Infrastructure funding underlies a fundamental premise of the Washington State Growth Management Act: that growth should occur where adequate facilities and infrastructure exist or are planned and funded to exist. However, since the passage of GMA, the public sector’s ability to build infrastructure has diminished. PSRC researched existing infrastructure funding programs and tools in Washington State, based upon the findings in a significant number of reports developed by multiple state-level and statewide stakeholders over the past few years. The report finds that local governments in Washington State are challenged to fund basic infrastructure such as sewer, water, parks and roads. The recession of 2008-2009 only made things tougher, with less tax revenue and less state aid funding.

Local challenges to funding infrastructure include loss of revenue from voter initiatives, rising material and land costs, fund usage restrictions and eligibility limitations, voter approval and super majority requirements, and more. For smaller jurisdictions, additional challenges include lack of economies of scale, limited and sometimes non-diversified tax bases, and limited access to private borrowing. Challenges to using state and federal sources include the complexity of state’s local aid system (which increases costs to participation), the need for better coordination among state programs, the lack of clear system-wide policy goals, and sometimes elaborate monitoring and reporting requirements.

The inability to make needed infrastructure available, in the face of population and job growth, has pushed many jurisdictions’ infrastructure facilities to their limits. The report concludes with recognition that because accommodation of growth remains a paramount duty for local governments under the Growth Management Act, jurisdictions will need to be flexible, creative, and show leadership in order to successfully develop the infrastructure necessary to implement their growth management plans.

This may require approaches such as greater use of voter-approved local taxes and fees, consideration of regional solutions, changes to level of service standards, adoption of demand management strategies, and more. At the state level, there is significant uncertainty regarding how the newly formed Department of Commerce will address its responsibility to comprehensively address infrastructure, as well as how future state budgets will backfill this year’s cuts to capital budget programs.

The report is available here. For more information, contact Ivan Miller at 206-464-7549 or imiller@psrc.org.