Select Budget Committee Session II 9/30/25

Good afternoon.

Welcome back, colleagues.

The September 30th, Robert's birthday Select Budget Committee will come back to order at 2.30 p.m.

Will the clerk please call the roll?

Council Member Rivera.

Council Member Sacca.

Here.

Council Member Sullivan.

Here.

Council Member Hollingsworth.

Council Member Juarez.

Here.

Council Member Kettle.

Here.

Council President Nelson.

Council Member Rink.

Present.

And Chair Strauss.

Present.

Six present.

And all the council members who are not present are excused until they arrive.

Thank you all for your flexibility as we ran a little bit over this morning.

Colleagues, we have two departments, two and a half hours until 5 p.m.

We are in control of our own destiny.

We can be out of here at four, we can be out of here at six.

It is our own choice.

Moving right into this work, Clerk, will you please read the fourth item into the record?

Office of Arts and Culture for briefing and discussion.

Thank you.

We are joined by Director Kayyem, Kelly Davidson, and of course, always Director Eater and Director Noble.

I'm going to just turn it over to you all.

If you want to run through your presentation, we're going to hold questions and then we'll dive in.

Can everyone hear me fine?

Great.

Thank you for the introduction.

I'd say bring that microphone.

Mick Jagger, as we say.

How's that?

Councilmember Hollingsworth is now present.

Perfect.

Well, thank you all for being here for this presentation on the Office of Arts and Culture's 2026 proposed budget.

In this presentation we will provide a high-level overview of the department's spending priorities and how our investments will work to secure a strong, sustainable arts and cultural policy landscape for Seattle's future.

Following this presentation, we are happy to answer any questions you may have.

So, just a reminder here that at the Office of Arts and Culture, our mission is simple but powerful, to activate and sustain Seattle through arts and culture.

We envision a city driven by creativity where everyone has the opportunity to engage in diverse and meaningful cultural experiences.

We work to make that vision real through grants, programs, partnerships, and cultural planning that will help make Seattle a vibrant and inclusive city.

So this slide highlights that while overall budget increases may appear small, it reflects strategic investments that align with the mayor's priorities, major events and community needs.

In 2025, we've already committed 2.5 million to roughly 60 projects supporting downtown activations and World Cup preparations.

These projects will be implemented next year and they include block parties, cultural dance and music performances, public art installations, neighbourhood walking tours and much, much more.

Next year you'll see these events throughout King Street Station, Union Station, the CID, Pioneer Square and other downtown locations.

We're also supporting more than a dozen community-led World Cup celebrations across Seattle neighborhoods in every council district, helping our communities define how they take part in this global moment.

Looking ahead into 2026, the executives' proposed budget includes continued investments in Hope Corps, graffiti interventions, and a city-wide cultural planning process.

So Hope Corps, this program was initially launched as a pandemic recovery effort to support creative workers and strengthen community wellbeing through art space interventions.

It has since evolved over time to put artists to work on civic priorities.

In 2026, the mayor proposes to make the Hope Corps program permanent with permanent ongoing funding for at 350,000 per year.

This funding will support a one-year extension of temporary labor and programming, helping us maintain momentum for this program, which up until now has operated on one-time funding.

While $350,000 is less than prior years, we're committed to making it work.

This will require us to redesign the program in ways that increase impact despite the reduced funding, Some of the options we're exploring include concentrating efforts in high traffic areas, redefining programming scope to align with budget constraints, and partnering more strategically to extend our reach.

Another major addition is $200,000 in one-time funding to launch citywide cultural planning.

Why now, you may ask?

In 2025, our office completed a strategic plan which was internally focused on our organization and it acknowledged the long-term programmatic and staffing impacts of the pandemic, responded to leadership transitions and reorganized and strengthened internal systems.

This work laid the foundation for a broader cultural planning effort which is externally focused and it's much needed as in 2025, Seattle's arts and cultural landscape continues to evolve and face uncertainty.

For example, federal cuts to arts funding, continued slow ticket sales impacted significantly by drops in tourism and of course the doors open levy which was implemented this year.

However, it does provide significant resources but we do not have data yet to know what the impacts will be.

With all this in mind, our cultural planning process will engage arts and cultural stakeholders across Seattle, conduct asset mapping, consider sector needs and strategic opportunities, and ultimately set out a 10-year vision for arts and culture in Seattle.

This plan will act as both a policy and investment guide, aligning our cultural resources with broader civic goals and economic development strategies.

As we move forward, we look forward to partnering with each of you to make sure your districts, your constituents and priorities are part of shaping this planning process.

Moving on to graffiti prevention, the city's 2026 proposed budget includes a 1.6 million and six FTE to support the One Seattle Graffiti Plan.

This is a city-wide initiative focused on graffiti removal enforcement, community support and beautification.

This investment supports staffing and resources for graffiti abatement and prevention across multiple departments including Seattle Parks and Recreation, Seattle Department of Transportation, and of course the Office of Arts and Culture.

Within our office, the proposed budget allocates $160,000 for a one-time extension of a temporary graffiti specialist position.

This position is central to the city's graffiti prevention work and it focuses on developing creative strategies to deter graffiti, connecting with Seattle's graffiti community, and mentoring and engaging youth to channel their creativity in positive, constructive ways.

This role also leads and enhances beautification efforts that embrace the artistic value of graffiti while helping reduce vandalism in public spaces.

This collaboration with the mayor's office has been unique and effective.

The artist in this position operates within our offices at King Street Station and is able to collaborate with our public art division and access resources and support from art staff while working on downtown graffiti strategies with the mayor's office.

This work directly supports the goals of the One Seattle initiative by improving livability, strengthening community ties, and promoting creative expression as part of public safety.

So in closing, I want to thank you and to emphasize that while this proposed budget may not contain sweeping increases, it's strategic and forward-looking.

We're investing in what matters, continuing workforce support through Hope Corps and supporting World Cup celebrations, as well as developing a cultural roadmap for Seattle's future.

So thank you once again, and we're very happy to answer any questions you may have.

Thank you, Director Khaim.

And Councilmember Rink is chair of the committee overseeing the department.

You are recognized.

Thank you, Chair.

Colleagues, as we all know, Seattle's cultural sector is largely responsible for putting our city on the map and has kept our city on the forefront of cultural innovation and exchange for decades, nationally and even globally.

From the 62 World's Fair to starting the nation's first, and in my opinion, still best, Percent for Art program to fostering generations of global talent in music, letters, film, dance, and visual art, our city government has long been a catalyst for and a strong partner to the cultural sector.

and that partnership goes far beyond our financial contributions to organizations and culture workers.

Those investments have resulted in massive returns to the city in terms of economic development and Seattle's place in global consciousness and Seattle's sense of belonging, identity, and pride in place.

The Office of Arts and Culture has driven these investments for decades, coordinating the efforts of several city departments and filling a critical role of connecting local government with the thousands of culture workers, organizations, patrons, and creative young folks that give this city its flavor.

In recent years, the cultural sector of Seattle has been hit by the massive challenges affecting all sectors, namely the COVID pandemic and Seattle's ongoing affordability crisis.

The Office of Arts and Culture has seen a number of challenges in recent years as well, with significant staff turnover and churn and program focus and delivery driven by decisions from past leadership.

Into this unprecedented era, Director Kayyem was hired to turn things around and get arts back on track.

And this has been a monumental lift, and while there's still a ways to go to get to where we fully need to be to meet this moment, I want to thank the director for her efforts to date and for the thoughtful approach to building back better via direct engagement with all corners of our cultural community and to truly listening to the needs of all stakeholders.

Seattle's cultural ecosystem is as critical and in many ways just as imperiled as our natural ecosystem, and every dollar we invest now in restoring and advancing the sector will come back to us in ways big and small.

So as we look at this budget, I wanna flag that I appreciate the thought and care Arts is putting into that work, and I wanna stress the urgent need for bold leadership and clear results from all city departments that our culture workers and organizations rely on.

They demand and deserve no less.

And with that, I'll move into some of the questions I have about our proposed budget that we're looking at today.

Moving into the CARE grant program.

We've heard from a number of organizations about the rocky rollout of Centering Art and Racial Equity grant program that replaced the Civic Partners program.

for arts organization operational support.

We know that the transition predated your tenure, but as you look to the next iterations, what is your vision for the program, and how large of a pool of funds are you anticipating will go to how many organizations?

So thank you council member for that question.

We're actually reviewing that program at the moment.

We have just launched a survey, sending it to all of our grantees within that program, asking them about how well it's working for them.

Obviously the program began prior to the pandemic, then the pandemic hit and conditions are very different now.

