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July 30, 2013 1 EXHIBIT A 2 3 4 GCB 1140 5 SR 99 6 ALASKAN WAY VIADUCT REPLACEMENT PROGRAM 7 Funding Agreement 8 9 10 THIS AGREEMENT ("Agreement") for the Alaskan Way Viaduct Replacement 11 Program ("PROGRAM") is made and entered into between the State of Washington, 12 hereinafter the "STATE," and the Port of Seattle hereinafter the "PORT," collectively the 13 "Parties" and individually the "Party." 14 15 WHEREAS, in the 1950s, the City of Seattle ("City") and the Washington State 16 Department of Transportation jointly designed and built the Alaskan Way Viaduct to 17 accommodate passenger and freight mobility into the foreseeable future; and 18 19 WHEREAS, the central waterfront section of the Alaskan Way Viaduct passes through 20 and is adjacent to downtown Seattle's urban core and the Seattle waterfront; and 21 22 WHEREAS, the Duwamish and Ballard-Interbay industrial areas in Seattle are served 23 by the SR 99 corridor and constitute a significant portion of Seattle's maritime and 24 industrial sector jobs and annual city-wide revenue; and 25 26 WHEREAS, in 2001 the Nisqually earthquake damaged the Alaskan Way Viaduct; and 27 28 WHEREAS, the Alaskan Way Viaduct is at risk of sudden and catastrophic failure in an 29 earthquake and is nearing the end of its useful life; and 30 31 WHEREAS, a failure to maintain the Alaskan Way Viaduct capacity would result in 32 unacceptable congestion for freight and other traffic within and between Seattle's harbor 33 and industrial areas; and 34 35 WHEREAS, in March 2007, the Washington State Governor, the King County 36 Executive, and the Mayor of Seattle pledged to advance a series of key SR 99 projects 37 (Moving Forward Projects) that will facilitate the removal and/or repair of key portions 38 of SR 99, including the Yesler Way Vicinity Stabilization Project, the Electrical Line 39 Relocation project, Battery Street Tunnel Fire and Life Safety Upgrades, SR 99 Lenora to 40 Battery Street Tunnel Improvements, the SR 99 South Holgate Street to South King 41 Street Viaduct Replacement Project, Transit Enhancements and Other Improvements; and 42 43 WHEREAS, in January 2009, the Governor of Washington State, the Mayor of Seattle 44 and the King County Executive jointly recommended replacing the Alaskan Way Viaduct 45 with a bored tunnel beneath downtown Seattle in conjunction with improvements in GCB 1140 Page 1 of 10 July 30, 2013 1 surface streets and transit service, and Port of Seattle Chief Executive Officer, Tay 2 Yoshitani, endorsed the deep-bore tunnel concept; and 3 4 WHEREAS, the PROGRAM includes system-wide projects led by the Washington State 5 Department of Transportation (such as Holgate to King viaduct replacement, Atlantic 6 Street overcrossing, SR519 Phase 2, New Alaskan Way, Connection to Elliott 7 Avenue/Western Avenue, SR 99 Bored Tunnel, new connections at the north and south 8 portals), King County (such as South End Transit, North End Transit and other transit 9 investments), the City (such as Spokane Street Viaduct, Mercer Corridor, Central seawall 10 replacement and First Avenue Street car study) and the PORT (East Marginal Way Grade 11 Separation), anticipated to total $4.2 billion; and 12 13 WHEREAS, the Washington State Legislature passed ESSB 5768 and the Governor 14 signed the bill into law designating and funding the SR 99 Bored Tunnel Project as the 15 replacement for the Viaduct; and 16 17 WHEREAS, the STATE executed a design-build contract with Seattle Tunnel Partners in 18 January 2011 for the design and construction of the SR 99 Bored Tunnel Project as a 19 replacement for the Alaskan Way Viaduct as part of the PROGRAM; and 20 21 WHEREAS, the STATE issued a Supplemental Draft Environmental Impact Statement 22 meeting the requirements of the National Environmental Policy Act and State 23 Environmental Policy Act in 2010, issued a Final Supplemental Environmental Impact 24 Statement and Section 4(f) Evaluation in July 2011 and issued a Record of Decision in 25 August 2011 for the SR 99 Bored Tunnel Project; and 26 27 WHEREAS, as outlined in the Parties' prior Memorandum of Agreement No. GCA 6444; 28 the STATE and the PORT are committed to a replacement for the Viaduct that will 29 improve transportation access to and along the Seattle waterfront, including access for 30 over eight