Tacoma City Council approved an ordinance Tuesday that directs an additional $6.2 million from Tacoma Rail’s operating fund to balance its budget by the end of this fiscal year.

Instead of a drop in activity or the economic downturn, Tacoma Rail officials say increased volumes at the Port of Tacoma and other business opportunities have forced the budget increase.

Tacoma Rail saw a rise in intermodal traffic in July and August as a result of the opening of the Grand Alliance, a consortium of shippers that includes Hapag-Lloyd, Orient Overseas Container Line, NYK Line, and ZIM Integrated Shipping that began operating on July 2 at the Port of Tacoma’s Washington United Terminal. The result? A spike in expenses related to personnel, fuel, and operating supplies put Tacoma Rail 29 per cent over budget. Similarly, commercial freight rail volumes are on pace to exceed the biennium budget by 17 per cent, according to Tacoma Rail officials. In August, Port officials reported a 20 percent increase in container volume activity compared to the same month last year. Last month, Port officials reported a 14.5 per cent year to date gain in international container volumes.

Officials also point to Tacoma Rail’s increased involvement with construction at Union Pacific’s service facility and a track expansion project at Targa Sound Refining as other reasons for the budget adjustment.

TPU’s Board of Directors reviewed the issue during its meeting Oct. 10. Tacoma City Council’s government performance and finance committee discussed the issue earlier this month. The ordinance had its first reading at the council meeting last week.

“This is definitely good news for Tacoma Rail as we have been able to take advantage of business opportunities for traffic growth beyond that budgeted two years ago,” said Tacoma Rail finance and technology manager Dan McCabe last week at City Hall. “Although Tacoma Rail expenses are expected to be over budget, so are the revenues.”