Seattle Council Passes Tax on Business to Help Address Homelessness

Following more than five months of deliberation, the Seattle City Council passed an ordinance related to taxation, intended to help address homelessness.  The amended proposal establishes an annual tax of $275 per full time employee on the City’s largest businesses, those with revenues of more than $20 million  (about 3% of all businesses). The measure would generate an estimated $47 million annually and end on December 31, 2023.

The ordinance passed by a unanimous vote, with all nine councilmembers supporting it.

Selected highlights of the amended ordinance include:

Exempt Seattle’s small and medium-sized businesses, only applying to those with at least $20 million or more annually in taxable gross receipts as measured under the City’s existing Business & Occupation tax;

  • Apply only to the City’s approximately 585 largest businesses, or approximately 3% of all Seattle businesses;
  • Require large businesses to pay $275 per full-time equivalent employee working 1,920 hours per year (or about $0.14 per hour);
  • Include an evaluation of the economic impacts, and an independent oversight committee; and,
  • Exempt healthcare providers that provide at least 25% of their services to patients covered by Medicare and Medicaid as well as all hospitals.

Council President Bruce Harrell (District 2 – South Seattle), said, “In every policy or fiscal decision we make, we have to look at the impact on jobs. Our goal is to have a successful and vibrant business community–one of the best in the country–and at the same time, assist our most vulnerable and strategically invest in affordable housing. One does not exclude the other. Our investment strategy must balance these objectives without demonizing advocates or businesses. Today, we have reached a compromise that accomplishes this goal.”

Harrell continued:  “I did not support the spending plan, because our strategy must leverage the expertise and resources in real estate, software applications and other areas to make sure we gain the trust of the public in how we invest funds from this new revenue stream. This legislation is currently designed for a finite period to address the affordability and homelessness crisis. How we spend the money becomes critically important–residents, members of our business community and advocates should be afforded the opportunity to weigh in.”

Councilmember Sally Bagshaw (District 7 – Pioneer Square to Magnolia), a co-sponsor of the legislation and Chair of the Finance and Neighborhoods Committee said, “Since Seattle declared a state of emergency around the homelessness crisis, people have told us they want to see action, action that means people out of tents and in safer, healthier spaces, and cleanup of the public spaces in our neighborhoods. They also want more state and local funds for mental health and behavioral health improvements. This tax contributes toward the long-term solution of affordable housing, while giving immediate attention and resources to fund shelter services, so those living on the streets tonight can find a dry, warm and safe place to stay. I’m pleased my council colleagues also agreed to exempt hospitals and non-profits from this tax, recognizing the vital work they do in our community serving those on Medicare, Medicaid, and other vulnerable populations.”

Councilmeber Rob Johnson (District 4 – North Seattle), and a co-sponsor of the legislation said, “Any solution to help address our homelessness crisis must produce immediate results and protect the long term economic health of the city. Today’s action creates more affordable housing, addresses immediate needs of those living unsheltered and has a five-year sunset so we can effectively measure our efforts. I want to thank my council colleagues for this collaborative effort and for the engagement of non-profit organizations, faith and civic leaders, businesses, labor, affordable housing developers and community members.”

Councilmember Debora Juarez (District 5 – North Seattle), and a co-sponsor of the legislation said, “I want to see results from this tax, which means fewer people living on the streets and more people in shelters and permanent housing. Now it is time for regional partners and the federal government to join Seattle in taking bold actions to address homelessness.”    

Councilmember Teresa Mosqueda (Pos. 8 – Citywide), said, “Today, we took an initial step forward to reduce homelessness, build safer communities and toward a City that allows people who work in Seattle to afford to live in Seattle.  We have a homelessness and housing affordability crisis in Seattle, our shelters are at capacity and there is not enough affordable housing for folks to move into. Today’s progressive tax proposal and corresponding spending plan provides a significant down payment toward the housing our community needs. Our City is growing rapidly, and we must respond with urgency, compassion and leadership.  I look forward to continued collaboration with the community and my council colleagues to ensure we build more affordable, sustainable, and equitable housing for our city.”

With no state income tax, Washington is routinely ranked as having the most regressive tax structure in the nation.  Earlier this year, property taxes were dedicated by state lawmakers to fund education shortfalls; a B&O tax would require voter approval and spread the burden across all industries, including small business.  Other taxation options such as a tax on utilities would adversely affect rate payers, many who are on fixed incomes.

The legislation will take effect in January 2019.