So we are reconsidering it and also of course there's, as I mentioned, doors open, which provides significant resources for arts and cultural organization and in some ways also overlaps with our investments.

We believe that general operating support should continue from the city, but the question is how?

And so when you speak about my vision, I'm looking towards the community to help shape that vision.

So once we have the survey results back, we'll be able to be more clearer about what direction we're going.

We really want to listen to what they have to say first, what their experience is with the program before we make any changes.

Thank you for that, and I'm interested to see the survey results of that as well.

And moving into arts operates the Langston Hughes Performing Arts Institute facility in partnership with both parks and community-based organizations.

Have you identified needed capital improvements that are not currently addressed in the proposed 2026 capital improvement program?

Yes, well thank you for that question as well.

I'm going to invite Deputy Director Davidson to also chime in on this because she's been closely tracking the work that we've been doing at the facilities.

As you know, it's a collaboration with the Parks Department, ourselves, and the non-profit Langston.

So Kelly, would you provide the details?

Sure.

So we've been working with the Parks Department right now.

We're working with their project management staff, and they are currently creating an RFQ for a design consultant.

Parks has, I believe, just over $2 million coming to this, and then the Langston organization received a King County grant for $500,000.

And we've been collectively prioritizing which projects of the capital projects are needed to move forward in in that work.

We can definitely get a list of those to you because we do have a list of some of the pieces that are not going to make that that continued fundraising efforts are underway for and we are continuing to work with Langston in any efforts to seek additional dollars or resources for those other pieces that are needed.

I just want to also add that I've been very aware of the deferred maintenance to the facility and that that has required collaboration because of the various partners and our involvement.

It gets very complicated.

So while you're not seeing it in the budget, we're leveraging the relationships we have and other resources out there to ensure that we're all working together and that has really proved successful right now.

and last week we were at the facility, they now have HVAC which is huge and I believe a new roof and theater seats are other large priorities that are coming.

Thank you.

Langston is just such a critical institute for our community, so wanted to make sure we followed up on that.

And I'm also excited to see the cultural planning effort is finally underway.

I know that through following your internal work with the strategic plan, we are ready to do external work of stakeholder engagement across the city.

And I know my colleague, Councilmember Rivera, via her slide last year had you outline the breadth of cultural work happening across city departments.

How will your cultural planning efforts allow us to better align with the work across departments under arts leadership to meet our community needs?

So we work with departments in various ways.

So we will be collaborating with departments where it makes sense in terms of consulting with them I'll give you one example our public art program works closely with utilities and really the utilities we consider as a customer so to speak so we will be tightly connecting with them around the future of the work that we're doing so we can map out how we can make the work more sustainable ensure that the priorities of those departments are reflected in the programs that we offer So that's one example.

Each department has a different relationship to us, so that will be examined closely.

And when we did do strategic planning internally, we began those conversations, asking more about how the programs are working, what adjustments we might need to make internally.

So we're aware right now of some of the adjustments we make, but the external discussion is more about is there an effort for youth engaged work in, let's say, City Light?

Is that something you're interested in pursuing for the next five, 10 years?

If so, let's set the structure so we can achieve that, for example.

So those are some of the things we'll be talking about.

Great, and my last question for today.

In recent years, a significant amount of ad tax revenue has been diverted from arts to fund art and cultural programs housed in other departments, programs that were previously funded by the general fund or other revenue streams, and at the same time, arts has been asked to stand up new programs with limited revenue to murals, address graffiti, and curate FIFA activations.

Knowing that you just completed a strategic plan and are heading into a community cultural planning effort, can you speak to any initial insights you have into realigning city resources to best meet the vision and mission of arts and to meet the needs of our constituency we're all trying to serve?

Director Ida, would you like to take that one?

Well, yeah, I just trace a little bit of history.

Last year we proposed, the administration proposed a policy change that would have allowed for admissions tax revenues to be spent on arts and cultural activities outside of the Office of Arts and Culture.

So that proposal was not approved, and we have not proposed to do so again in this year's budget.

So we are sort of steady as she goes, continuing to fund things along the lines that the current financial policies call for, and we are not proposing any changes in this budget.

Understood.

Thank you for clarifying that point.

And I'll close to just state on the record, I know we've had a few discussions in a few of our department presentations related to graffiti and graffiti abatement, so stating again for the record my interest in understanding holistically all of our investments into graffiti, what our and what our strategic vision is, what kind of outcomes are we seeking across our various departments.

And with that, I will yield the rest of my time if I have any of time, Chair.

Thank you.

Let me address this.

Everyone has as much time to ask as many questions as they want.

Councilmember Juarez likes to give me grief for talking too much, which is accurate.

if folks have questions and we're digging into subject matter, there's enough time for all of us.

If we're just up here talking about a topic that is not budget related, there's no time for that.

That's kind of that.

With that, we have got Council Member Kettle and Council Member Rivera up next.

Take it away.

Thank you, Chair Strauss.

I just wanna take a little time to wish your father a very happy birthday.

Thank you.

I really appreciate having arts and culture here.

Director Kayeem and Ms. Davidson, thank you so much.

And of course, with the dueling director, the bookend directors of Eder and Noble, thank you for being here.

Just running through your presentation, and by the way, I appreciate the conversations we've had over the course of the year.

so vital arts and culture for our city and being parochial so vital for District 7 as well, which is a center of a lot of the arts and culture and where it's making a difference too.

Kind of going to my colleague's question towards the end there.

Hope Corps, I think this is fantastic.

I just wanted to know, you have a great picture there of the Belltown mural.

For people who don't know, This work is starting to take on, I always talk about in the public safety sense, momentum, building momentum, but we're starting to have a coalescing of murals in that area and other parts of the city too, that it's creating its own momentum in terms of, I'm seeing it all the time now, even on personal properties where they you know, Henry, the next thing, I'm seeing this pop up all over the place now too.

I think it's creating this nice coalescing and really a focus on the arts and that has a public safety piece, obviously, because from the generations in terms of what we're trying to do in terms of activating neighborhoods and the like, but it's also not just about public safety and to my colleague's point, it's about the quality of life.

It's about a more beautiful city.

And I think now, because it's been building on each other, that it's creating its own kind of center and establishing itself in a way that it's becoming a thing.

and a very positive and beautiful thing.

So I just wanted to note that, and the work with the Hope Corps is important to that and vital to that.

I love raising the cultural planning.

You can talk to your colleague, Director Winkler Chin.

I've been talking about the Seattle housing plan forever in the day, building on the great Seattle transportation plans that have been there.

But now I can spread it beyond that and we can talk about the Seattle cultural plan.

And I definitely look forward to seeing what comes out of that and learning more about what you're looking to get out, what you put in.

in terms of what you get out and the pieces that you're looking to do.

And I bring this up too because I do believe that funding being centered in arts and culture, this goes to your question, Council Member Rink, is important and I agree that it should be there within arts and culture.

Because if it's centered in arts and culture, then we can have an approach that is centered in the arts that has a rationale across the city in the different areas and kind of a unified approach.

And so I don't know exactly what your intentions are with the cultural planning, but a culture plan could be very helpful in terms of this idea of the arts and culture funding remaining with arts and culture, which I support, and then, you know, kind of having some coalescing and, you know, a rhythm to it, you know, in terms of what we're looking to do.

So I think that's very interesting.

And so I look forward to reading the culture plan, the cultural plan.

And then I just wanted to note too, I wrote a note to myself about the graffiti work.

This kind of goes to the murals a little bit, This work is so important, and again, I recognize there's different elements of the city government that's working it.

It's centered in terms of overall oversight in the mayor's office, which goes to his priorities, which I'm in support of, because it is such an important issue across the board.

Again, not just public safety that I focus on, but the quality of life and what's happening in our city.

I appreciate your and thank you for your support of this.

I recognize you coming from an angle, an arts and culture angle.

And again, that's what makes our neighborhoods like Belltown more beautiful.

So thank you.

And it's also very important for FIFA World Cup because it is coming so fast.

and I've had conversations with parks.

It's like, hey, Freeway Park, Westlake Park, Lake Union Park, South Lake Union Park, all these things are coming and we have to be ready.

So anything that you can do because it is truly an all hands on deck effort.

And as I talked to somebody today, it's taken on even a bigger stature because we need to show the country that our city is a squared away, well run, west coast blue city.

Contrary to all the gaslighting that's been going on, on a day where our president says we should use our quote unquote dangerous cities as training for our military, which is absolutely shocking, absolutely wrong.

And you know how you counter that?

by showing Seattle what we are, across the board, and you have a play in that.