million annual ferry riders; ensure connectivity and capacity between the 31 Ballard-Interbay and Duwamish industrial areas and Seattle-Tacoma International 32 Airport, including a corridor for oversized vehicles; provide access to port cargo, fishing 33 and cruise facilities; minimize construction disruption; and increase opportunities for the 34 public and freight to access the shoreline and waterfront; and 35 36 WHEREAS, the PORT's international trade, aviation, economic development, tourism 37 and passenger terminal activities are vital to the economic growth of the region and the 38 state, supporting nearly 194,000 jobs in the region, and the STATE and the PORT 39 support infrastructure improvements necessary to achieve growth in trade and jobs and 40 increase the region's competitiveness in global markets; and 41 42 WHEREAS, the Viaduct corridor is crucial to the region's freight mobility because it 43 provides for 1.5 million freight trips annually by grade-separation of through traffic, rail 44 lines and industrial corridors near the Port's marine terminals, which support the 45 movement of $30 billion in international and domestic cargo through the Port each year; 46 and GCB 1140 Page 2 of 10 July 30, 2013 1 2 WHEREAS, the STATE has designed and is constructing improvements, also known as 3 AWV S Holgate to S King St Stage 3 Atlantic St Bypass Project, to the surface street 4 system in the vicinity of the corridor segment from S. Holgate Street to S. King Street 5 that are designed to increase access to Terminal 46 and other port waterfront facilities. 6 This project provides a new overcrossing at South Atlantic Street which will significantly 7 improve freight hauling efficiency between the Port and Interstate 5 and Interstate 90, 8 allowing trucks to bypass the frequent and lengthy railroad track blockages across South 9 Atlantic Street; and 10 11 WHEREAS, the STATE's contractor is designing and will construct the SR 99 Tunnel 12 Alternative, Tunnel Design Build (also known as, the SR 99 Bored Tunnel Project), and 13 the PORT has reviewed its design scope and determined that, when completed, it will 14 offer a direct benefit to the PORT by maintaining throughput capacity in the SR 99 15 corridor; keeping additional traffic off I-5; and minimizing construction disruption to 16 regional traffic, industrial and maritime businesses, and PORT facilities; and 17 WHEREAS, the STATE and the City are designing and will construct other projects 18 included in the PROGRAM that will maintain and improve traffic flow along the Seattle 19 waterfront and between the Seattle waterfront and STATE highways; and, 20 21 WHEREAS the STATE has developed a plan for delivering the PROGRAM that 22 includes: (i) the SR 99/Tunnel Alternative, South Access Connection Project that will 23 facilitate freight movement to and from PORT container terminals along East Frontage 24 Road, South Atlantic Street, South Royal Brougham Way, Alaskan Way South, East 25 Marginal Way South, and South Dearborn Street; and (ii) the SR 99/Tunnel Alternative, 26 North Access Connection Project that will ensure access to PORT cargo, fishing and 27 cruise facilities via the tunnel or north end arterials, including Sixth Avenue North, North 28 Republican Street, Dexter Avenue North, Aurora Avenue, and two-way North Mercer 29 Street; and, 30 31 WHEREAS, the STATE has proposed that the PORT assist with the funding of the SR 99 32 Tunnel Alternative, Tunnel Design Build; the SR 99/Tunnel Alternative, South Access 33 Connection Project; and the SR 99/Tunnel Alternative, North Access Connection Project 34 hereinafter identified individually as the "PROJECT" and collectively as the 35 "PROJECTS" and the PORT deems the PROJECTS to provide a direct benefit to the 36 PORT; and 37 38 WHEREAS, the STATE will construct the PROJECTS using the design-build and 39 design-bid-build methods of project delivery; and 40 41 WHEREAS, the Parties executed Memorandum of Agreement No. GCA 6444, Alaskan 42 Way Viaduct and Seawall Replacement Program Bored Tunnel Alternative on April 12, 43 2010 in which the PORT agreed, to the extent feasible and authorized by the Port 44 Commission, to fund or procure funding within the life of the PROGRAM not to exceed 45 Three Hundred Million Dollars ($300,000,000) toward the STATE's PROGRAM elements 46 with the majority of the PORT's