 

Mayor, City Attorney & Council: We Call on Legislature to End Death Penalty in WA State

All nine Seattle City Councilmembers, Mayor Jenny A. Durkan and City Attorney Pete Holmes sent a LETTER to Seattle’s legislative delegation today, calling for an end to the death penalty in Washington State.  Washington Senate Bill 6052 and House Bill 1935 would eliminate the death penalty and instead require life imprisonment without possibility of release or parole as the sentence for aggravated first degree murder.  The House bill was heard in a public hearing in the House Judiciary Committee earlier today.

“As a former King County Prosecuting Attorney, I oppose the death penalty, period,” said Sally Bagshaw (District 7, Pioneer Square to Magnolia).  “The growing body of evidence confirms that the death penalty is no deterrent to serious crime, it is against the basic values of our constitution, it is unfairly applied and the costs of death penalty prosecutions are significantly more than other cases.  It is my sincere hope that 2018 is the year our state joins 19 others to abolish what is a bad option for any civilized society and that we invest our resources in solutions that work.”

“As someone who has been both a criminal defense lawyer and a federal prosecutor, I believe it’s time to end the death penalty,” said Mayor Jenny A. Durkan.  “It does not advance our best goals and does real harm to victims and communities. It is an ineffective way to deter crime in our communities. It diverts resources from valuable, effective public safety initiatives, delays justice for victims’ families, and perpetuates racial and social injustice. As a state, we must come together to focus on providing victims’ families the support they need to grieve and heal, while also administering effective and equal justice. I hope that our leaders in Olympia will do the right thing and finally end the death penalty in Washington State.”

“The death penalty is a vestige of a time gone by; the system is broken beyond repair,” said City Attorney Pete Holmes. “The criminal justice system cannot guarantee that every defendant, no matter his or her race, gender or age, will be treated fairly. The ultimate penalty does not bring solace to the families and friends of the victim nor does it guarantee equal treatment in the courtroom.”

City Council’s Statement on ICE Targeting Immigrant Rights Activist Maru Mora-Villalpando

New Americans Committee Chair M. Lorena Gonzalez and Vice Chair Teresa Mosqueda issued the following statement jointly with all nine members of the Seattle City Council in response to Immigration and Customs Enforcement’s initiation of deportation proceedings against immigrant rights activist, Maru Mora-Villalpando:

“We, members of the Seattle City Council, are angered that Seattle’s office of Immigration and Customs Enforcement (ICE) has served a ‘Notice to Appear’ to Washington-based community activist and mother, Maru Mora-Villalpando. This deportation notice appears to be a purely retaliatory action towards a known immigrant rights activist and community leader.

“Targeting of activists and those willing to speak up about injustices by ICE is received by immigrant communities as a clear intent to intimidate and silence immigrant leaders.  The detainment and threats of deportation of Baltazar Aburto Gutierrez, Ravi Ragbir, and Jean Montrevil, and now Mora-Villalpando, appear to be an act of political oppression meant to silence a growing movement highlighting injustices in detention centers as well as with our broken immigration system. We stand with Mora-Villalpando, and the immigrant community at large, and are deeply troubled by the recent direction of ICE in their enforcement actions that result in families being torn apart and communities across the country being upended and divided.

“Mora-Villalpando is a courageous advocate for social justice issues and immigrant rights in the Puget Sound region and nationally. Her leadership was crucial in building awareness of inhumane conditions, labor practices, and mistreatment of detainees at the Northwest Detention Center (NWDC). The immigrant detention facility is operated by the for-profit GEO Group, a corporation with a history of corruption and human rights violations in facilities across the country. Mora-Villalpando has also brought attention to the targeting of immigrants and refugees by ICE throughout our community and country, before becoming a target herself.

“Seattle is a Welcoming City, in a Welcoming State, and we condemn the targeting of activist and community leaders and cannot stay silent on this un-American activity by ICE. Mora-Villalpando is a trusted leader of our community. ICE’s action will likely spread more fear and anxiety across our immigrant communities; the outcome of this – intended or unintended – has a negative impact on public safety and the health and wellbeing of not just immigrant communities, but also their neighbors. Our city and our state is safer when immigrants feel trust in institutions and agencies tasked with keeping everyone, regardless of status, safe to live their daily lives. This act appears to be retaliation against Mora-Vilapando and a signal that can result in individuals afraid to speak up, either in acts of protest or when assistance is needed, and that is harmful for our community.