You definitely have a play in that, so thank you.

By the way, I just wanted to also thank, it's the actions of everybody that play into this.

I was down at the SAM, the Seattle Art Museum, and the work that they're doing, they've opened up their access from first.

They're reimagining their area.

the hill at the Benaroya Hall, the symphony, and what they're doing there.

If you add all these little pieces up, you know, what's going on at Mercer with the opera, the PNB, the rep, and all those pieces, and more broadly with Seattle Center, you add all these pieces up, it's great momentum, and it really shows that we're trying to put our best foot forward as a city.

This turned into a long monologue, Chair.

I didn't ask any questions.

I answered- I appreciate your perspective, Council Member.

I spoke to the question that Council Member Rink gave pretty definitively, so I support Director Eater's position on that.

And I cede the rest of my time.

Thank you, thank you.

Council Member Rivera followed by Hollingsworth.

Thank you, Chair, and thank you for being here.

I have a couple questions and then a couple notes.

I'll start with the notes I'll make, and it's just that colleagues, we all know that the Office of Arts and Culture is one of few departments that's actually funded through a dedicated fund source, the ad tax, and so that means in some ways it's protected from some of the cuts that sometimes the city has to make, although I know as of late we haven't made very many cuts, but there is a dedicated fund source for the department, which means we really are, it just goes to our commitment to the arts and how important they are in our city.

We all love the arts, so wanted to say that.

To my questions, So thank you for responding to this couple slides I put in last year, or to the slide, it was a two-part.

I'm wondering if on one of the reports, it was the municipal art plan, and I should actually back up and say on top of the ad tax that goes directly to the department, the department has a municipal art fund which is wholly paid for not through the ad tax money but through the municipal art money which is through our capital departments have 1% of their capital projects go to fund this program and then the department uses it to place art at those partners like City Light and Seattle Public Utilities at their facilities and parks for that matter.

so it's a really great way to make sure we are providing art in some other places in the city and because it's coming from those department the money has to go back there that this has been their legal issues with that and that's why it's done that way.

So I say all that to say, colleagues, again, the arts department does a lot of work in the various art spaces because, again, the city cares so much about the arts, as do I.

With the municipal art plan, the department hadn't done a formal one in a number of years.

I understand there was a spreadsheet that the department was saying was your municipal art plan that's not a spreadsheet isn't a plan so this is why I really wanted to see a plan thank you for the draft my question is are we going to get an updated version because what was submitted was in draft form so would love to get that we expect to give you an updated version I believe by the end of the year would that be correct

Yes.

So we consider that a work plan.

So it only spreads for one year.

That's the planning piece of it.

And in the cultural planning process, we'll be examining public art multiple years.

So that way you can have your updates going on while you have your long-term trajectory set out through the cultural plan.

So I think that's what that is.

It's a work plan.

It's not a plan as one would consider for long-range planning.

Understood, Director.

Thank you.

I just want to make sure we have a formal plan that can live on your website.

Yes, absolutely.

Their constituents can go look at and feel great about all the, and where all the art is that this plan and these funds pay for, because that's really important to see.

And then I'm going to bring up one thing that I, in my district, I would love to see.

chair is part of maybe this budget, that's why I'm raising it now, is there was a statue at Peace Park that was stolen of a child.

It was a statue embodying the story of Sadako, a Japanese child affected by the atomic bomb dropped in Hiroshima during World War II.

her image came to symbolize the peace movement this is a story that was written about the statue that had been there for 34 years it was sawed off at the feet and stolen and you know this has been written about across the United States and internationally especially Japan of course so it is my interest to make sure that we are able to replace that and I can think of no better sources for funding from your department to do that.

I know it's on Parks properties, so I don't know whether this can be paid with the municipal art money because that's an arts thing.

If not, I would love to see how the department can help with that and help community with that.

Yes, I can speak to that.

Our public art director has been working very closely with the community.

It was a community funded piece.

So it was not actually, I will follow up with the specific details, but I don't think it's actually formally owned by us.

They are currently working on proposals with, the community group has hired consultants and they are working on new designs right now that they hope might be They want to kind of build upon it and also are looking at how can we safeguard it so that it's not damaged, vandalized, stolen again.

So we are actively involved in those conversations with the community and we're happy to provide a more formal update on where we are with that.

I know that we had conversations with them as early as last week helping them review that.

So, yeah.

and thank you Kelly, it's true that it was not paid for with municipal art fund money, I just know that it's at the park and I know that community is devastated at this loss and so can the city.

This is like an area where I see the Office of Arts and Culture doing with community being able to bring that back to community.

Yeah, I'll follow up with details of exactly what we've been working with them on and what we can and can't provide because we've been very engaged, like I said, and we're at the ceremonies when they had ceremony after it was stolen.

Yes, it's been a really, like I said, really sad for community and particularly in Japanese community here in town.

So it was a great symbol.

So thank you and I'll follow up with you because I don't, want this to be a thing of, you know, let's do it.

Let's not find excuses for why we can't help community with this.

Let's figure out how we can help community with this.

So thank you for that.

And then the last thing I'll say, Chair, is as part of this budget process, I have not, the Office of Arts and Culture has not reached out to my office in the couple years that I've been here to talk about projects in the district, so I would love an opportunity to have a conversation about how, you know, what is happening in our district specific to arts so that I can get that information back to community and as more importantly as you are planning projects that the district is represented as well.

So thank you.

Thank you, Chair.

Thank you, Council Member Rivera.

Anything to share?

Just to that question, Council Member Rivera, obviously we mentioned that there's funding coming to your community through the World Cup investments, so that's something directly we can follow up with you on.

I'm not aware of anything in the D3 to World Cup.

So that'd be great.

I welcome that information.

We hope in later in October to be able to make an announcement about that.

We're still finalizing the selection process and making sure the selected entities are going to accept.

Well, great.

Thank you so much.

I love it.

Love to hear it.

Thank you so much.

Wonderful.

Council member Hollingsworth followed by Saka and Solomon.

Thank you, Chair, and you can just call me, Council Member, I'll be five minutes or less.

I just wanted to see you laugh there, Mr. Chair.

Thank you, Director Kayyem, and then obviously Kelly Davidson, you all for being here and your presentation, and just really grateful for the work, obviously, that you all do.

And the one thing I really appreciate is that some of your grants are multi-year when I'm talking to people.

and community groups, they're like, hey, it's a lifesaver to know that we have this ongoing funding, we don't have to reapply for it every year knowing that we got this investment.

So I just wanted to highlight that.

And then also the programs where you have small investments, where it's like, hey, there's a photographer that needs to buy a new camera and we can give them a grant for a small amount to do that upwards to your long-term investment.

Councilmember Rink was referring to Langston and certain investments.

wanted to highlight that.

And then also to reiterate the fact that if your budget could be double and triple what it is, I totally would vote for that.

I think other council members too would, because I believe arts and culture, what a lot of my colleagues do, is that it's mental health, it's education, it's wellness, it's public safety, it's all these things.

and I've never been to an arts and culture event where there was a public safety threat and that's predominantly because a lot of the arts and culture events are multi-generational for people to go to.

It's the grandma, it's the dad, the mom, whatever families look like, the kids.

It's very multi-generational and I think that's really important for people to understand these events.

One of the questions I have, super quick, high level, is some of the Funding for our Seattle Public Schools obviously is on the rocks and the first thing to go is arts and culture.

I've been talking to the people at Washington Middle School about their band director and some of these positions that are up for, that are being, not renewed and how critical that is.

And when the band stuff was going on at Garfield, thank God for all the people stepping in and particularly the Quincy Jones family as well and funding a lot of those children and the instruments.

Can you just high level speak to what your coordination is, if any, in Seattle Public Schools that you have, if there's programming, you know, people reaching out and just super high level?

So, Council Member, thank you for that question.

We actually have significant relationship with Seattle Public Schools.

Out of our office operates a collaborative project called Creative Advantage, and it is a collective impact model where we place teaching artists into every single Seattle Public School.

So last year, I believe, we counted artists in every school.

So we invest in around $500,000 from our office and then Seattle Public Schools applies for grants and invests around $100,000.

Unfortunately, federal cuts have led to that money going down from the Seattle Public Schools side of things.

So that is the program, and we are excited to partner with you in trying to solve for some of these issues.

$500,000 may sound a lot, but when you're in every single public school and trying to serve that many students, it can be a challenge.

Oh absolutely.

Thank you for that, and I know there's also that you all partner, well, a lot of programs also partner with the county for culture, and you always see people's signs, you see Arts of Culture, if they're doing an event for City of Seattle, for culture with county, and so we know that there's a lot of different avenues that people try to go through.

