Seattle City Council approves $9 million loan to restart downtown streetcar work

Design work will resume soon on the delayed downtown streetcar, but the project remains years from completion and still faces a multimillion-dollar funding gap.

The Seattle City Council on Monday approved a $9 million loan to the Seattle Department of Transportation (SDOT) to continue design and engineering work for the project.

The 1.3-mile segment, once slated to open in 2020, would connect Seattle’s two existing streetcar lines in First Hill and South Lake Union, which together carried about 1.7 million riders last year. SDOT projects building the new line would more than triple streetcar ridership.

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Mayor Jenny Durkan paused the project last year amid rising projected costs to build and operate the line. In January, Durkan said she wanted the city to go ahead with the project, but she has not yet signaled how she plans to fill a $65 million funding gap to build the line.

The $9 million loan will come from the city’s information-technology department and be repaid through the expected $143.5 million sale of the city-owned South Lake Union property known as the Mercer Mega Block.  SDOT would use the money to hire an outside consultant to do further design work, which would help the department come up with new cost and schedule estimates for the project.

The council approved the loan with a 6-1 vote Monday. Councilmembers M. Lorena González and Kshama Sawant were absent.

“Downtown is well covered by buses, and we have a light-rail line where the center city streetcar would go,” Herbold said.

Councilmember Sally Bagshaw supported the loan but raised concerns about the cost — “whether the juice is worth the squeeze” — and whether SDOT has sufficiently planned for the project’s impact on freight downtown. “But I do see the value of having a unified connected system.”

At recent meetings about the project, business representatives from downtown and the Chinatown International District urged council members to move ahead with the project. “Please keep your promise,” read one speaker’s sign.