Newsletter: Special Edition on Taxes
As the Councilmember representing our District 4, I typically enjoy organizing topics into groups of 4 to explore. But this group of 4 is more daunting. As we are painfully aware, our city is facing 4 epic challenges:
- COVID: The pandemic continues to take lives even though we moved into “Phase 2” of our Governor’s plan to reopen the economy.
- DEFICITS: The COVID pandemic has dramatically reduced economic activity and revenues to our City’s treasury, creating a $300 million hole this year (2020) as well as another $300 million hole for next year (2021).
- SAFETY: Only eight months ago, several current members of our City Council approved the $400 million police budget that has come under intense scrutiny today. In the wake of the police killing of George Floyd and subsequent protests about police misconduct and institutional racism, those Councilmembers and newly elected ones like me are striving to re-imagine public safety and community wellness. This recent process has started with a focus on demilitarizing our Seattle police force and listening carefully to those communities that have experienced disproportionate negative impacts. For more on this, CLICK HERE and HERE. There is much work to do.
- INFRASTRUCTURE / BRIDGES: Our Seattle Department of Transportation suddenly closed the West Seattle high bridge (WSB) in March due to safety concerns and it will take several years to repair and/or replace. For more on the WSB, CLICK HERE. As a result of information learned during the WSB closure about inadequate maintenance funding, I launched a citywide bridge audit to review the condition of major bridges and their maintenance needs throughout Seattle. In addition, I believe we must renew our Seattle Transportation Benefit District, which is expiring this year (more below).
During these challenging times, I appreciate the leadership from our Mayor Jenny Durkan, our City Council President Lorena Gonzalez, and our King County Executive Dow Constantine. These elected colleagues and their strong teams are working hard to lead us through unchartered waters.
This Special Edition of our newsletter focuses on some tax proposals that are speeding forward on our City Council agenda and that could benefit greatly from YOUR input.
Take our Survey on City Tax Proposals:
- Our city government budget currently spends $1.7 billion for its flexible General Fund and $6.5 billion in total (including for infrastructure / transportation projects, Seattle City Light, and Seattle Public Utilities). Our city continues to face significant challenges such as homelessness and the COVID pandemic.
- The state government has a notoriously regressive tax structure that limits new options to raise city revenue. Thus far, all efforts to correct this in Olympia have failed.
- Some City Councilmembers proposed new payroll taxes on large Seattle employers. Among these are (A) Kshama Sawant ($500 million per year with no end date) and (B) Teresa Mosqueda ($200 million per year for 10 years). For context, the 2018 Head Tax that the previous City Council approved — and then reversed after public backlash — would have raised “only” $50 million. The final City Council vote on Councilmember Mosqueda’s proposal could occur as early as this Monday, July 6.
- As you may recall, I strongly critiqued Councilmember Sawant’s tax proposal in April. I’m concerned about imposing a new tax on Seattle employers during a deep recession if we actually want our employers to stay in Seattle and rehire as many workers as possible. At our July 1 Budget Committee, a majority of Councilmembers voted to move ahead with the Mosqueda “JumpStart” Tax rather than the Sawant Tax.
- Unfortunately, my colleagues at the July 1 Budget Committee rejected my reasonable amendment to exempt nonprofit organizations from the new tax. In addition, my colleagues conceded to a demand by Councilmember Sawant to remove a sensible 10-year “sunset” provision. As with many taxes in Seattle, a “sunset” is useful because it makes it easier for future City Councils to decide whether and how to renew and improve the tax. The remaining provision to “monitor proposals” from the State or County in case they enact business taxes is weak and unenforceable. Also, the decision was made to strip out Councilmember Mosqueda’s thoughtful spending plan — so now your City Council is put in the position of having to enact a tax without knowing the details of how it would spend the money. And no matter how we amend Councilmember Mosqueda’s Tax, it targets only Seattle employers; in other words, it’s not a regional tax. I would prefer a regional tax to prevent Seattle employers from relocating.
- While I have concerns with the “Jump Start” tax proposal from Councilmember Mosqueda, I have not concluded my position because I have been researching and considering it in the context of Mayor Durkan’s proposal to re-balance our 2020 budget and I would like more input from District 4 constituents (see survey below).
- For the legislation and all the amendments offered for Councilmember Mosqueda’s proposal, CLICK HERE for our July 1 Budget Committee agenda.
