City Council member Mike O'Brien says he may seek outside funding, such as direct state funding or a new taxing source, for the millions the city has committed to pay to relocate utilities as part of Alaskan Way Viaduct reconstruction. Last year, when it adopted the deep-bore tunnel as its preferred viaduct replacement option, the city council agreed to pay approximately $250 million to move the utilities, part of its contribution to the viaduct-replacement project.

Those funds were supposed to come out of utility rate increases. However, O'Brien says that "in light of recent news about rate increases at City Light"—13.8 percent at the beginning of this year, plus a temporary 4.5 percent increase that goes into effect in May—as well as hundreds of millions in capital projects in the pipeline at both City Light and Seattle Public Utilities, "adding another $250 million in capital expenses for utility relocation for a transportation project doesn’t seem appropriate."

Over the next several years, according to a briefing by city council staff on Monday, the city will be on the hook for at least $475 million in "major utility projects," including cleanup of the Duwamish River, environmental improvements to meet federal water-quality standards, and a new City Light substation in South Lake Union.

"Some would argue that utility rates should pay for utility relocation," O'Brien says. However, noting that the state has already committed to paying for utility relocation on the south end of the current viaduct, at a cost of $20 to $30 million, he says, "I would argue that transportation should pay for utility relocation when it’s for a transportation use."

Ron Paananen, deputy director for the state department of transportation's viaduct replacement project, says the state is assuming, based on legislation adopted last year and a written agreement with the city, that the city will pay for the project by raising utility rates. "For transportation projects, it’s more the rule than the exception that utility relocations are paid for by the utility companies," Paananen says.

"The utilities are just piggybacking on highway and street right-of-way, pretty much free of charge, and when the transportation need is such that they have to move, our policy has almost always been that the utility companies move it at their expense."

Yesterday, Mayor Mike McGinn said he wasn't aware of any move to separate viaduct-related utility relocation from utility rates, and reiterated that the city "has made a commitment: It will be paid for out of your utility rates."