separation
project. This is additive to funding commitments already in place: $7 million committed from the
state, $20 million from city funds (through the 2015 Move Seattle transportation levy), up to $8
million in grant money from the Freight Mobility Strategic Investment Board (FMSIB), $9.5 
million in federal grant funds recommended through the Puget Sound Regional Council, and $5
million from BNSF Railway Company. The Port has already been an active supporter of the
project by sending letters of support for the FMSIB and federal grant proposals and we will
continue to support the City with their solicitations of other funders for the project. We
understand that a $40.5 million gap remains for full funding, after the anticipated contribution by
the Port. 
To fill their additional funding gap, SDOT staff shared with Port staff that they intend on seeking
funds from Sound Transit, King County (Metro) and maybe others. Port staff suggested that they
consider approaching private sector partners as well. SDOT staff insists that an early financial
commitment by the Port is crucial to successfully securing funds from the other partners. 
PROJECT JUSTIFICATION AND DETAILS 
The project will be a grade separated overpass on South Lander Street between 1st Ave S and 4th 
Ave S. While the project design has not yet been finalized, SDOT staff anticipates that the final
cost of the project will be approximately $140 million, including both design and construction. It
will be built to heavy haul standards. SDOT engineers are reevaluating the project's earlier
design to see how costs can be reduced by increasing efficiencies while maintaining project
goals. Should the Port Commission authorize executing the attached agreement, Port staff will
remain involved in the design process and in ensuring our needs are met. 
Justification for the Port of Seattle's contribution to the project includes an indirect benefit to
container terminals as we anticipate that it will remove some congestion to the primary east-west
corridors for container trucks, SR-519 and Spokane Street to access I-5 and I-90. In addition, it
will provide an alternative to Holgate Street, currently a more popular option for port trucks than
Lander Street. Beyond that, SDOT anticipates that the new overpass will provide relief for
approximately four and a half hours of delay from train traffic. In turn, this will offer a decrease
from air emissions given the minimized idling time. One additional benefit for everyone will be

Revised March 28, 2016 

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
August 2, 2016 
Page 3 of 5 
the improved safety  conflicts among cars, bikes, trains and pedestrians at this site have led to
several fatalities. 
Project Objectives 
The project aims to improve local traffic circulation, rail operations and safety in the SODO
neighborhood. It will improve freight train movements for more than 3,000 rail cars and reduce
truck delays, congestion, and emissions for more than 13,000 vehicles each weekday. 
Schedule 
The City anticipates completing design work to 30 percent in September 2016. They hosted a
public open house on the project in early June and intend to hold a follow-up event sometime
this fall. Target completion for the final design is summer 2017. Construction is estimated to
begin early 2018 be completed by early 2020. 
FINANCIAL IMPLICATIONS 
Project Cost Breakdown 
Lander St Overpass Port participation                                $5,000,000 
Budget Status and Source of Funds 
The 2016 Plan of Finance includes $1,700,000 for this project as a future use of tax levy fund.
This agreement for $5,000,000 is 3,300,000 more than the estimate included in the tax levy
presentation last October. The funding source for this agreement will be the tax levy. 
Financial Analysis and Summary 
CIP Category             Regional Transportation 
Project Type              Freight Mobility 
Risk adjusted discount rate     NA 
Key risk factors             A potential risk factor is that the delivered project does
not provide the expected benefit to the Port. This risk is
mitigated by the clause in the MOA that requires the City
of Seattle to collaborate with the Port on any design
changes that impact the Port's expected benefit. In the
event the Port's expected benefits are reduced by these
changes, and the parties cannot agree on a resolution, the
Port has the option to terminate the MOA and would not
be required to pay for any construction work it has not
approved and that has not been completed. 
Project cost for analysis        NA 
Effect on business performance  Spending on this project will be expensed as incurred, as a
non-operating expense over the city's construction period. 
IRR/NPV             NA 


Revised March 28, 2016 

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
August 2, 2016 
Page 4 of 5 
STRATEGIES AND OBJECTIVES 
Contributing to this project would indirectly support several aspects of the Century Agenda. The
project could lead to improvement in the region as a logistics hub in allowing improved traffic
flow outside cargo terminals and minimizing emissions from fewer idling vehicles. In
implementing the project, the City of Seattle and the Port of Seattle will collaborate to maximize
the opportunities and participation of minority-owned, women-owned, and disadvantaged
businesses, including those small businesses within the Seattle-Metropolitan region, within the
rules and regulations of federally funded projects.
ALTERNATIVES AND IMPLICATIONS CONSIDERED 
Alternative 1  Contribute nothing to the project. 
Cost Implications: zero 
Pros: 
(1)  Savings for the Port of Seattle. 
(2)  Available funding can go to other priority projects. 
Cons: 
(1)  Negative implications to the Port's relationship with the City of Seattle and other
industry partners that support the project. 
(2)  No ability to influence the design of the project. 
This is not the recommended alternative. 
Alternative 2  Contribute $10 million to the project. 
Cost Implications: $10 million 
Pros: 
(1)  Could potentially offer greater influence over project details. 
(2)  Could benefit other Port of Seattle priorities in consideration by the City of Seattle. 
Cons: 
(1)  Creates a new precedent in the Port's financial participation with in other agencyled
projects. 
(2)  Takes away near-term spending for other Port high priority projects 
This is not the recommended alternative. 


Revised March 28, 2016 

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
August 2, 2016 
Page 5 of 5 
Alternative 3  Contribute $5 million to the project. 
Cost Implications: $5 million 
Pros: 
(1)  Offers some level of influence over project details. 
(2)  Represents an accurate level of participation for where the project falls on priorities
for Port capital projects. 
Con: 
(1)  Even with this contribution and the federal grant, there remains a funding gap for
the project, thus the project still might not move forward. 
This is the recommended alternative. 
ATTACHMENTS TO THIS REQUEST 
Computer slide presentation. 
Memorandum of Agreement with the City of Seattle 
Agreement attachments 
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS 
None. 









Revised March 28, 2016