- It’s important to note that the JumpStart package is three ordinances: (1) the new payroll tax, (2) the long-term spending plan, and (3) short-term COVID relief. I have consistently supported COVID relief.
To take the survey, CLICK HERE. The survey is just two questions and will take less than 5 minutes: (1) In which neighborhood do you reside? and (2) this question on the tax proposals:
Pick the ONE statement that best describes your current views on the tax proposals:
- Yes on the Mosqueda Tax (“JumpStart”): We need more revenue and Teresa Mosqueda’s plan to raise $200 million a year is better than Kshama Sawant’s larger tax and it’s better than nothing. For example, Mosqueda’s “JumpStart” plan has a more tailored approach that calculates the tax only on higher salaries ($150,000 and above). Mosqueda’s spending plan is also more targeted to the lowest income households in Seattle. The benefits of a new tax on Seattle’s largest employers will likely outweigh any perceived risks.
- No New Taxes on Seattle Employers: Do not pass any new tax on Seattle’s employers this year. There are several reasons to vote No, including: the Mosqueda Tax (“JumpStart”) will make it harder on our employers during this economic downturn. Businesses already pay taxes to the city. These tax proposals are not regional solutions and taxes on payroll are essentially taxes on jobs when we need Seattle employers to stay in Seattle and provide more jobs to recover from this recession. And the Mosqueda legislation will tax nonprofits rather than just large corporations.
- Let the Voters Decide. Didn’t the City Council learn from the mess with the Head Tax in 2018 when they tried to impose an unwanted tax on Seattle businesses? Sending the proposal to the November ballot will also provide more time to see how the economy is recovering and/or for the State government to pass a better statewide or regional measure for revenue.
- Undecided: I would need to learn more about the tax proposals before deciding.
Political Reality on the Payroll Tax:
- I want to shape expectations on payroll taxes: the City Council is likely to pass this payroll tax in July whether I vote for it or against it. This is due, in large part, to who was elected to City Council in 2019 and their general views on taxing larger employers in Seattle. Four other Councilmembers quickly signed on as co-sponsors to Mosqueda’s “Jump Start Seattle” payroll tax: Gonzalez, Herbold, Strauss, and then Lewis. Moreover, our Governor and State legislature have been consistently unable to enact progressive taxes.
- The Budget Committee vote on July 1 was 7 to 2 to advance the Mosqueda bills to the full City Council (which has the same membership as the Budget Committee). Because some of my amendments to the Mosqueda measure failed, I voted No at the Budget Committee to provide a few more days to conduct this survey and think about the amended proposal. Councilmember Debora Juarez joined me in Voting No. (For all the amendments, CLICK HERE.)
Seattle Transportation Benefit District (STBD)
Next week I am poised to join the Mayor and others to announce a proposal to renew the successful Seattle Transportation Benefit District. I am hopeful that my City Council colleagues will collaborate and, without delay, put the STBD on the ballot for voters to consider this November.
While ridership is down due to COVID, transit remains an affordable transportation lifeline for essential workers and will undergird our economy as it reopens and revitalizes. In the first year of renewal, we also have a tremendous need to increase transportation options for the 100,000 residents of West Seattle until the bridge is repaired or replaced. Increasing transit ridership is also an important solution to address climate change and traffic congestion.
For details on STBD and the proposal to renew it, including Pros and Cons (and more Pros), CLICK HERE or my blog post next Tuesday afternoon, July 7 .
Re-Imagining Public Safety and Community Wellness:
It’s Time for 3-1-1
Most of my previous e-newsletter was dedicated to addressing police accountability issues in the wake of the protests following the police killings of George Floyd and the painfully long history of misconduct and institutional racism negatively impacting countless Black, Indigenous, and People of Color (BIPOC). Those challenges remain a priority focus of City Hall as we consider major new policies and actions. For more on that important issue, please CLICK HERE.