So just wanted, that's all my time, just wanted high level so people know that we are partnering with Seattle Public Schools on some front.

Thank you.

Long-term, it's a 10-year relationship, so we've, yeah.

Thank you, and up next is Council Member Saka, followed by Solomon, myself, and then Council Member Rink.

If we all speak for 10 minutes, we will be here until 3.50, leaving 70 minutes for SDCI.

Over to you.

Thank you, Chair, and thank you, Director Kayyem, Ms. Davidson, as well, for being here today and presenting a proposed budget.

Love the work you all do to support our vibrant arts and cultural scene.

And important now more than ever for a number of reasons.

But just want to center and uplift the vital work you all do.

Councilmember Hollingsworth mentioned the work that you all do touches every single policy area and topic and I know it wasn't intended to be an exhaustive list but I would add economic development and stimulating our economy to that as well amongst other things of course.

My question pertains to the graffiti investment that was highlighted in, I think, slide five.

First off, I'll just say I'm excited about the broader suite of investments to better abate problem graffiti in our city while also simultaneously providing a platform and avenue for street murals and arts, which I think adds to benefits the vibrancy of our broader city and creates, I don't know, it's just cool.

But it has to be mutually agreed to.

So I note the $1.6 million broader suite of investments across multiple city departments and agencies, you talked about that, but would just love to better understand what's currently planned in terms of your department's specific implementation of that.

Like what's in scope for your department to enable the broader effort?

So just to be clear, this effort is led out of the mayor's office.

Our department hosts the individual who works across programs.

So we do not guide the work.

It's really the mayor's office that guides the work and plans for the work.

So I'm wondering, Dan, if you could provide some context.

Yeah, there is, in fact, a $6 million level of effort here.

1.6, I think, is what was added in the proposed budget.

And what I would propose, because it's too complex for me to do justice to here at the table, is that we follow up and get you some more information about what that big picture looks like and which departments are affected, both the base budget and the added budget, if that's acceptable to you.

Thank you, Director Eder.

Yes, that would be helpful from my perspective.

I'm curious to learn more about specific implementation.

I love the broader investment and the concept.

but I'm just curious to learn more about how that would be operationalized and executed.

And it sounds like Council Member Rink as well and others might have questions.

So yes, please do follow up accordingly.

My final question pertains to FIFA preparation and planning.

You mentioned FIFA a couple of times.

pending announcement of some sort for next month.

So you got us all at the edge of our seats here, like, oh, what are they gonna announce?

Hopefully it's 80% of the projects will be in district one, where people will be.

But in any event, can you talk a little bit more about how, Respecting the pending announcement we have coming, but can you talk a little bit more about how this proposed budget would support FIFA and the unique stage that we have coming up here in just a few short months?

This particular budget doesn't have direct FIFA investments.

That happened last year.

The $2.5 million was committed last year, and the reason for that, Council Member, is because we needed to contract with folks this year so that they could deliver in 2026. So that's why I talked about that, so that you know that those investments are coming.

And one of the examples will be the...

announcements that we're about to make.

We work on community-engaged processes in our office, whereby we're not just handing out contracts, we're sitting with the community and going through a process whereby we're selecting artists and commissioning artworks.

So it's longer than other processes.

So I hope that makes sense to you.

That's why we need some runway in order to get the investments out the door.

So in this budget, there's really no FIFA investments at all.

It's last year's budget.

Got it.

Okay.

Thank you for that clarity.

And then just a final comment for the good of the order, plus one, onto Councilmember Rivera's earlier plug and request for a briefing and kind of update on D1 specific projects.

Absolutely.

If you're amenable, would love that.

Thank you.

No further questions, Chair.

Thank you.

Council Member Solomon, you are recognized.

Thank you very much, Mr. Chair.

And thank you for being here, thank you for your presentation, and thank you for the previous conversations that we have had about art and what I look at as community activation around art.

To that extent, quick question, the mural on slide five, where is that located?

I believe that's on the west side.

This is West Seattle.

This is right at the end of the West Seattle Bridge.

Oh, OK, great, great.

Because one of the things I talk about when I teach SEPTED is using public art as a draw to bring more eyes into that space.

And I've seen it not only as an effective draw, but also as an effective anti-graffiti program, seeing other cities using this to activate those space.

Auburn is an example of another community that's used public art as a way to graffiti.

And I think about some of the public art that I've seen on certain buildings, whether it's the MLK mural right there on MLK and Cherry, or the Jacques Cousteau that's on the side of a building on Capitol Hill.

So and with each one of those that I've seen, including the one that's on the side of the Safeway on Mothelo Street in the south end, because those murals were done by local artists, they have never been tagged.

So wonderful to see.

Want to see more of that public art coming online.

and as well as not only using the, you know, the murals on walls and sides of buildings, but also seeing how utility boxes, junction boxes have the artistic wraps around them.

Some of the most creative ones I've seen are actually in D1 Council Member Saka, like Bruce Lee one that's on 35th and Morgan, for example.

So with that, you know, again, looking at, those supports from your office to those community organizations, to the schools, an example, to foster those kinds of projects.

One question that we, or one matter we had talked about in the past was the idea that of a graffiti park, for example, you know, something that Palm Springs does with their Thursday night markets.

they have a certain park that's set aside for people to come and just tag stuff up to create their art.

Is there a plan or a consideration for something similar for us to do here in Seattle?

I'm not aware of any conversations in our office around that, but it's certainly interesting to consider.

Again, this type of thing would be considered through a cultural planning process whereby we would look at what the community's interests are, what the priorities of your office is, and what constituents are looking for through our programs.

So, yeah, we'll be also looking at other cities and how they implement their public art programs, including graffiti prevention or graffiti mitigation strategies, and I think that's what you're speaking to here, is a graffiti mitigation, yeah.

So that's something we would consider within that structure.

Okay, great, thank you.

No further questions, Chair.

Thank you, Council Member Solomon.

Just marking myself down at 318. Reading from the six-year budget look back between 2019 and 2025, the arts budget grew by $10.5 million, a 70% increase.

While standard inflationary factors such as annual wage adjustments and rising benefit costs affected arts as they have all city departments, The growth in the arts budget was mostly driven by the increased revenue from the city's admission tax and the city's 1% arts program.

I'll share that I know last year's policy conversation about is all arts funding in your house or are we supporting events like Festall and what's going on at the Seattle Center?

Is that comfortable or not?

I know that that was a conversation we had last year.

We ultimately made the decision to continue funneling it through the Arts Department to these other organizations.

I thank you for that because as we have this structural budget deficit, and a 70% increase from a dedicated fund, this helps us continue making places like Seattle Center vibrant.

We had Seattle Center up here earlier.

They're barely able to keep the lights on, much less add funding to programs.

And so right here is just to start you off with a thank you for being flexible, nimble, and partnering with the other departments within our city.

and I know that it's not just with the Seattle Center.

It's with not even organizations within our own city that you're partnering with to increase the vibrancy of our city.

The murals are critical for placemaking.

I'm seeing that happen in Ballard.

I'm seeing it happen on Capitol Hill.

and just, I'm starting to take notes about District 1. Got the newest fire engines, the newest ladder trucks, the most dog parks and the most murals.

All right, Council Member Saka, I see you.

But Director Noble, I'm gonna ask you a question about our structural budget deficit here.

Since these are, this is a department that has dedicated funding from dedicated funding source, no general fund.

How does this play into our structural budget deficit?

Sorry, that's for Director Noble.

One of the issues that was implemented last year and then is repeated this year and is anticipated, one of the approaches that was implemented last year and is repeated this year and is intended for the future is to use some of that dedicated admissions tax funding to support what had previously been general fund-supported activities.

So in that way, we're helping to mitigate the general fund deficit by being more creative or more internally directive of some of these dedicated funding sources.

So if you try to undo that, you will be growing that deficit again.

And although from a policy perspective, I can understand why that might be a desire to get more of the money to the outside arts community, if you will, rather than the inside the city arts community, but doing that will put pressure on the general fund and thus expand the deficit.

But at the moment, we're using these resources to help mitigate the...

And it is...

This won't be a popular thing to say, but it's not my job right now.

You could direct yet more of the admissions tax money towards internal things that are arts-related and further relieve the general fund.

And as you approach 2027 and the deficit you're looking at there, you might be forced into that or might want to consider that, and it's certainly something you could do this year as well.

But again, that would be a trade-off of outside funding for inside funding, if you will.

Thank you.

Director Kaima, any thoughts here?

