Seattle’s punitive, job-killing head tax is a terrible idea in any form. Mayor Jenny Durkan should reject this misguided measure that will reduce opportunity and support for important homeless response programs.
With its stubborn pursuit of a job-killing head-tax, the Seattle City Council’s tactics are proving to be as divisive and destructive as President Donald Trump’s.
Even Trump could learn from the council’s ability to simultaneously pander to its extreme base, ignore sage advice and divert attention from its terrible performance.
Mayor Jenny Durkan must veto any version of the tax to ensure Seattle continues attracting jobs that nourish the economy and create opportunity for all.
Like Trump’s travel ban, Seattle’s head tax cannot be reworked to make it palatable. It’s a potent symbol of who is welcome and who is not.
The head tax represents City Hall’s increasing unpredictability and disdain for employers. Regardless of Amazon’s response, the city’s attitude dissuades companies of all sizes from creating jobs here. It threatens the cycle of prosperity that saw Boeing plant seeds for Microsoft, which seeded the current generation of tech employers.
City Hall is jeopardizing that to score points with patrons and increase its budget by 1 percent. Let’s talk it through.
We must help the homeless, right? Yes, so $200 million is being spent in Seattle and King County. Last year’s one-night count estimated the county homeless population at around 12,000.
The crisis needs more: Consultants in 2016 said the major problem is mismanagement, not funding. Seattle then improved service-provider contracts, requiring them to show progress moving people to permanent housing.
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Seattle reported a homeless population of 8,476 people, including 3,857 who were unsheltered, in 2017. In November it said the new contracts would move 7,000 into permanent housing and provide 1,464 shelter beds this year.
Yet the council insists funding must double to avoid catastrophe. City officials say more is needed because more people will become homeless.
One-night counts found 6 to 8.5 percent increases in recent years. If there’s a 10 percent increase this year, and Seattle contracts perform, the city should end 2018 with a huge reduction in homelessness and reduced funding needs.
If Seattle doesn’t progress, and keeps doubling spending on 1 percent of its population, it will go broke.
More affordable housing is needed: Yes, but at what cost? Since 2015, Washington’s Housing Finance Commission provided $838 million worth of bonds, tax credits and funding for Seattle affordable housing, according to state Rep. Gael Tarleton, D-Ballard. Current projects are increasing housing stock by more than 10 percent.
Big companies are to blame: Higher compensation does contribute to higher home prices, which exacerbate the challenge of homelessness. But there’s scant evidence good-paying employers cause homelessness. In county surveys, job loss was cited more frequently than affordability as the cause of people’s homelessness, so why suppress job creation with a tax?
Amazon should pay: It’s a major taxpayer, paying $250 million last year in state and local taxes.
Jeff Bezos can afford to pay more: Sure, but he doesn’t have to, after giving Seattle’s economy more than $85 billion worth of economic growth since 2010 by choosing to expand Amazon in the city.
Only Amazonians benefit: Tech growth created tens of thousands of non-tech jobs and enabled government to increase spending.
Seattle spending on homeless programs more than doubled since 2010. State spending on social services grew 55 percent, to nearly $40 billion per biennium, since 2009.
A Maryland study estimates a 50,000-person Amazon headquarters generates $17 billion a year in economic activity. Washington Chief Economist Steve Lerch can’t disclose effects of Amazon’s nearly 50,000-person Seattle headquarters but said Maryland’s estimate is reasonable.
What should we do? Homelessness and affordability are worsening despite record spending on services and housing, so the public needs to see performance improvement before spending more. More emphasis is needed on reducing poverty. Instead of penalizing job creators, encourage them to create opportunities.
Homelessness demands a regional response, with other cities supporting and absorbing more of the population needing homes. That’s overdue since Seattle’s own survey found 51 percent of its homeless came from elsewhere, mostly around the region and state.