contribution occurring between 2016 and 2018; and GCB 1140 Page 3 of 10 July 30, 2013 1 2 WHEREAS, the PORT allocated Twenty-Five Million Dollars ($25,000,000) of up to 3 Three Hundred Million Dollars ($300,000,000) for funding of transportation projects 4 serving the SR 99 system; and 5 6 WHEREAS, the Parties agree that the PORT has contributed Nineteen Million Dollars 7 ($19,000,000) of the Twenty-Five Million Dollars ($25,000,000) towards funding of the 8 East Marginal Way Overpass, Spokane Street widening, Duwamish Intelligent 9 Transportation System and the SR 519 South Seattle Intermodal Access Project Phase 2 10 projects that complement the PROGRAM and provide capacity for future growth and 11 improved safety; and 12 13 WHEREAS, the STATE has requested that the PORT's contribution toward funding of 14 the PROJECTS begin on May 1, 2015; and 15 16 WHEREAS, the PORT would incur additional costs associated with issuing bonds prior 17 to 2016; and 18 19 WHEREAS, the PORT has incurred additional costs associated with staffing 20 requirements for assisting the STATE in developing the design, coordinating construction 21 and other activities required to successfully complete the PROGRAM, including the 22 PROJECTS; and 23 24 WHEREAS, the Parties wish to provide the terms and conditions of the PORT's future 25 contribution towards funding the PROJECTS; 26 27 28 NOW, THEREFORE, by virtue of RCW 53.08.330, RCW 53.08.340 and RCW 29 47.28.140 and in consideration of the terms, conditions, covenants and performances 30 contained herein, or attached and incorporated and made a part hereof, the Parties agree 31 as follows: 32 33 1.0 STATE RESPONSIBILITIES 34 35 1.1 The STATE will ensure that the PROGRAM will be designed and constructed to 36 facilitate efficient movement of freight and other traffic on the west corridors of the 37 Seattle transportation system between the Duwamish and Ballard-Interbay neighborhoods, 38 including maintaining access to fishing, cruise and other PORT facilities. The STATE 39 further agrees that, at a minimum, the reconstruction of the surface streets on the central 40 waterfront segment of the PROGRAM will include two lanes in each direction with left 41 turn lanes at intersections between Pine Street and the Colman Dock, and three lanes in 42 each direction south of Colman Dock with left turn lanes where needed. 43 44 1.2 The STATE will ensure that: (i) all environmental review and documentation has 45 been successfully completed and approved prior to construction of the tunnel, north portal, 46 south portal and central waterfront surface street projects; (ii) designs of PROJECTS are GCB 1140 Page 4 of 10 July 30, 2013 1 consistent with the STATE's and PORT's needs and provide the PORT with the direct 2 benefit that has been committed to by the Parties; (iii) the PORT has the opportunity to 3 review and comment on channelization plans prior to construction of each project in the 4 PROGRAM; (iv)it coordinates with the PORT prior to making any changes to 5 channelization plans that have been reviewed and commented on by the PORT; (v) all 6 costs of the PROJECTS funded with proceeds from PORT issued bonds meet the 7 requirements of the Internal Revenue Service ("IRS") for the use of tax exempt bond 8 proceeds; and (vi) that the PORT continues as a member of Maintenance of Traffic Task 9 Forces associated with construction of the PROJECTS. 10 11 12 2.0 PORT RESPONSIBILITIES 13 14 2.1 The PORT agrees to contribute Two Hundred Seventy-five Million Dollars 15 ($275,000,000) solely towards the costs of constructing the PROJECTS, less Seven 16 Million Three Hundred Thousand Dollars ($7,300,000) representing PORT costs for work 17 performed by PORT staff that is related to the PROGRAM, including the PROJECTS, 18 plus additional PORT costs associated with issuing bonds earlier than 2016 to meet its 19 obligations under Section 3.0, for a total PORT contribution not to exceed Two Hundred 20 and Sixty-seven Million, Seven Hundred Thousand Dollars ($267,700,000). 21 22 2.2 Subject to this Section 2, the PORT agrees to fund construction for the 23 PROJECTS, including mobilization, temporary erosion and sedimentation control, 24 earthwork, pavement, drainage, structures, and utilities in the amounts and according to 25 the schedule as described in Section 3.0 - Payment. 