Sound Transit executes sale of green bonds to help fund light-rail extensions

Written by Jenifer Nunez, assistant editor

Sound Transit executed the sale of nearly $1 billion of green bonds that will help fund voter-approved regional transit projects, including construction of more than 30 miles of light-rail extensions.


“A growing number of investors want to see strong returns for both their portfolios and their planet,” said Sound Transit Board Chair and King County Executive Dow Constantine. “They need look no further than these green bonds, which will fund transportation projects that increase commuters’ mobility while reducing reliance on cars.”

Sound Transit’s first issuance of green bonds followed an announcement by the American Public Transportation Association (APTA) that Sound Transit is one of only two transit agencies nationally to attain the platinum level of participation in APTA’s sustainability commitment.

The bond issuance is fully compliant with International Capital Market Association (ICMA) Green Bond Principles, validated through an independent opinion commissioned from Sustainalytics. The firm concluded that “investors in Sound Transit green bonds can be fairly confident that their investments will result in positive environmental impact.”

Sound Transit’s credibility as a green bond issuer comes from its construction and operation of transit services. The agency observes formalized and independently monitored sustainability commitments across many areas of day-to-day business, from designing energy-efficient buildings to reducing fleet emissions to increasing recycling and composting.

In addition to APTA’s annual reviews, independent auditors annually evaluate Sound Transit’s compliance with International Organization for Standardization environmental management system criteria.

“I’m proud of Sound Transit’s issuance of green bonds, which I believe will help grow this segment of the bond market while also reflecting our region’s environmental values and helping meet the agency’s financial obligations,” said Sound Transit Board and Seattle City Council member Mike O’Brien, who advocated for the green bond strategy. “I hope these bonds help to incentivize more organizations to follow the high standards Sound Transit is setting.”

The bond sale, assumed in the agency’s long-range financial plans, will generate approximately $600 million in new proceeds to fund voter-approved transit expansions and refinance $398 million of previously issued bonds with higher interest rates, generating present value saving of more than $30 million.