“The U.S. Constitution guarantees rights for everyone, regardless of status, and this includes the First Amendment which protects free speech, the right to peacefully assemble, and to petition the government for a redress of grievances. It is disappointing we must remind our federal government of this inalienable right. Targeting Mora-Villalpando shows a disregard for human rights, and exacerbates broken trust between immigrant communities and our federal government. We demand Seattle ICE immediately stop targeting activists and community leaders. We will not be intimidated, and we stand in solidarity with Mora-Villalpando and the thousands of immigrant and refugee activists, DREAMers, community leaders and others who bravely stand, undocumented and unafraid, for justice.”

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Council President Bruce A. Harrell                    Councilmember Debora Juarez

Councilmember Sally Bagshaw                          Councilmember Teresa Mosqueda

Councilmember M. Lorena González                 Councilmember Mike O’Brien

Councilmember Lisa Herbold                             Councilmember Kshama Sawant

Councilmember Rob Johnson

Council Sets 2018-19 Committee Assignments

The Seattle City Council today adopted Resolution 31789 establishing committee assignments for 2018 and 2019. Each Councilmember is responsible for chairing a Council committee and managing legislation related to the committee’s respective subjects. In addition, each Councilmember serves as vice chair, member and alternate on three additional committees.

Councilmembers elected Council President Harrell to continue serving as Council President. The Council President is the presiding officer of the Council, sets the Full Council agenda, assigns legislation to committees and is the primary point of contact for external agencies. When the Mayor is absent from the city or incapacitated, the Council President assumes the duties and responsibilities of the Mayor.

“I’m honored to work alongside some of the most dedicated and compassionate people I’ve ever known,” said Council President Bruce Harrell. “I’m thankful for my colleague’s confidence in electing me to my second term as Council President. Together, as a team, we will continue to work side by side to address the challenges facing Seattle, such as homelessness and affordability, and ensure Seattle is an equitable place for all.”

Councilmember Sally Bagshaw (District 7, Pioneer Square to Magnolia) will chair the Finance and Neighborhoods Committee. The committee will be responsible for reviewing the City’s financial management policies and will also focus on Seattle neighborhoods, building strong communities through outreach and engagement. Councilmember Bagshaw will also chair the Budget Committee, overseeing the review of the Mayor’s proposed budget.

Councilmember M. Lorena González (Position 9, Citywide) will chair the Gender Equity, Safe Communities, New Americans, and Education Committee. As chair, Councilmember González will consider policies to address gender inequality and help improve the lives of Seattle’s immigrant and refugee residents. The committee will also focus on public safety, including emergency preparedness and the provision of fire and emergency medical services, to foster safe and resilient communities.  Councilmember González’s committee will also continue its work to improve police accountability systems and ongoing police reform, reducing crime and violence and reforming the criminal justice system. New to Councilmember González’s committee are policies related to education. The committee will work on issues relating to education and early learning initiatives, Seattle Public Schools, improving student outcomes, and reducing the opportunity gap.

Council President Bruce Harrell (District 2, South Seattle) will chair the Governance, Equity, and Technology Committee. The committee will work on issues relating to technology, intergovernmental relations, regional legislative priorities, ethics and elections, and equity issues in the taxi, transportation network companies, and for-hire industry. As chair, Council President Harrell will also focus on issues relating to youth justice, alternatives to youth detention, and alternative options to youth incarceration.

Councilmember Lisa Herbold (District 1, West Seattle & South Park) will continue chairing the Civil Rights, Utilities, Economic Development, and Arts Committee. Councilmember Herbold’s committee will manage issues relating to civil rights and Seattle Public Utilities. As chair, Councilmember Herbold will also consider economic development policies, including small business development and support, workforce development, and improving access and opportunities to education and training for low- and middle-income workers, youth and communities of color. The committee will also manage issues relating to arts and culture in Seattle, which includes nightlife issues.

Councilmember Rob Johnson (District 4, Northeast Seattle) will continue chairing the Planning, Land Use and Zoning Committee. As chair of this committee, Councilmember Johnson will take up issues involving city zoning, community planning, design guidelines, major institutions, quasi-judicial decisions, community development, and land use regulations.

Councilmember Debora Juarez (District 5, North Seattle) will chair the Civic Development, Public Assets, and Native Communities Committee. As chair, Councilmember Juarez will focus on issues relating to City parks, community centers, the Office of the Waterfront, the Seattle Public Library system, and public grounds, including the Seattle Center. The committee will also bring attention to Native American issues, including housing affordability, health and mental health services, services for youth, access to justice, art and culture, and historic preservation.