26 27 2.3 In addition to the total PORT contribution set forth in Section 2.1, the STATE 28 may, by no later than 2018, request an additional PORT contribution of up to Six Million 29 Dollars ($6,000,000) to assist in funding transportation projects identified by the STATE 30 as serving the SR 99 system. The Parties acknowledge and agree that PORT shall 31 determine in its sole and absolute discretion whether and how much to contribute under 32 this Section and, if so, how it will allocate any such contribution among the projects 33 identified by the STATE. Any additional PORT contribution under this Section 2.3 shall 34 be documented by attaching the minutes of the Port Commission authorizing such 35 contribution as Supplement 1 to this Agreement, thereby incorporating it herein without 36 further amendment. 37 38 2.4 The Port shall follow all requirements, included but not limited to I.R.S. 39 regulations, associated with bond proceeds arbitrage. 40 41 42 3.0 PAYMENT 43 44 3.1 Subject to Section 2, the PORT agrees to make payments to the STATE in the 45 amounts and according to the schedule set forth below: GCB 1140 Page 5 of 10 July 30, 2013 1 a. Upon receiving the STATE's request for payment no later than April 1, 2015, 2 the PORT shall make a lump sum payment of One Hundred Twenty Million Dollars 3 ($120,000,000) no later than May 1, 2015. 4 b. Upon receiving the STATE's request for payment no later than 5 April 1, 2016, the PORT shall make a lump sum payment of One Hundred 6 and Forty-seven Million Dollars ($147,700,000) no later than May 1, 7 2016. 8 9 3.2 All requests for payment by the STATE under Section 3.1 shall include copies 10 of contractor progress payments that support reimbursement to the STATE for actual 11 construction costs incurred for the PROJECTS. 12 13 3.3 In the event the PORT commits to an additional contribution under Section 2.3, 14 all requests for payment by the STATE therefor shall include copies of contractor 15 progress payments that support reimbursement to the STATE for actual construction 16 costs incurred for the project(s) identified in Supplement 1 to this Agreement. 17 18 19 4.0 MODIFICATIONS TO FUNDING OR SCOPE OF THE PROJECTS AND 20 AMENDMENT 21 22 4.1 The Parties may adjust the PORT's contributions to the Projects under Section 2.0 23 by written amendment reflecting changes to the Port's timing and contribution, except as 24 otherwise set forth in Section 2.3. In fulfilling its obligations under this Agreement, the 25 Port will at all times retain its duty to act in the best interests of the Port. 26 27 4.2 Either Party may request changes to the provisions contained in this Agreement. 28 Such changes shall be mutually agreed upon and incorporated by written amendment to 29 this Agreement, except as otherwise set forth in Section 2.3. No variation or alteration of 30 the terms of this Agreement shall be valid unless made in writing and signed by 31 authorized representatives of the Parties hereto, except as otherwise set forth in Section 32 2.3. 33 34 35 5.0 NOTIFICATION 36 37 5.1 Any notice required or permitted to be given pursuant to this Agreement shall be 38 in writing, and shall be sent postage prepaid by U.S. Mail, return receipt requested, to the 39 following addresses unless otherwise indicated by the Parties to this Agreement: 40 41 To the STATE: Linea Laird, P.E. 42 Program Administrator 43 Washington State Dept. of Transportation 44 999 Third Avenue, Suite 2424 45 Seattle, WA 98104 46 GCB 1140 Page 6 of 10 July 30, 2013 1 To the PORT: Tay Yoshitani 2 Chief Executive Officer 3 Port of Seattle 4 P. O. Box 1209 5 Seattle, WA 98111 6 7 8 6.0 RECORDS RETENTION AND AUDIT 9 10 6.1 The PORT or its designee shall have the right to inspect, audit and/or copy 11 records supporting or pertaining to the PORT's funding assistance to the PROGRAM and 12 accounting thereof for the purpose of determining anything that is of consequence to this 13 Agreement. 