Seattle Mayor Ed Murray proposed the $275 million property-tax levy to raise money for programs to fight homelessness just a month ago, but now he’s scrapping that idea for another: a sales-tax increase.
Barely a month after announcing it, Seattle Mayor Ed Murray and entrepreneur Nick Hanauer are scrapping their plan for a $275 million property-tax levy to fight homelessness.
The mayor wants to replace it with a different tax proposal further down the road.
Rather than ask city voters to approve the levy in August, Murray now intends to work with King County Executive Dow Constantine on a 2018 homelessness measure that would use a 0.1 percent county sales-tax increase, he said Monday.
The average county household would pay $30 per year.
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“We’re moving away from the property tax,” Murray said in a meeting with The Seattle Times editorial board.
The move represents an abrupt change in direction for Murray, who touted the levy in his State of the City address in late February, saying it would nearly double Seattle’s spending on homelessness in an effort to move people from the streets into housing.
Supporters of the five-year levy began collecting signatures only two weeks ago, planning to qualify the measure for the August ballot as a citizen initiative.
Murray is pivoting not because he believes city voters would reject the levy but for other reasons, he insisted Monday.
The Metropolitan King County Council is considering that measure, which would appear on the August ballot and would raise a projected $469 million over seven years.
Murray said Constantine’s arts measure took him by surprise and helped spark a conversation that led to the new plan for homelessness.
That conversation may have touched on legislation introduced by County Council members Rod Dembowski and Larry Gossett.
On March 23, they pitched a 0.1 percent sales-tax hike for homelessness on the August ballot, arguing leaders should prioritize unsheltered people before arts, science and culture.
Rather than fight the idea, Murray and Constantine adopted it — for 2018, Dembowski said. He and Gossett may continue to push for an earlier vote.
To further complicate matters, voters will be asked in November to renew — and likely to boost — the county’s expiring veterans and human services property-tax levy.
On Monday, mayor said a 0.1 percent county sales-tax increase would raise more money for homelessness than a Seattle-only levy would have — a projected $68 million in its first year versus $55 million per year.
And postponing a vote until next year would give the city and county more time to make headway on reforming their homeless-services systems, Murray said.
Later this year, the city intends to bid out its contracts through a competitive process for the first time in more than a decade, using new performance metrics.
Some critics of the levy proposal asked why voters should greenlight additional money before more progress has been made on that front.
Thousands of people are living without shelter in the Seattle area, many of them in tents and under bridges. To serve them, the city and county pay dozens of organizations through a complex web of contracts.
Last year, consultants said Seattle and King County could make significant headway by reallocating resources.
“Homelessness is a regional and national issue, which is why we’ve always worked closely with King County to help people get access to services and housing,” Murray said at a news conference.
Constantine added, “We will develop a comprehensive proposal, with the right people around the table — including our dedicated housing and homelessness service providers and the community.”
The new plan replaces one regressive tax proposal with another. Before it was junked, the homelessness levy provoked pushback from people worried about its hitting lower-income people hardest.
State law has stopped local officials from seeking more progressive tax measures, Murray and Constantine said. The Seattle Transit Riders Union and other organizations are pushing for a city income tax that would challenge that impediment.
Another potential stumbling block: While a sales-tax hike could result in more money being raised for homelessness, skeptics may ask whether a delay is appropriate.
Murray and Constantine proclaimed the city and county to be in homelessness states of emergency in November 2015.
There was some confusion following the mayor’s February speech about who exactly was the driving force behind the homelessness levy.
Murray initially cast the plan as his own and said he had asked Hanauer to help head up an advisory group tasked with drawing up the details.
But Hanauer, a superwealthy venture capitalist and Democratic political donor, then told The Seattle Times that he had brought the idea to Murray and had been working on it for many months.
“We just decided we were going to do something, and no one can stop that. And once that bus leaves the station, people can get on or get run over,” he said at the time.
Rather than send a proposed ballot measure to the City Council himself, Murray clarified that the levy would move ahead as a citizen initiative, with Hanauer leading and bankrolling the campaign.
The plan called for $185 million to be spent on providing more people with access to permanent supportive housing and on increasing subsidies for renters.
An additional $55 million was to be spent on hiring more outreach workers and on converting overnight shelters to 24-hour facilities.
And $25 million was to be spent on expanding treatment for people dealing with substance abuse and mental illness.
Backers quickly collected about 30,000 signatures and the effort was “humming along,” according to campaign co-chair Daniel Malone, director of the Downtown Emergency Service Center.
But Malone is at peace with Murray pulling his support and with the push ending prematurely, he said in an interview Monday.
“It was a shared decision to end the campaign,” Malone said. “The campaign itself could have continued if we wanted, but this new approach is one that includes our partners at the county. Having a truly regional approach is certainly a good thing.”