It's an uncomfortable conversation, but we just love everything that you do.

I think if all of us had all the money in the world, we'd have murals on every building.

Yeah, absolutely.

It's tricky because we very much want to support our sister departments who are struggling, to pay for services.

I mean, ultimately, it's your decision.

One thing to note is that ad tax is very volatile.

We've seen decreases this year due to declining tourism.

So not just us, but organizations as well are experiencing ticket sales going down, and so the revenues that come to us have stagnated.

So in terms of thinking through a future out years, our ability to build on our budget or build programs such as Hope Corps, for example, are just very, very limited.

So as you make these decisions, just know that we're going to have to adjust internally and probably cut some things or rethink some things.

in order to make it feasible.

But those are the trade-offs in terms of the volatility in that resource.

Also, we do not have any other way to raise revenue.

So we don't have a foundation, which other departments may have, to go out and get some private dollars to support the work we do, but that may be something to consider in the future.

Thank you.

Councilmember Rivera, I see you've got another hand.

We are rapidly running out of time.

Do you want to read your question into the record?

Yes.

Fair enough.

The floor is yours.

Thank you, Chair.

Well, just what you just mentioned, Director, it's not my understanding that this year's budget is being impacted by any cuts, so that's- No.

Great.

Good to hear.

I'm just thinking about future decisions.

Understood, understood.

My question is about the second part of the slide, which was a report as the main arts department.

The SLI was requesting you to work with your sister departments to make sure that we need insight as to all the arts things that are happening in the city and it seemed like you would be the best repository for that since you are the Office of Arts and Culture.

That's what the SLI was getting toward.

I hope that the department will continue to be that repository because otherwise it's really hard to know what all the arts things that are happening across the city family if we don't have one organization that is tracking that and so thank you for putting that list together and I hope that there is some database or some way to continue to track so that if we get asked or we want to know in our district for instance what may be happening we have one centralized place.

So that was the point and so we can talk more about that later.

But thank you, Chair.

And sorry, what was the question?

Well, whether they're gonna continue to update this spreadsheet over time or was this just like a one-time, I would like for it to be continued.

Okay.

A continuation of.

The slide that we did this last year, you'd like to do it again?

The information that the SLI asked for, it didn't give an end date, so I'm hoping that it'll be ongoing.

I guess that's what I'm trying to say and the clarity I'm trying to bring.

We can follow up with you individually on that, Council Member.

Thank you.

Fantastic.

And Council Member Rink, last word, and then I'll pass it back to the Director and the Arts Department for their last word.

I simply want to thank Director Kayyem and your team for the incredible work that you do, turning things around, setting the stage for the cultural planning effort that will deliver on the promise of what this department can be for our community.

So I just want to commend you and thank you for your work.

Thank you, council members.

Anything to close?

No, I just really appreciate all the questions and we'll be following up with each of you to ensure that we've captured all of your questions and concerns.

Fantastic, thank you for making our city more vibrant.

We're gonna now transition to the next presentation and I'll filibuster a little bit as we're making that transition, just to say I really enjoyed getting to engage in one of the graffiti events at the Firestone in Ballard and shout out to Sire and my apologies for painting over your face.

I did not realize that was your face before I started painting, but that's a good story for another day.

We have Seattle Department of Construction Inspections up next.

We're getting the PowerPoint presentation uploaded.

And we have one hour and 33 minutes before close of business.

Colleagues, I'll continue sharing how much time we have remaining, much like Google changes your time when there is increased traffic.

With that, will the clerk please read item five into the record.

Agenda item five, Seattle Department of Construction and Inspections for briefing and discussion.

Thank you very much and I am pulling up.

Just wanna thank Interim Director Kay Lee and Shane, I'm gonna let you say your last name on your own, as well as Director Eder and Director Noble as always.

Over to you Director Lee and we'll hold questions until the end.

Good morning, Chair Strauss and Council Members.

Thank you for the opportunity to present the Seattle Department of Construction and Inspections 2026 proposed budget.

My name is Kay Lee.

I am the Interim Director of SDCI.

I've been serving in this role since July.

I will let Shane introduce himself.

I'm Shane Mukhoff and I'm the SDCI Finance Director.

We're also joined here today by our colleagues Jeff Tallent, who is our Code Compliance Director, Scott Domanski, our SCCI Economist.

And you may have already heard, but we announced this morning that Brooke Bellman, who served in a variety of roles at Sound Transit, including Deputy CEO and Interim CEO, will be starting tomorrow, actually, as the Interim Director of SCCI.

So today is actually my last day.

Just want to say that it has been an honor to serve as interim director and to work alongside such a committed and talented group of colleagues in this department.

So SCCI plays a central role in ensuring our buildings are safe and that our communities are healthy.

Each year we review more than 55,000 permits, conduct nearly a quarter million inspections, and respond to about 40,000 compliance contacts.

This budget reflects Mayor Harrell's one Seattle vision, balancing fiscal stewardship with essential services, advancing equity and tenant protections, and preparing for major projects like Sound Transit's expansion.

With the proposed investments, we will improve the predictability and speed of permitting through the Mayor's Permitting Accountability and Customer Trust Initiative, sustain our core services, and strengthen customer service while keeping Seattle resilient and sustainable.

Just as a reminder, SCCI is mostly funded by permit fees, so state law restricts the permit fees that we charge to pay for the related services we provide.

The 2026 budget is about balancing three core needs.

One, delivering on the mayor's pact initiative, which will simplify the permitting process, reduce back and forth between staff and applicants, and cut review cycles in half.

This means applicants will get a faster, clearer answer from the city.

Number two, preparing for the major volume of sound transit expansion work.

We expect nearly 600 permits related to the West Seattle Ballard Link extension.

This is one of the most complex infrastructure projects in the city's history, and we must be staffed to handle it without slowing down other work.

and then third, maintaining essential services like inspections, code compliance, and tenant protections, while also meeting the citywide requirements to reduce general fund spending.

The result is a fiscally balanced plan that sustains core services, invests in process modernization, and positions SDCI for long-term stability.

One thing to note in this slide is that the drop you see in FTE counts for 2026 is actually due to abrogated sunset positions from the 2025 adopted budget that were extended six months by council last year.

So I'll be talking about the implications of this slide later on, but as you can see from these charts, master use permits have dropped off significantly since around 2019. This is mainly due to market and economic conditions and changes at the state level that exempt many projects from SEPA and design review.

On the building permit side, volumes have been trending upward slightly since 2023. However, project valuations have been lower because we have been moving more towards smaller, less complex construction projects.

So another way of saying this is that while the workload hasn't dropped, revenues are down because there are fewer, more expensive projects.

Due to these factors, we are proposing an 18% increase to most construction and master use permit fees.

A full 35% increase would actually be needed to cover current costs, but we are taking a phased approach to avoid a sudden burden on applicants and give options to pivot if permit activity increases suddenly.

The legislation also simplifies fee tables, introduces incentives for seismic retrofits of URM buildings and ensures costs are distributed more equitably.

So here we show three specific examples of common projects in Seattle and the impact of these fee increases.

The first example is a 500 square foot ADU, and you'll see here that the average change is about $543 per unit.

For a four unit townhouse, that's about $560 a unit.

And then for a 230 unit apartment, we were talking about $219 of an increase per unit.

This slide shows two scenarios to our core reserves.

So SCCI sets aside funds to retain trained staff during economic downturns, ensuring their expertise is available when the economy rebounds.

This prevents delays caused by hiring and training new staff and supports strong customer service and timely permanent reviews.

SCCI keeps these reserves so that when a recession hits again, we are able to maintain services and be ready for economic recoveries.

So to reduce this fee burden, we are also proposing to defund two vacant positions, a strategic advisor and an IT professional that have been unfilled since 2024. Their responsibilities have already been absorbed by current staff, so there will be no impact to core services or customer-facing work.

This is an example of right-sizing our staff to reduce pressure on fees and align resources with actual workload, and this would still maintain our position of authority to hire back these positions if they are needed in the future.

The budget also includes $500,000 one-time ad and $250,000 ongoing for AI permitting software.

This technology will help applicants submit stronger, more complete applications upfront, which reduces errors, shortens review times and improves consistency.

They will get clear guidance and have a better overall customer service experience.

And for staff, it means more time spent on higher value work like one-on-one counseling rather than fixing mistakes or finding small errors.

Another noteworthy addition is the inclusion of 100,000 to design a program that incentivizes property owners to preserve large trees through conservation easements.

This supports an upcoming tree preservation executive order recognizing trees value and directing policies to preserve significant species and groves on private property.