14 15 6.2 The STATE shall retain the records pertaining to or supporting the PORT's 16 funding assistance to the PROGRAM for the periods required below. The STATE shall 17 also ensure that relevant wage, payroll and cost records of all contractors, subcontractors 18 and suppliers at all tiers shall be retained and open to similar inspection or audit for the 19 periods required below: 20 a. During the progress of work related to the PROJECTS funded by the PORT; 21 b. For a period of not less than six (6) years after the PORT's final payment to 22 the STATE under this Agreement; provided that if tax exempt bonds are used to 23 provide funding assistance to the PROGRAM, the STATE shall retain records 24 necessary to address an IRS audit for the period required under applicable IRS 25 regulations; and 26 c. If any claim, audit, or litigation arising out of, in connection with, or related to 27 this Agreement is initiated, all documents and records shall be retained until such 28 claim, audit or litigation involving the records is resolved or completed, 29 whichever occurs later. 30 31 6.4 The STATE, its contractors, subcontractors and suppliers shall make a good faith 32 effort to cooperate with the PORT and its designees when the PORT gives notice of its 33 need to inspect or audit records referenced in this Section 6. Cooperation shall include 34 assistance as may be reasonably required in the course of inspection or audit, including 35 reasonable access to personnel with knowledge of the contents of the records being 36 inspected or audited so that the information in the records is properly understood by the 37 persons performing the inspection or audit. Cooperation shall also include establishing a 38 specific mutually agreeable timetable for making the records available for inspection by 39 the PORT and its designee. Unless otherwise agreed, if the STATE, its contractor, 40 subcontractors and suppliers cannot make at least some of the relevant records available 41 for inspection within twenty-eight (28) calendar days of the PORT's written request, 42 cooperation will necessarily entail providing the PORT with a reasonable explanation for 43 the delay in production of records. 44 45 46 GCB 1140 Page 7 of 10 July 30, 2013 1 7.0 DISPUTE AVOIDANCE AND RESOLUTION 2 3 7.1 Designated Representatives: 4 5 PORT: Anne Porter 6 Capital Project Manager V 7 Port of Seattle 8 Capital Development Division 9 P. O. Box 1209 10 Seattle, WA 98104 11 206-787-3133 12 13 STATE: Todd V. Trepanier 14 Deputy Administrator Operation 15 Alaskan Way Viaduct Replacement Program 16 999 Third Avenue, Suite 2200 17 Seattle, WA 98104 18 206-805-2813 19 20 7.2 The designated representatives herein under section 7.1, shall use their best efforts 21 to resolve disputes between the Parties. If the designated representatives are unable to 22 resolve a dispute, then the responsible project managers or directors for each Party shall 23 review the matter and meet as soon as possible, but in no case later than ten (10) business 24 days after request by either Party, to attempt to resolve it. If the project managers or 25 directors are unable to resolve the dispute, the matter shall be reviewed by the department 26 director or Chief Executive Officer of each Party or his or her designee. The department 27 director or Chief Executive Officer of each Party shall meet within ten (10) business days 28 of request by either Party after exhaustion of the previous procedural steps. If after that 29 meeting, the Parties are still not able to resolve the dispute, the Parties shall submit the 30 dispute to mediation. Representatives of each party with authority to settle the claim, or 31 in the case of the PORT, if Commission approval is required, management authority to 32 recommend settlement of the claim directly to Commission, shall participate in the 33 mediation. The mediator's fee will be divided equally among the parties participating in 34 the mediation. The Parties agree to exhaust each of these procedural steps before seeking 35 to resolve disputes in a court of law or any other forum. 36 37 38 8.0 EFFECTIVENESS AND DURATION 39 40 8.1 This Agreement is effective upon execution by both Parties and will remain in 41 effect until final completion of all Parties' obligations contained or referenced in this 42 Agreement, unless otherwise amended or terminated. 