Seattle City Council members introduced 10 amendments Tuesday to revise Mayor Ed Murray’s historically large $930 million Move Seattle property tax levy to fund transportation. Some could make big differences in how the projects are financed or even what gets done.
The debate so far has not been whether the city needs the funding, but about who should pay for it, how big the levy should be and how to ensure it will pass next November.
Here are three of Tuesday's most discussed and potentially significant changes (the full list is here):
1) Worried about giving the Seattle Department of Transportation a blank check, Councilmember Nick Licata wants to forbid spending the levy money on a streetcar. SDOT Director Scott Kubly and Licata had a tense back and forth about this issue.
2) Councilmember Tom Rasmussen wants to reorganize the levy's priorities to make them more specific.
3) Licata wants to reduce the property tax to $600 million and fund the rest of the work with commercial parking and employee taxes and fees on developers.
Seattle voters have a seemingly bottomless stomach for property taxes, passing nine out of 10 levies since 2006. Murray and the Seattle Department of Transportation feel good about Move Seattle’s chances, but voters have never been faced a city levy with such a large number before. Licata, especially, is concerned that if the levy doesn’t pass, a second attempt would have to compete with next year’s housing levy.
A streetcar not desired
The shortest amendment made the biggest splash. It reads, “None of the levy proceeds may be used to build or operate streetcars.”
Licata said he introduced the amendment to avoid mission creep and vagueness in the levy. He appeared to think the amendment was more of a formality than anything. “Quite honestly,” he said, “…there’s no mention of building or operating streetcar, so this simply memorializes what is the intent of the mayor.”
But SDOT’s Kubly quickly began extolling the value of a streetcar connecting with a Sound Transit station being built on Broadway and what an extension of a new streetcar line could accomplish. A streetcar extension from Capitol Hill to South Lake Union, he said, could be used to improve access to the forthcoming light rail, which will run to north Seattle and beyond. As light rail access is an important part of Move Seattle, a streetcar extension could theoretically be funded under the levy. Kubly resisted Licata’s amendment, saying SDOT should be allowed to preserve this flexibility.
“Wow,” said Licata. “I heard a great description of what the plans were, but no reference for where the money would come from.” The streetcar, which Kubly said would cost $112 million, could receive up to $75 million in federal funding. But the city would need to provide matching funds. Kubly said the city currently has no plans to use levy money to match federal funding, but that he couldn’t anticipate priorities in nine years.
Nevertheless, Kubly said SDOT would apply for the federal money in September, implying they might need the match sometime in the next year. Kubly said that match would come from advertising revenue, not the Move Seattle levy.
Licata took Kubly’s resistance as a sign that SDOT would “probably” use Move Seattle to fund a streetcar extension. Kubly called that a “mischaracterization,” holding steady that this was only about flexibility.
Councilmember Tom Rasmussen is proposing the city council rename parts of the levy. The original draft places all the projects under four umbrellas: a safe city, an affordable city, an interconnected city, and a vibrant city.
Rasmussen said when he went out into the community, he heard confusion: People weren’t sure what each category encompassed. Rasmussen, therefore, wants to whittle the four categories down to three: safe routes, maintenance and repair, and congestion relief.
The meat of the levy would be untouched under Rasmussen’s changes. But reorganizing how its framed is interesting because SDOT and the mayor’s office have done all of the outreach under the four umbrellas. In an SDOT survey (which some feel is not adequate), responders were asked to rank from one to four how important each category was to them. Further, specific projects were grouped under the original umbrellas before responders were asked to prioritize.
Based in part on the results of this survey, SDOT and the mayor revised the levy up $30 million and shifted some funding. Although Rasmussen’s new categories may mean nothing, it stands to reason that if congestion relief had been an umbrella, the public might have responded differently.
Councilmember Licata wants to reduce the proposed property tax levy to $600 million. The remaining $330 million would come from council legislation to increase taxes on commercial parking and add an $18 yearly tax on businesses for every full-time employee. Licata has said by reducing the burden on property owners, the levy would be more equitable and more likely to pass.
The city had a similar employee tax in 2009. The council repealed it for two reasons:The country was in the middle of a recession and the city wanted to encourage, not discourage, hiring. And the paper work involved with businesses complying with the tax was daunting.
The city is now in a boom. The U.S. Bureau of Labor Statistics estimates Seattle’s unemployment at 3.7 percent, down from 7 percent in 2009. Additionally, the previous employee tax only applied to those who commuted by car. Distinguishing between how employees commuted was a paperwork nightmare for businesses. This tax, however, would apply across the board.
Still, support is tenuous. The Seattle Metropolitan Chamber of Commerce recently distributed an e-mail to its members asking them to contact the council and discourage support for Licata’s amendment. The organization’s argument hasn’t touched on the financial burden of the tax on businesses as one might expect. President and CEO Maud Daudon said in an e-mail to Crosscut that property tax is the “consensus funding source,” crediting SDOT’s outreach work. “Let’s respect that work,” she said, “and move the proposal forward with this important investment in our city’s infrastructure.” In other words, if it ain't broke, don't fix it.
Councilmembers Sally Bagshaw and Tim Burgess appear to oppose Licata's changes. Their main reason, one they share with the mayor, is that they’d like to reserve both the employee tax and the commercial parking tax for future use on projects not covered by Move Seattle. A new Magnolia bridge is one example.
Burgess went a bit further Tuesday, saying he could support the amendment if it was tied directly to transportation. "If you were a business in a high congestion area," he said, "you would pay a higher tax or fee compared to someone who has created jobs in a low congestion area." When asked if this would just create the bureaucracy the city wanted to avoid, he said it might but that could be avoided with a congestion map.
Support or opposition for each amendment seems to loop back to one primary thing: What will get the levy passed? Licata is not confident, so wants to make major changes to help it along. The time to use these tax mechanisms, he said, is now.
But Bagshaw, Burgess, the Chamber and Kubly seem to be betting on its approval as is and are therefore less willing to make changes. That said, Council President Burgess ended by saying he expects most of the amendments to pass when the council votes June 23.