The Public Works Trust Fund began in the 1980s as a “grand bargain” between the state, local governments and the business community. The idea was to create a revolving loan fund so local governments would always have a source for low-cost infrastructure financing.
Local ratepayers and businesses agreed to tax themselves to fund this program and invest in the future. Residents benefited because the total cost of the projects could be almost half as expensive.
After 30 years, the Public Works Trust Fund has sent almost $3 billion to local governments to help pay for projects like road repairs and sewer improvements.
Despite billions of dollars in loans made, there has never been a default on any funded project. Loan repayments from cities in one part of the state help pay for new low-interest loans for cities in another.
The program was so successful that it became a national model.
But in 2009, Washington state lawmakers couldn’t resist taking money from the fund in order to balance the state’s operating budget. And they have been taking it ever since. The continued raid now totals close to $1.5 billion.
This is like a farmer eating his seed corn. It addresses a short-term problem, but it is not a smart long-term strategy.
The Legislature’s continual sweeps of the fund have stalled the program to the extent it has not been able to make any new infrastructure loans for the past five years.
However, this year there is a chance to get the funds moving again. Both the House and the Senate budgets propose restarting the program at a modest level — which is a good sign.
The House and Senate are currently debating how much tax and loan repayment dollars to retain in the fund and whether to pass a reform bill, SB 5033, that will focus on communities in need, and institute reforms to ensure the state is investing in high-value infrastructure.
Even if tough choices must be made, it only makes sense to retain at least the remaining tax streams and loan repayment dollars to rebuild this program and help construct the next generation of Washington's infrastructure.
Kennewick has benefited from the trust fund to finance many past projects, which include upgrades to the Water Treatment Plant and street improvements to 10th Avenue. These were made at a great savings to our residents.
This fund helps communities maintain affordable user rates, prepare for economic growth and protect our environment. We need to get it started up again.
You can help by contacting our local legislators – Sen. Sharon Brown, Rep. Larry Haler and Rep. Brad Klippert. Please ask them to support the House-passed version of SB 5033.
Retaining the remaining taxes and loan repayments to invest in our collective future just makes sense.
Steve Young is the mayor of Kennewick