Councilmember Teresa Mosqueda (Position 8, Citywide) will chair the new Housing, Health, Energy, and Workers’ Rights Committee. Councilmember Mosqueda’s committee will focus on housing policies and programs, investing in and promoting the development and preservation of affordable housing for workers, families, and retirees. The committee will also handle policies relating to Seattle’s energy usage, utility rates, and Seattle City Light finances. The committee will attend to matters of public health, including a Regional Health Plan and take the lead on issues relating to the Office of Labor Standards, especially workers’ rights.

Councilmember Mike O’Brien (District 6, Northwest Seattle) will continue chairing the Sustainability and Transportation Committee. Councilmember O’Brien’s committee will handle matters pertaining to city-wide and regional transportation policy and planning. These issues range from pedestrian and bicycle programs, traffic control and parking policies, and overseeing the City’s coordination with regional and state departments of transportation. The committee will also have a shared-focus on Seattle’s Climate Action Plan to reduce carbon emissions. In addition, Councilmember O’Brien will take up matters that relate to climate and environmental protections, conservation programs, and green infrastructure.

Councilmember Kshama Sawant (District 3, Central Seattle) will chair the new Human Services, Equitable Development, and Renter Rights Committee. Councilmember Sawant will oversee Council’s work on issues relating to services provided by the Human Services Department, including programs that meet the basic needs of the most vulnerable people in our community. The committee will also consider matters involving public health and Law Enforcement Assisted Diversion (LEAD), which allows law enforcement officers to redirect low-level offenders engaged in drug or prostitution activity to community-based services. The committee will also focus on renter rights, including but not limited to legislation intended to protect renters facing gentrification, economic evictions, excessive background checks, and unaffordable rent.

 

Standing Committee Committee Members Committee Meeting Days and Times*
Civic Development, Public Assets, and Native Communities Chair:  Debora Juarez

Vice-Chair:  Sally Bagshaw

Member:  Lorena González

Alternate:  Kshama Sawant

1st and 3rd Wednesdays

2 p.m.

Civil Rights, Utilities, Economic Development, and Arts Chair:  Lisa Herbold

Vice-Chair:  Kshama Sawant

Member:  Mike O’Brien

Alternate:  Rob Johnson

2nd and 4th Tuesdays

9:30 a.m.

Finance and Neighborhoods Chair:  Sally Bagshaw

Vice-Chair:  Lorena González

Member:  Bruce Harrell

Alternate:  Mike O’Brien

2nd and 4th Wednesdays

2 p.m.

 

 

Gender Equity, Safe Communities, New Americans, and Education Chair:  Lorena González

Vice-Chair:  Teresa Mosqueda

Member:  Rob Johnson

Alternate:  Debora Juarez

2nd and 4th Wednesdays

9:30 a.m.

Governance, Equity, and Technology Chair:  Bruce Harrell

Vice-Chair:  Lisa Herbold

Member:  Teresa Mosqueda

Alternate:  Sally Bagshaw

1st and 3rd Tuesdays

9:30 a.m.

Housing, Health, Energy, and Workers’ Rights Chair:  Teresa Mosqueda

Vice-Chair:  Debora Juarez

Member:  Sally Bagshaw

Alternate:  Lisa Herbold

1st and 3rd Thursdays

9:30 a.m.

Human Services, Equitable Development, and Renter Rights Chair:  Kshama Sawant

Vice-Chair:  Bruce Harrell

Member:  Debora Juarez

Alternate:  Teresa Mosqueda

2nd and 4th Tuesdays

2 p.m.

Planning, Land Use and Zoning Chair:  Rob Johnson

Vice-Chair:  Mike O’Brien

Member:  Lisa Herbold

Alternate:  Lorena González

1st and 3rd Wednesdays

9:30 a.m.

Sustainability and Transportation Chair:  Mike O’Brien

Vice-Chair:  Rob Johnson

Member:  Kshama Sawant

Alternate:  Bruce Harrell

1st and 3rd Tuesdays

2 p.m.

             

 

Council Approves Unprecedented Agreement to Redevelop KeyArena

SEATTLE – Council today authorized Mayor Jenny A. Durkan to execute a Memorandum of Understanding (MOU) with Oak View Group (OVG) to redevelop KeyArena into a world-class multi-purpose sports and entertainment arena. The legally binding agreement commits OVG to project costs, including all project overruns, $40 million in neighborhood transportation improvements, and a bevy of additional financial commitments and other obligations.

“We’ve set the stage to make the most significant investment in Seattle Center since the World’s Fair,” said Councilmember Debora Juarez (District 5, North Seattle), co-chair of the Council’s Select Committee on Civic Arenas. “Today’s agreement was the Seattle Process at its best: We gathered stakeholders, consulted the community, highlighted our concerns and goals, aggressively negotiated, and when we had a solid plan, we pushed it through.  I cannot overstate the diligence that went into this agreement.  We can all be proud of this transformational partnership.”