This is another tool that will help reach the city's climate and sustainability goals and is an example of working with community partners to preserve large trees when possible.

So in closing, this budget sustains our core functions, modernizes how we work with applicants, and prepares us for once-in-a-generation projects like sound transit expansion.

By phasing in fees, right-sizing staffing, and introducing innovations like AI permitting and tree preservation incentives, we're not only managing today's challenges, but investing in a stronger, more resilient future.

This proposal gives applicants predictability, equips staff with the tools to succeed, and ensures our communities remain safe, healthy, and sustainable.

So thank you again for your time, and I'm happy to open up to any questions.

Thank you, Director Lee, and congratulations on your last day.

I wish we could keep you longer, but I also know that the incoming interim director has changed the way our region, feel the built environment of our region in really positive ways.

So I'm excited for them.

With that, Council Member Salomon as chair of the committee, the department reports to you are recognized.

Thank you very much, Chair, and I want to thank you for your service in this role for the time that you've been here.

So I do have a few questions, and actually I've got a lot of questions, but in the interest of time I won't use them all.

First thing I want to ask is how may the updated comprehensive plan affect demand of or work responsibilities for SDI staff?

I didn't hear the last part of it about the comprehensive plan.

Basically, regarding the comprehensive plan, what do you envision how that might affect the work of SDCI staff?

Well, it could bring in some new permits, I guess, because we're looking at more middle housing, right?

but we are prepared for any jump in permitting activity.

I think we have staff that are trained up and ready to go.

If more than we anticipate comes in, we do have contingent budget authority to hire rapidly and train up new staff.

we're unique maybe in the sense that our department has the contingent budget authority to do this and hire, you know, be able to hire quickly when we need to bring on more people.

Cool.

Which actually leads to, you know, the second, kind of like the second part of that.

You know, what would happen if demand for SDCI staff time exceeds staff capacity in light of the permitting reform legislation we recently passed?

Yeah, so I think it's similar that we want to keep enough staff so that we can process the permits effectively and quickly.

And we don't want to reduce staff quickly.

In the case right now with our revenue shortfalls that we have, we want to be able to, the core staffing reserve is to keep staff trained and working while we have dips and then be able to come up quickly whenever the permit volumes start to rise again.

And so, I mean, right now it's not the busiest time of the year, but we do see the increase of permit volumes trending upwards while we do see the values and the permit fees dropping at the same time.

So that's one reason why we have this fee increase.

Okay, great.

Thank you.

And I know from my own personal experience, you know, you all have heard me talk about the shed.

And having that forward-facing customer service, somebody I could have talked to about to help me navigate the system as to how to do the permit, what was actually required, as opposed to me submitting things and then getting corrections that I had to address.

I think is going to be critical especially because I also see that as decreasing the time to actually get a permit through so that we can get projects going in a more quicker manner.

So I appreciate that we're going to see more of that customer service focus up front as opposed to on the back end with corrections.

If we haven't already, I've directed staff to reach out to your office and to you to find out a little bit more about your experience so that we can do a case study on what exactly happened in your case and find out if there are ways that we can make improvements to that.

That would be great.

I appreciate that.

The final thing for me is something I've talked to was as we are basically codifying SEPTED into, you know, into code.

You know, we have an amendment from Council Member Kettle that inserted into the comprehensive plan.

We've got it baked into the interim design review legislation which will hopefully become permanent in order for SDCI to with confidence be able to do those reviews, there's going to need to be a budget set aside to train SDCI staff in CPTED to get them certified so that when those, you know, when they're looking at those plans, you know, they are looking at with that lens, but they need the training to be able to do that.

So specifically what I'm looking for is training dollars for SDI staff to get CPTED certified.

Director, is that already in there or is that a supplemental ask?

I just don't know the answer to your question, Council Member, but I'll look into it and try to get you an answer.

Okay, great.

Thank you.

I don't have any further questions at this time, so I yield the rest of my time.

Thank you.

We have Councilmember Kettle followed by Councilmember Juarez.

Thank you, Chair Strauss, and thank you, Director Lee, Mr. Mukhoff from SDCI, and once again our bookend directors, Eder and Noble.

Just piggybacking off of what Council Member Salomon said, obviously he's not the only SEPTED person on the diocese.

I'm a big fan of crime prevention through environmental design too.

And to the point that he was making, I recognize there might be some challenges of setting that up, but bigger picture as it relates to with public safety and just the quality of life and so forth.

Including SEPTED as part of the process early basically equates to an ounce of prevention's worth a pound of cure.

And that cure may show up in other places in the city budget or whatever.

But it could be money well spent.

I just throw that in Director Eder.

as a thought in terms of the concept of a ounce of prevention is worth a pound of cure that might be worth it.

My interaction with SDCI over the last 21 months is usually some big project or some issue, some code like, hey, what's going on here?

There's like Belltown and so forth.

very positive in terms of working with the department, by the way.

I just want to throw that out there as well.

But then I also get folks coming at me saying, what is the city doing?

What is the city doing?

And I'm sure you've got your versions of this.

But I know these people, and a lot of them, not all of them.

And it makes me wonder if there's something there there.

And so I just wanted to I got an email just recently from one of these folks and he writes, Bob, let's break the logjam and hire folks at SDCI that are professionals and if the City of Seattle is going to hire others without professional training or those that have the education and do not have the practical experience, pay them to work with real contractors for six months as part of their training.

He adds, most of our loans are on the east side and south of the city of Seattle limits.

We are thriving in other areas while all of our small builders struggle to make money building homes in Seattle.

Construction 101, go to the job site.

I just wanted to ask in terms of like, you know, bringing on people and you know that a your reaction and your thoughts based on your experience and and I guess the second part is do we compare like how we're doing to the other jurisdictions in the region east side or to the as he mentioned to the south and north just to see do they have a comparative advantage because they're doing something a little bit different you know is there any kind of understanding in terms of to what what's being implied here that things are better smoother faster in other jurisdictions

Yeah, there's a big question there, actually several things that I could say to respond to that.

First off, I would say that I've been in this role for just a few months now, and I would say that one of the things that I found as soon as I joined the department, I had been working with some of these folks in my previous role in the mayor's office, They get a lot of, our department gets a lot of criticism from the public and some of it is well-deserved criticism, but also I would say that some of it also is probably not so well-deserved.

We have a lot of committed, highly educated, highly trained staff members at the department.

A lot of them are working very, very hard to try and help our applicants get through the permitting process, which is not something that that folks generally want to do or like to do.

So I'll say that.

I think there's always room for more trainings, more on-site opportunities to go see these.

If we had more time, it'd be great to have more of these site visits and to be able to see more of these projects in person, and we try to do that as much as we can.

but I will say that it is something that we are continuing to look at in terms of staff capacity and what we're able to do.

The second question was around comparing with other cities.

I will say that we do, our staff are in sort of constant communication with our surrounding jurisdictions around best practices and we are also sharing data constantly.

I know that we tend to do get siloed in the work that we do here at the city.

We've got our work that we are having to, our workload that we're having to get through.

It's something that we do, but we obviously could do a better job at coordinating.

We also, I know that we talked to a lot of folks who are not only just in our local jurisdiction, but we compare data to our peer cities like San Francisco, Portland, LA, et cetera.

So Shane, do you have any else you might want to add to that?

Well, I think it goes both ways.

We've had San Francisco and Portland reach out to us for advice and help in certain situations when it comes to fees and everything from CBA that we have and some other questions that we've had.

And we do constantly look at how they work, how they're structured.

You know, I think Seattle is pretty unique in the way we review permits and land use compared to some other cities.

So it's really hard to compare apples to apples with us to other cities.

But I think there's always lessons to be learned from other jurisdictions and vice versa.

They learn from us as well.

Okay.

I just asked that.

I mean, and it's helpful for you to know what we hear.

And by the way, I'm more than happy to set up a coffee meeting if anybody on the staff wants to, would like to meet him and hear directly.

And I think he would welcome that too.

And so I just, again, just to put it out there.

And I was curious about the comparison to other jurisdictions.

So thank you for speaking to that.

Two more quick questions.

One is on AI.

I've had meetings with Microsoft and Amazon and AI.

I've been with Mr. Lloyd or Mr. Seattle IT with meetings on IT and AI and some of the good and the bad of AI.

How do you feel in terms of bringing AI into the world of SDCI?

Sure, I'm actually very optimistic and excited about bringing in AI, especially in the permitting system.

I think this is one of those areas that we could really see some exciting innovations there.

Bottom line is, it's not going to solve all of our problems.

We definitely need, this is a human in the loop problem.