43 44 45 46 GCB 1140 Page 8 of 10 July 30, 2013 1 9.0 INDEMNIFICATION AND HOLD HARMLESS 2 3 9.1 Each of the Parties shall protect, defend, indemnify, and save harmless the other 4 Party, its officers, officials, employees, and agents, while acting within the scope of their 5 employment as such, from any and all costs, claims, judgment, and/or awards of 6 damages, arising out of, or in any way resulting from, each of the Party's own negligent 7 acts or omissions. The STATE shall also protect, defend, indemnify and save harmless 8 the PORT, its officers, officials, employees and agents ("PORT indemnified parties"), 9 from any and all costs, claims, judgment and/or awards of damages, arising out of, or in 10 any way resulting from the design, permitting, or construction of the PROJECTS or the 11 PROGRAM. In no event shall the PORT have any maintenance or repair obligation with 12 respect to Alaskan Way, or facilities lying in public right-of-way along Alaskan Way, or 13 arising out of or related to the PROGRAM or the PROJECTS. No Party will be required 14 to indemnify, defend, or save harmless the other Party, its officers, officials, employees 15 and agents if the claim, suit, or action for injuries, death, or damages is caused by the sole 16 negligence of the other Party. Where such claims, suits, or actions result from the 17 concurrent negligence of the Parties, the indemnity provisions provided herein shall be 18 valid and enforceable only to the extent of a Party's own negligence. 19 Each of the Parties agrees that its obligations under this Section extend to any 20 claim, demand and/or cause of action brought by, or on behalf of, any of its employees or 21 agents. For this purpose, each of the Parties, by mutual negotiation, hereby waives, with 22 respect to each of the other Party only, any immunity that would otherwise be available 23 against such claims under the Industrial Insurance provision of Title 51 RCW. 24 9.2. In the event of legal action challenging the PORT's legal authority to provide 25 funding assistance to the PROGRAM or the PROJECTS, the PORT, in its sole discretion, 26 may defend such legal action or may tender the defense to the STATE within ten (10) 27 business days after the service of such legal action. Failure to tender the legal action to 28 the STATE as provided herein shall constitute a waiver of PORT's right, if any, to seek 29 indemnity for the claims asserted therein. In the event that the PORT chooses to tender 30 to the STATE the defense of such legal action, and, to the extent permitted by law, the 31 STATE shall defend, pay the cost of such defense, save harmless, and indemnify the 32 PORT indemnified parties from any and all costs, claims, judgment and/or awards of 33 damages, arising out of, or in any way resulting from, such legal action. 34 35 9.3 The indemnification, hold harmless, and/or waiver obligations described in this 36 section shall survive the termination of this Agreement. In any action to enforce the 37 provisions of the Section, the prevailing Party shall be entitled to recover its reasonable 38 attorney's fees and costs incurred from the other Party. 39 40 41 10.0 VENUE 42 43 10.1 This Agreement shall be deemed to be made in the County of King, State of 44 Washington, and the legal rights and obligations of the STATE and PORT shall be 45 determined in accordance with the laws of the State of Washington. All legal actions in 46 connection with this Agreement shall be brought in the County of King, State of GCB 1140 Page 9 of 10 July 30, 2013 1 Washington. 2 3 4 11.0 RELATIONSHIP OF PORT AND STATE 5 6 11.1 Nothing contained herein shall be deemed or construed as creating the 7 relationship of principal and agent, partnership, or joint venture partners between the 8 STATE and the PORT. 9 10 11 12.0 AUTHORIZED SIGNATURES 12 13 12.1 The undersigned acknowledge that they are authorized to execute this Agreement 14 and bind their respective agencies to the obligations set forth herein. 15 16 IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the 17 latest date written below. 18 19 PORT OF SEATTLE STATE OF WASHINGTON 20 DEPARTMENT OF TRANSPORTATION 21 22 23 24 _____________________________ ______________________________ 25 By: Tay Yoshitani By: Linea Laird, P.E. 26 Chief Executive Officer Program Administrator 27 Alaskan Way Viaduct and Seawall 28 Replacement Program 29 30 Date: ________________ Date: ___________________ 31 32 33 APPROVED AS TO FORM: APPROVED AS TO FORM: 34 35 36 37 __________________________ _____________________________ 38 By: Isabel R. Safora By: __________________________ 39 Deputy General Counsel Assistant Attorney General 40 41 42 Date: ___________________ Date: _____________________ 43 GCB 1140 Page 10 of 10
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