Council was party to a four-month negotiation between the City and OVG to develop agreement conditions. Council also retained a financial consultant to provide independent analysis to ensure the City would be party to a fiscally sound agreement. Council signaled its priorities early in the negotiation process, which generally fell into the following six categories:

  • The project must be fiscally prudent
  • The project must positively integrate with Seattle Center
  • Current Seattle Center tenant impacts must be addressed
  • Transportation impacts must be mitigated
  • OVG must treat workers equitably and consistent with the City’s Race and Social Justice Initiative principles during construction and operations
  • Needs of impacted neighborhoods must be addressed

The MOU agreement commits OVG to a 39-year lease with two, eight-year renewal options for a total of up to 55 years. The redeveloped arena will nearly double the size of KeyArena, meet LEED Gold or equivalent standards, and will preserve the current historic roofline. KeyArena was last renovated over 20 years ago, and a 2015 evaluation concluded that for the City to attract a sports franchise, the arena would need to be modernized.

Council President Bruce A. Harrell (District 2, Southeast Seattle), co-chair of the Select Committee on Civic Arenas, said, “The City negotiated one of the strongest arena agreements you will find in the country, protecting our taxpayers and the City. The community benefits agreement is unprecedented with investments to help address issues like homelessness and other social needs. I am confident this will be a partnership of success with OVG in building a state-of-the-art arena, generating economic vitality, and the ultimate goal of getting an NHL team and bringing back the Sonics.”

Councilmember Sally Bagshaw (District 7, Pioneer Square to Magnolia) said, “After a year of hard work and negotiations, we’ve taken the next step toward our civic Arena becoming the iconic destination for Seattle and the region. This redevelopment unlocks the potential for the best new arena for sports, entertainment, high-tech expos, concerts and more—with partners who have already demonstrated their commitment to partnering with the City for success. Thank you to the members of the Oak View Group, to Brian Surratt and City negotiators, and to the community leaders who have come to the table to address mobility and economic development challenges.  We’re underway!”

OVG will not use City bonding capacity for development of the project, nor will they be exempt from paying admissions taxes to the City. OVG intends to fund the project through a combination of private equity, debt financing from lenders, and federal historic tax credits. OVG will assume all costs related to operating and maintaining the arena.

OVG is expected to contribute the following to the KeyArena redevelopment project:

  • $600 million in project costs, plus all cost overruns.
  • $3.5 million to cover the City’s cost for the hiring of expert consultants and legal counsel during the MOU negotiation process.
  • $250,000 for a transportation consultant to develop a neighborhood mobility action plan.
  • $40 million payment for transportation improvements over the 39-year lease term (approximately $1 million per year), as informed by the mobility action plan.
  • Guaranteed baseline rent and tax guaranty payments, amount to be determined by an accounting firm based on the four-year trailing historical annual average of arena-related revenues for years 2014 through 2017 (roughly estimated to be approximately $2.6 million per year.
  • $20 million in-kind or cash to non-profit organizations, including $10 million dedicated for YouthCare. Council amended the MOU to require that at least half the contributions be made in cash.
  • $1.5 million to relocate the Seattle Center campus’ skate park and maintenance facility.
  • $500,000 for relocation of other affected Seattle Center tenants.
  • All costs related to temporary and permanent relocation of Pottery Northwest
  • Hire and pay for a community liaison.
  • 14 rent-free days per year for the Seattle/King County Public Health Clinic, Bumbershoot, and other community events.
  • Dedicate one percent construction costs to the 1% for the Arts Program.
  • Make a Mandatory Housing Affordability payment for the increase in arena square footage.
  • Arena workers are expected to be paid a prevailing wage, and current qualified KeyArena employees will be offered an equivalent job following the arena’s opening.
  • As revenue collections begin, the City will collect 25 percent of excess revenue in the first ten years of the lease, and 50 percent for the remaining years beyond the baseline rent and tax generated.
  • If arena tax revenues ever fall below current levels (about $2.4m/year), OVG will reimburse the City the difference.

The MOU provides an agreed-upon framework that will soon be memorialized in a Development Agreement, Lease Agreement, and Seattle Center Integration Agreement. Redevelopment construction is estimated to begin at the end of 2018 for opening in October 2020.

Contact
Mercedes Elizalde, Councilmember Juarez’ Office, 206-684-8805
Dana Robinson Slote, Council Communications, 206-615-0061

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