Mayor Jenny Durkan proposes to fund healthy-food and education programs that, until now, have been paid for through the city's general fund, an idea that one unhappy council member described as a bait-and-switch tactic.
Seattle’s tax on sugar-sweetened beverages is bringing in more money than anticipated, leading to debate at City Hall about how the extra money should be spent.
When the city passed the tax on distributors last year, it was expected to raise about $15 million in 2018 and the plan was to spend most of the money on healthy food and education programs.
But the tax drummed up more than $10 million in its first six months, starting Jan. 1, so the city now expects to collect $21 million per year. Mayor Jenny Durkan wants to leverage some of the extra money for other purposes.
Looming over the revenue discussion are questions about the impact of the tax, which proponents said would discourage soda consumption. A state initiative on the Nov. 6 ballot, backed by the soda industry, would prevent other cities from adopting beverage taxes.
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The larger-than-expected proceeds could mean the tax is failing to stop people from buying soda. Or it could be that the city’s estimate was bad. University of Washington researchers have yet to report on consumption trends.
For now, the mayor’s move could bolster claims that beverage taxes are less about public health than about grabbing dollars.
Durkan’s proposed 2019 budget would use $5.7 million from the so-called soda tax for healthy food and education programs that, until now, have been paid for through the city’s general fund. That would free up $5.7 million in general-fund money to help balance her overall budget, which boosts spending on transportation, police and homeless services, among other needs.
Some City Council members reviewing Durkan’s $5.9 billion budget are objecting to the swap. They agreed to pass the beverage tax of 1.75 cents per ounce despite knowing it would hit poor people hardest, partly because they thought all the money would be used to help those same people eat more healthy foods and access education.
At a budget committee meeting Monday, Councilmember Debora Juarez expressed anger over what she described as a bait-and-switch by the mayor.
Juarez pushed last year for food banks in her North Seattle district to receive some of the soda-tax money. With the tax raising more money than expected, food banks should see more support, she said.
“I’m really disappointed,” Juarez said.
Councilmember Mike O’Brien also spoke out against the swap, arguing that the extra money should be used to help people more likely to buy sugary beverages and more likely to be hurt by such products.
“(The revenue) should be going back into those communities,” he said.
Some council members said they want more information before deciding what to do, and O’Brien said he understands the mayor had reasons for building her budget the way she did. Notwithstanding the swap, her budget does increase support for certain food and education programs.
“She was trying to balance a complex budget,” O’Brien said. “I’m assuming she didn’t take this lightly.”
The council intends to pass the mayor’s budget, with some changes, next month.
The mayor’s plan “reflects her commitment to focusing on essential services, addressing our affordability crisis, creating a more inclusive Seattle and investing in a city of the future,” Durkan spokesman Mark Prentice said in an email.
“That’s why her proposed budget invests in sustainability, food security and expanding access to transit … Mayor Durkan evaluated all available revenue streams and efficiencies to ensure the city of Seattle is living within its means.”
Undoing Durkan’s move would leave the council with a problem – a $5.7 million hole to plug in the rest of her 2019 budget. Rather than try to do that, O’Brien has a proposal to protect the beverage-tax proceeds from such swaps starting in 2020, he said.
UW researchers were at one point set to present Monday on how much the tax is being passed along by distributors through stores to customers via higher prices. The council recently postponed the presentation in order to concentrate on immediate budget issues and because the report is not yet finalized, said epidemiology professor Jesse Jones-Smith.
The researchers also are studying beverage sales and consumption among low-income children, with results due later on.