Like many agencies nationwide that are balancing transit operations and mega-project capital expansions, Sound Transit faces rapidly escalating costs in nearly every area of its work.
Capital and operating costs have risen significantly since voters approved the ST3 Plan in 2016, and they’re continuing to escalate faster than contemplated 10 or even five years ago. If the agency does nothing to counter these rising costs, combined with lower revenue projections, completing Sound Transit’s expansion program will become unaffordable.
This is a long-term challenge, projected to begin the 2030s, that Sound Transit’s staff and Board are taking proactive steps to solve.
Today the agency remains financially sound, with more than $8 billion in cash and investments and exemplary credit ratings that benefit regional taxpayers. Agency leaders are well positioned to develop and implement solutions that will affordably deliver the objectives of the ST3 program and set us up for success in the decades ahead.
What does "affordable" mean?
Two factors determine whether Sound Transit’s program is projected to be “affordable”: the agency’s ability to take out loans and bonds and its ability to pay them back.
Both factors have defined limits that Sound Transit must adhere to.
The first is referred to as debt capacity, All Washington government entities are required by state law to stay below their debt limits. (Specifically, Sound Transit’s debt cannot exceed 1.5% of the assessed valuation of real property located within the regional transit authority district.)
The second is debt service coverage. This is the ratio of the agency’s total revenue, minus operating costs, divided by debt service. Sound Transit Board policy requires the agency to maintain a specific threshold (it may not fall below 1.5 times its total debt service in any given year, or 2.0 times on average during the plan period.)
All transit agencies, especially those with major expansion programs that span decades, are constantly tracking and adjusting to ensure future affordability. Sound Transit models this through its Long-Range Financial Plan, which projects spending and revenue through 2046 (the life of the ST3 plan).
If projected debt capacity and net debt service coverage remain within prescribed limits, Sound Transit’s plan is considered affordable. If models forecast that the plan will become unaffordable at a point in the future, Sound Transit takes preventative action, as it’s doing now.
The Enterprise Initiative
The agency’s Fall 2025 Long-Range Financial Plan estimated an additional $34.5 billion needed to fully fund the ST3 program through 2046.
In May 2025, Sound Transit launched the “Enterprise Initiative,” a comprehensive effort aimed at delivering the maximum benefits of ST3 within available financial resources. This work includes analyzing how the region has changed since 2016 and factors in new conditions that have emerged since 2021.
When Sound Transit faced affordability challenges in the past, it turned almost exclusively to capital project scope reductions and schedule delays.
The Enterprise Initiative is different. Through this broader, more holistic approach, staff and Board members are considering all agency costs (including system and project planning, capital construction, service operations, and system maintenance), revenue sources, and financial policies — and the relationships between them.
Taking this agencywide perspective with the support and guidance of the Board will help set Sound Transit on a new and sustainable path going forward.
The path forward
The Enterprise Initiative is a three-step process to align our finances and project plans.
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In 2025, Enterprise Initiative work focused on setting a baseline of the known challenges the agency is facing.
Staff established four discrete Enterprise Initiative workstreams (planning and policy, service delivery, capital delivery, and finance) and began exploring cost-saving opportunities and trade-offs for each.
Staff also worked closely with Board members to define the challenge ahead and develop guiding principles for decision-making:
- Advancing regional connectivity
- Supporting future growth
- Prioritizing the passenger experience
- Protecting public investments with fiscal integrity
- Maintaining ST3 performance characteristics
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In March 2026, staff presented three approaches for a revised, affordable capital program. These concepts are not decisions. Each approach reflects different points of emphasis, in order to help the Sound Transit Board surface priorities and weigh trade-offs.
You can find details about these three potential approaches in the March 2026 Board retreat presentation.
Staff and Board members are also working together to incorporate cost savings opportunities. This could include project-level strategies (such as optimizing Link station designs) and programmatic ones that could support and benefit the entire portfolio of projects (for example, reducing procurement time).
And in addition to capital program work, the Enterprise Initiative includes three other workstreams:
- Identifying possible changes to policies and planning assumptions. This includes financial policies that can increase agency financial capacity, project delivery policies that could save time and open new lines and stations faster, and program policies to boost transit-oriented development, passenger access improvements, and sustainability.
- Confirming potential resiliency investments and other opportunities that help deliver reliable, cost-effective service. These could include predictive maintenance technologies that anticipate and address issues before they impact service, integrating real-time monitoring systems for rapid response, and optimizing asset management strategies to improve equipment lifespan.
- Recommending enhancements to agency financial capacity. These opportunities could include new partnerships, updated grant strategies, and other approaches within the Board’s authority to increase Sound Transit’s financial capacity.
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The Enterprise Initiative will culminate in updates to three important agency plans:
- First, an amended ST3 System Plan. Voters approved this plan in 2016, and the Sound Transit Board amended it to realign the capital program in 2021.
- Next, a new Regional Transit Long-Range Plan, which represents the agency’s goals, policies, and strategies to guide long-term development of the high-capacity transit system. The most recent plan was adopted in 2014.
- And ultimately, an affordable Long-Range Financial Plan. The Long-Range Financial Plan is a model, and Sound Transit’s obligation is to have that model balance out through 2046.
Learn more and get involved
You can expect to hear much more from Sound Transit as Enterprise Initiative work advances this spring and summer. Be sure to sign up for email project updates and follow us on social media.
In addition to more frequent updates on progress, staff will be conducting equitable public engagement throughout the region to gather feedback on your priorities and inform Board decision-making.
Take our survey and tell us what matters most to you and your community.
Public feedback will play an important role in Board decision-making. Sound Transit staff will synthesize survey responses and share them with Board members in early May. Staff will also combine this feedback with other input we receive through email and in-person events into a comprehensive engagement report, prior to the May 28 Sound Transit Board meeting.
Questions or other feedback to share after taking the survey? Email us at EnterpriseInitiative@SoundTransit.org.