In reviewing the recent data on 9-1-1 calls showing approximately half of those calls are NOT emergencies involving potential crimes, it became clear to me that we need to implement something I have been advocating for years: a 3-1-1 Call Center open 24/7 to handle non-emergency calls. These 3-1-1 Call Centers have been working effectively for millions of residents in other big cities across our nation. It’s simply not effective or fiscally responsible to require highly paid, armed police officers to respond to every type of call received on 9-1-1. Here’s what I wrote in Crosscut in 2017:
- “Activate a 3-1-1 Call Center Available 24/7. Do what has worked well for more than a decade in cities from San Francisco to Chicago to New York: enable people to dial an easy-to-remember phone number (3-1-1) to request city services and report concerns, from potholes to policies. The City’s Customer Service Bureau is available ONLY on weekdays and Councilmember office hours for constituents are scant or inconsistent. Few can remember the City’s non-emergency phone number and it provides only minimal services. While the “Find It Fix It” technology works for some, a 3-1-1 Call Center open 24/7 will enable residents without access to fancy iPhones to receive the best customer service. A 3-1-1 Call Center will also make our communities safer by reducing the number of non-emergency calls to 9-1-1 operators. City managers and Councilmembers could use the 3-1-1 software system to track responsiveness and results for their constituents.”
Creating a robust 3-1-1 Call Center is certainly NOT anywhere close to a solution for our police accountability problems, but it is a partial answer to provide safer, more appropriate responses to residents who request help from their city government. When some folks say, “De-fund” the police,” a 3-1-1 Call Center provides some structure for how we might operationalize that aspirational goal in a way that provides customer service to our residents and community wellness tailored to community needs to supplement 9-1-1. It’s Time for 3-1-1.
For my previous newsletter that covers more facets of the need to reimagine public safety, please CLICK HERE.
Internet for All
co-sponsored by Council President Lorena Gonzalez
My staff and I have been gathering input on the draft Resolution I announced earlier to pursue Internet for All residents in Seattle.
- A RESOLUTION establishing the City Council’s goal to implement Internet for All Seattle, a vision of enabling all Seattle residents to access and adopt broadband internet service that is reliable and affordable.
We’ve enjoyed connecting with and learning from advocacy groups, national researchers, dedicated employees of our City’s Information Technology Department, and private sector providers of internet services. Next week we plan to formally introduce my Resolution so we can further address the Digital Divide in our high-tech city. I am very thankful for the support and leadership of co-sponsor Council President Lorena Gonzalez so that we can move forward on this Resolution during these busy times. For more info on the vision and rationale for Internet for All — and to read the Resolution — CLICK HERE.
King County is officially in “Phase 2” of Governor Inslee’s four-phase approach to reopening our local economy. While we are dismayed to see jurisdictions across the country suffering a spike in COVID cases, we are also seeing troubling numbers in our area — including among UW students. This is a sobering reminder of the importance to take precautions such as wearing masks and social distancing.
MORE UPDATES ON COVID AND RELIEF:
- The Seattle City Council continues to update its COVID-19 webpage which includes resources supporting workers, childcare, small businesses, and tenants/landlords.
- You can also visit Mayor Jenny Durkan’s centralized COVID-19 webpage, as well as the Mayor’s blog for additional updates. Additionally, our Seattle Office of Immigrant and Refugee Affairs has been translating and sharing information on COVID-19 in several languages. For links to OIRA’s fact sheets and other translated materials, go to their blog: https://welcoming.seattle.gov/covid-19/
- And for the latest from Public Health Seattle-King County, you can visit their website to track our region’s response to the virus.
WE WANT TO HEAR FROM YOU
City Council Meetings on the Internet
Listening: Even though City Council is not currently holding meetings in person in order to follow public health guidelines, you can still follow along by listening on your computer or phone by CLICKING HERE. You can also listen on your phone by calling 206-684-8566.
Commenting: You can also submit public comment by sending an e-mail to me at Alex.Pedersen@seattle.gov or to all 9 Councilmembers at firstname.lastname@example.org. Please remember to add “For City Council Meeting” in the comments. Now you can also phone into the meeting to speak directly to the Council live. For the instructions on how to register and call in, CLICK HERE. Sign up begins two hours prior to the meeting start time.
As I mentioned earlier, we received over 25,000 e-mails – an unheard of volume – in June, so I ask for your patience as we try to respond to those District 4 constituents who asked for a response. Either way, we read your e-mails and they have an impact. Thank you for taking the time to contact me.
Virtual Meetings with Your Councilmember Pedersen
I continue to schedule virtual in-district office hours, so we can chat by telephone or via Skype. Please continue to sign up through my website or by CLICKING HERE so I can hear your ideas, concerns, and requests. You can also just send an e-mail to email@example.com
For previous e-newsletters, visit my blog by CLICKING HERE.
We will get through this together, Seattle.
Councilmember Alex Pedersen
Seattle City Council, District 4