And so we're gonna need our folks to utilize AI in a way that helps them do their work more efficiently and better.

but I'm very excited about the pilot programs that we are currently running right now.

We've got two going with several more that are in the hopper and so we are being very careful about how we roll them out but so far the initial results are very, very promising.

Okay, thank you.

I just wanted to add that I think along with the packed IT investment that we have, it's gonna help a lot for the customer to fill feel like they're better prepared coming into it.

I mean, that's the goal, and to help them submit a complete application and not be as confusing.

Roger, thank you.

I just wanted to, one last point is Council Member Solomon brought it up.

Actually, we haven't voted on it yet, final, but the comprehensive plan, which I also called the Tree Ordinance 1.5.

And I just wanted to to say thank you for the significant addition slide number two.

And I recognize the challenges that we have in this front, but the old adage, since the Mariners are in the playoffs, tie goes to the runner.

I think tie goes to the trees.

And so I appreciate this program that you have in terms of being more forward-leaning as a respect to our trees and your engagement on these issues.

I just want to say thank you as well.

I'm thinking about some big cedars in Madison Park.

Where is that located?

I think in District 3, I believe.

But anything that we can do.

And so I like this piece here.

So thank you very much.

Chair, hopefully that wasn't too long.

Thank you, Council Member Kettle, Council Member Juarez, followed by Saka and Rink.

Thank you, Chair.

Thank you, Director Lee, for this information and sorry to see you go, but thank you very much.

Two questions.

I want to go to slide five on the fee adjustments.

I think that's kind of a misnomer because it's just fee increases, correct?

So when I look at permit fee adjustments of the 18%, and what you're contributing to these increases with the reduced revenue from the project mix.

And then you state or your team states policy shifts.

So what are those policy shifts that contribute to an 18% increase?

The policy shifts are state and city changes to design review and SEPA.

Such as?

A lot of projects don't need to go through SEPA and design review anymore, so it saves time.

But it also saves them money, and it's less revenue for us that comes in for that.

And we made a change last year with the layoffs for land use staff because of that reason.

But now the rest of it is just the project mix that we have.

There's no large complex projects really in the pipeline.

It's mostly small and mid-sized projects.

And because of that, we still have the volumes, but the revenue doesn't come in from the smaller and mid-sized projects because I think they were being subsidized a bit by the large projects in the past.

So we had to increase fees.

I would just add that those changes were actually made at the state level, exempting projects out of SEPA if they include housing.

Okay.

Can you give me an example?

Mr. Eder's looking at me.

Dan's looking at me.

I think there were some projects that were exempted from SEPA altogether.

Others that we as a city exempted.

Affordable housing projects are exempted from certain kinds of design review processes as a couple of examples.

I can't give you examples of what changed at the state level.

Are you able to?

No, but we can get that information to you.

Well, the reason why I just flagged, and I'll have one more question after this on slide six, is because, you know, when you said policy shifts, I'm thinking, okay, what did Seattle City Council do to make you increase at 18 percent?

So you're telling me it's mainly on the state side with SEPA.

I think that's right.

Okay.

That's fair to say.

So that's a great segue into my second question and my last question on slide deck six.

So this is perfect.

You set me up for a great segue here.

So do you foresee the increase in these fees hindering the penciling or current future development?

And it sounds like perhaps it does or will it?

So the question is if...

I'll restate it.

I actually have it written down, so I should probably just read what I have in front of me.

It says, do you...

Well, we developed these questions because I was concerned about the 18% increase.

Do you foresee these fees hindering the penciling of current or future development?

So does this 18% increase, is this going to hurt us in current and future development?

That's a great question.

I would say that...

This is a small drop in the bucket for a lot of projects.

I think what they're looking for are reduced interest rates, better economic conditions, more macroeconomic changes that can help drive the development.

I don't think that this is going to affect that.

Okay, so the answer is no.

No, I don't think so.

I don't think they're gonna stop a project for a 4,500 square foot four unit townhouse because it's gonna cost $2,000 more in a permit fee.

Well, it might if you're building 230 units and you go from 274,000 to 324,000, correct?

Yeah.

Okay, well.

We also have a table called the D1 table that's a valuation table that shows the value as how we get to these numbers.

And we value these projects very low compared to what the market rate value is.

We're not even close to market rate value.

We're not even close to the property tax value.

You know, it's really just a box that we're valuing.

So that is, you know, we're valuing these projects pretty low to begin with.

Okay.

So when you say a drop in the bucket, the big picture is it's mainly what one of the outside pressures is the macroeconomics.

Is that mainly what you're saying?

Yeah, it's the vacancy rates, it's the interest rates, macroeconomic, the things that are kind of beyond our control.

The reason why I'm saying this, I'm not trying to pick on you, it's just that when we talk to developers for profit, non-profit, and then when this is for public consumption, when they see this, I can in normal lay terms say, it's not as bad as you think, because, as you said, a drop in the bucket, because the bigger picture is interest rates, macroeconomics, tariffs, all that big stuff, and these are already ranked low as it is, correct?

Okay, so is there something you wanted to add to that, Dan, or Chair, I mean Director?

No, you're absolutely right.

It is an increase and it will certainly have an impact on their bottom line, but as Shane mentioned, I'm not sure that it would actually make a difference in terms of a project actually pressing go or not, but it will certainly have an impact and we will definitely be hearing from builders on this.

and I say that too in conjunction with Chair Hollingsworth on the comp plan with all the up-zoning and increased zoning capacity.

So that's what I'm really getting at here.

And I see Shane as a man of few words.

Thank you, Shane.

I like that yes, no.

We would prefer not to have to increase the fees.

We'd also prefer not to increase or have any taxes.

It's the price of doing business on some level as unwelcome as it will be in the development community.

They are, as you've just been hearing from the department staff, relatively small dollar amounts that are probably not the driving force in a go-no-go decision on almost every project.

Okay, I just wanted to put that in context, that's all.

So if you're a non-profit developing 230 units, you can explain why the 18% increase isn't that, I don't want to be flippant here, that big of a deal, but as you were saying, I'm sorry, Director, you were going to say something.

No.

Oh, Shane.

You know, we're an enterprise fund and the RCW is a state law, E20-2020, which we live by and we exist by, which means that we have to recover the costs of the services we provide.

Right, you can't generate revenue from this type of fee.

Got it, that's a state law.

We can generate the revenue in order to pay for the staff that we need to perform the services.

The alternative is to lay off a lot of staff and have degraded services.

and permits would take much longer.

It would be a very inequitable way of dealing with this situation, I believe.

And nobody wants this to take longer.

I understand that balance from suing the state for revenue generating taxes that don't go back into the fee or the service that's provided.

You're not supposed to tax to make money.

You're supposed to tax to support the underlying act of the agency or the government.

So I got that.

Okay.

Thank you, Chair.

Thank you, Councilmember Juarez, Councilmember Sacca, followed by Rink and Rivera.

Thank you, Chair, and thank you to Director Lee and Shane for being here today.

Director Lee, appreciate your service, your selfless service to the city in this capacity over the last few months, despite the fact that today's your last official day in role, but appreciate all the work and stepping up to the plate here.

First off, let me note that Your comment earlier about some of the permitting challenges and some of it based in truth and some of it based in perception or misperception in certain instances, I would generally agree with.

As a general proposition, I think there is an opportunity for us to better streamline our permitting processes and improve the efficiencies of permitting here in our city and many cities across our state.

and I think the legislature and the state legislature and even this body has taken steps to directly address that via legislation and on top of other investments to better support that.

That said, I also think sometimes your department gets gets a bad rap in certain cases, is like the catch-all, blame-all for things that might not necessarily be permitting challenges.

Case in point is my office recently learned of a purported permitting issue that was blocking the opening of a small business in my district that a lot of constituents are excited about and then we engage directly with the impact of small business and then SDCI and learn more about what was happening and turns out the business had You know, they were facing $30,000 in plumbing costs that was ultimately preventing them from opening up, and certainly in a timely manner.

And that is a significant sum of money, especially for a small business.

And so again, we learned less of a permitting thing and more of a business operational challenge.

policy choice there.

Are we gonna create one-off exceptions and revise our building standards and habitability standards?

No.

But we do need to, with respect to the stuff we can directly control, we do need to streamline that.

But I love, love, love the work that you all do.

It helps bring to life housing for all.

It helps to bring to life in this case, the case that I just mentioned, small business supports.

It ultimately helps to bring to life opportunity.

And so really love what you all are doing.

And I appreciate the partnership.

I'm working with some community groups and an investor right now in my district to open a food truck.

park in my district.

Really excited about this, trying to broker.

