“I’m going to donate enough money to that campaign to make sure that we would win,” said Nick Hanauer, tapped by Seattle Mayor Ed Murray to help draw up a $275 million homelessness levy.
In his State of the City address, Seattle Mayor Ed Murray announced last week he would ask voters to approve a $275 million property-tax levy to combat homelessness.
Murray cast the plan as his own, saying the city must double its homeless spending. Superwealthy entrepreneur Nick Hanauer, Murray explained, would help draw up the details.
Why Hanauer? The venture capitalist says his Seattle-based think tank brought the idea to Murray and has been working on it for the last year.
“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,” Hanauer said in an interview.
In recent years, Hanauer has backed winning campaigns to increase the state’s minimum wage and expand background-check requirements for gun buyers.
Now he has set his sights on helping the thousands of people who are struggling to survive on the streets of Seattle.
“We came to the mayor and said, ‘We are throwing down on homelessness,’ ” he said. “We said, ‘We are going to take something big to the ballot.’ ”
The mayor was receptive, said Hanauer, who called the project a collaboration between his organization and City Hall.
“Mayor Murray is a friend of mine, and it’s all connected,” Hanauer said. “This is not a secret plot. It’s a group of citizen activists and leaders thinking about what to do.”
The plan is to qualify the levy for the August ballot as a citizens’ initiative rather than as a city proposition by the mayor and council. The campaign would need to collect at least 20,638 valid voter signatures to do that. The measure would raise $275 million in property taxes over five years.
Hanauer says he’ll bankroll the levy campaign.
“The thing that makes our contribution great is I can throw down and say I’m going to run an initiative. I can go all out,” he said.
“I’m going to donate enough money to that campaign to make sure that we would win. It’s so far below the amount of money that I care about that,” Hanauer added. “It’s not a statewide campaign, so it’s not going to cost $10 million.”
“Extra political force”
It’s been 14 months since Murray declared a homelessness state of emergency, hoping his federal and state counterparts would respond with an infusion of assistance.
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Last January’s annual overnight count tallied nearly 3,000 people without shelter in Seattle. A higher number is expected this year.
The city has increased its annual homelessness budget by close to $20 million in recent years, opening authorized tent encampments and additional shelter beds.
In renewing an expiring affordable-housing levy last year, Seattle voters agreed to double the size of the package from $145 million to $290 million over seven years.
But major outside aid hasn’t come and isn’t likely to now that Donald Trump is president, the mayor says. That’s why a homelessness levy is needed, he says.
“Seattle can’t wait,” Murray said in an interview. “It wouldn’t be my first choice and it wouldn’t be my second choice, but honestly, we don’t have any other choice.”
The mayor and City Council budgeted about $60 million to spend on homeless services this year, and the proposed levy would raise an additional $55 million per year. Murray knows he wants the additional money but doesn’t know exactly what it would be used for.
He said in his speech that an advisory group led by Hanauer and Downtown Emergency Service Center boss Daniel Malone, along with Councilmembers Sally Bagshaw and Debora Juarez, would send him a detailed proposal within two weeks.
Questions about homeless spending have for years dogged the city, which pays dozens of service organizations through a complex web of renewable contracts.
The city hasn’t bid out its homeless contracts in more than a decade. Murray has vowed to streamline the system and begin awarding work based on performance.
Past attempts to reform the system have encountered opposition from some service organizations and council members, for various practical and political reasons.
Malone says the money from the levy could expand existing services, with an emphasis on moving more people into permanent housing rather than shelter.
Murray said an independent panel could watchdog the organizations receiving the money, and Hanauer cast the initiative as a chance to move beyond business as usual.
“Homelessness has reached a crisis point. It’s quite clear what to do to fix it, but creating the discipline and political will to get that done is very difficult,” he said.
“You have do-gooders competing against other do-gooders. Everybody has their favorite homelessness program,” Hanauer added. “We reasoned that an extra political force would be super useful,” as would operating outside of the council’s normal political process.
No. 1 problem
In his speech, Murray challenged Seattle’s business community to raise $25 million to supplement the levy with “disruptive innovations” to move people into housing.
Hanauer won’t be part of that, he says. The early Amazon investor, who lives in a private neighborhood just north of Seattle, instead views his role as backing the levy.
Hanauer contributed $1 million to last year’s winning campaign for a statewide minimum-wage increase and $1.4 million toward the 2014 gun-safety measure. He served on the advisory group that worked on Murray’s $15-an-hour minimum-wage plan, helped found the League of Education Voters and has donated to charter-school measures.
It’s ironic, says Tim Harris, of the Real Change Homeless Empowerment Project, to see a rich progressive pushing a tax increase that would hit lower-income people hardest.
But in a state where income taxes are prohibited, property taxes may be the “best and most immediate way of providing real relief” to people without homes, Harris says.
Hanauer has staffers at his think tank, Civic Ventures, working on homelessness and the levy. They think $55 million a year might not be enough to get everyone off the street.
“If we really wanted to solve this problem, we would raise $550 million (per year),” he said.
Civic Ventures is confident the measure will pass, based on the results of three private polls, Hanauer says. He declined to share the results.
“People understand that homelessness is the No. 1 problem facing the city, and the support for this is overwhelming,” Hanauer said.
Hanauer is involved because, Murray says, “He’s somebody who cares deeply about doing something.” Why else? “This campaign needs to be funded,” the mayor said.