There's a SDCI play, there's a Office of Economic Development play, maybe a few other city departments, but that just shows, that's just a glimpse of some of the work that you all do or are involved with to help bring to life opportunity.

On the small business support side, so I understand that SCCI has a small business and cultural permit advisor to help small businesses navigate the permitting process, which is very, very challenging.

And given the scale and complexity of permitting challenges, especially for smallest individuals, organizations, small businesses, less sophisticated advisory teams that can consult on these kind of things.

Is a single, in your view, is a single position for this sufficient to scale across the entire city?

So, I will say probably, we could probably use more resources in that area, not just for small businesses, but I think permits in general.

It would be nice to have maybe one or two more permit, we call them expediters.

I will say though that, and Peter Furbinger, who is our small business permit expediter, does a wonderful job.

In an ideal world though, we wouldn't actually not need permit expediters.

We would be able to fix, not have to utilize another person to help businesses, however complex they are, get through our permitting process.

At the same time, yes, I would say, It would be great to have another Peter in our department and something we can certainly take a look at depending on his, looking at his workload.

I know that he's pretty, he's got a lot on his plate.

But I would also say that we also, at the same time, we need to be working towards a process where we don't need to actually rely on a permit expediter.

That we have folks in the department as part of their jobs that are helping applicants get through as quickly as possible.

Thank you.

And my interest is just to ensure that small businesses can open their doors without unnecessary delays caused by navigating the permitting process.

in my senses if we did straw poll it would be a shared priority across this dais but in any event just want to thank you again for the work you all do when you I think my office has been already engaged with some folks within the department on the food truck thing in D1 but appreciate your executive level sponsorship to ensure we get that across the line and you know expedite our own internal city reviews to the extent possible so thank you no further questions here

Thank you, just taking notes.

Most murals, newest fire engines, ladder trucks, most dog parks, food truck.

What's next, a foot ferry?

Oh, you already got that.

Over to you, Council Member Rink, and then Rivera.

Thanks to thank you, Chair, and thank you all for being here today.

You know, Council Member Ruiz was reading my mind a little bit with the questions just about the 18 percent increase and certainly sparked a bit of heartburn in me, and I just, I want to ask a couple of questions about this just to dig in a little bit deeper, understanding, you know, I had similar questions about how this may chill housing development, but understanding that SEPA plays a role here, but also that much of the staffing for the department, funding for the department, comes from permit fees.

I'm wondering how this compares to our partners at King County, if they have a similar kind of model for revenue coming into the department, or if they have more of a general fund model funding their permit department.

From what I know, King County did have a major increase, fee increase, I think it was close to 50% for their building permits.

that started this year.

And a lot of that was a reaction to some of the, I think it's the state laws that they had.

I don't remember the numbers precisely, but it was for processing permits faster.

So King County went through a process of also increasing their permit fee amount?

They did.

by about 50%.

And we can follow up on this point.

I'm just curious.

And Portland, on the other end, they laid off, I don't know, 70 people.

Wow.

And just as a reminder, that is the approach that we took last year when we had the, I don't know, second or third year of slowing permits, primarily because of rising interest rates, pandemic, rising costs of goods and services.

We laid off a number of SDCI permit reviewers.

We chose not to go that route this time, and we think that's the the right answer for this year.

If I might, there's a little bit of speculation here, and these gentlemen can perhaps respond.

I think part of the issue here, I think just to sort of understand the underlying economics, is that we have an operation at SDCI that has a certain scale, and it can be scaled back, but it has a certain level of overhead and centralized function, regardless of how many permits are issued.

So that as the state reduces the number of permits that are required, and as the number of actual folks interested in pursuing permits declines, the total number of permits coming through the system is lower for both policy reasons and economic reasons.

And we can lay off some of the folks, and we have, but at some point, just the total cost of that operation, including its fixed cost, if you will, its overhead, is still there.

And the system is set up so that SDCI is entirely self-funded.

And we're not in a position, I would argue, to put general fund there.

This becomes a question of how they scale this operation, and they've brought it down to some level of scale, but if you bring it down too far, you just get fewer and fewer people actually reviewing permits, and you're not generating enough revenue.

So we're caught, this is a classic rock and hard place here, but it is the actual volume of permits, this is the irony here, is the volume of permits declining is one of the pressures on increasing the actual permit cost, because we still have the same, even though we still have some of the same operation to run.

You get returns to scale when things get bigger, you get loss of scale when things get smaller.

We're, I think, suffering a loss of scale, and that is part of what's driving this cost, because it's certainly well above inflation.

And I don't know this, but I feel like there's a piece here we've not talked about that is worth describing.

Just trying to understand our alternatives on this point, because then there's the matter of like, okay, we've received funding from development, but then that's why I appreciated Council Member Juarez's point saying, well, will this 18% increase then dissuade further development and becomes a self-fulfilling prophecy?

And I think that's what we're trying to avoid.

So I'm just trying to understand our alternatives here, a full slate of all the alternatives.

And so if there's anything that hasn't been spoken to, I don't know who this is a question to everyone, but I'd like to understand what all of our alternatives may be in this situation.

I might jump in here and maybe I'll take a run at it and just because I got really involved last year.

You're not gonna mansplain are you?

No, I'm gonna ask questions.

Okay, good.

Which is, Council Member Rink, you're asking what are the levers that we have right now?

We can either fire staff, we can either raise the permit fee.

Are there any others?

You could theoretically add general fund.

We could add general fund and that would increase the structural deficit or decrease the structural deficit?

Increase.

Increase the structural deficit.

Are there any other levers?

The only other levers that I'm thinking of are the ones that Director Lee already mentioned, investments and changes in policy, the PACT efforts to simplify and make permits faster, also the AI investment, hopefully establishing clearer expectations so that people can move more quickly through with fewer reviews.

Good, good.

How'd I do, Council Member Waters?

Great, now I see what you're saying.

I'll take back the jab.

I got one back today.

I'm appreciating Dr. Lee's poker face.

I don't want to play poker with Mr. Director Lee.

Back to you, Council Member Rink.

Thank you for letting me jump in.

I appreciate the assistance, Chair.

And just as a follow-up to this point, understanding increasing general fund and understanding the increase to the structural deficit, do we know by what amount it would increase it by at this time?

I'm sorry, what amount, like the amount of revenue that we would get from this?

I believe it's around nine million.

So I think it's roughly, yeah, it's about nine million.

You know, just to calculate, nine million dollars would equate to 60 positions at $150,000 a position.

So that's...

Understood.

Thank you.

Thank you.

Thank you, colleagues, for letting me unpack that.

I just wanted to have a better understanding of our options on the table and the predicament we are finding ourselves in.

And building on that point, can you touch on your core staffing reserve and how it's looking like in the coming years?

Yeah, right now we have, of course, so what you see here is an overall fund balance.

The blue and the green, the blue is the building fund.

core staffing and the land use core staffing is in green.

So we have core staffing for the cyclical cost centers that we track, building permits, land use, which is master use permits, site review and site development, and electrical, because those are all cyclical, and those are what are most affected in a downturn economically, in a recession.

and so those are the groups that we have the core staffing for.

And so right now, um, electrical's okay and site review and development is okay.

They're not dipping into the, uh, core staffing reserves, but building and land use are definitely.

Land use is over halfway into their reserve of about 7 million and, um, the building we're projected to be, they have about $21 million in the building permit core staffing reserve.

And by the end of the year, we're thinking it's gonna be somewhere, but we're gonna eat into that somewhere between maybe seven to nine million.

I mean, that's just an estimate.

So the 18% is to help slow that down.

And hopefully we'll see some recovery in the economy interest rates come down and people start building again.

I think we're all hoping for recovery in the economy.

I'm going to shift gears a little bit to take a moment to clarify some points and draw a little bit of a connection between previous presentations because I know my colleagues, Councilmember Saka, Councilmember Salomon and I have asked a couple of questions of other departments related to tenancy services, so I want to take a moment to Bring some clarification to the record and also ask a question of the department.

So the proposed budget maintains our current levels for tenant services as we've discussed.

These services were cut by 40% or around a million last year but have been maintained since then.

and I wanted to raise this point because it's my understanding that this contract actually lives within SDCI, not HSD, and wanted to chat about that but also take a moment to explain for the record, since there's been some confusion between rental assistance and tenant services, rental assistance is exactly what it sounds like helping individuals who are struggling to pay rent.

to ensure that they can cover that cost in time.

But tenant services is a far broader category which includes right to legal counsel during eviction proceedings, legal clinics for individualized support to prevent eviction in the first place, as well as guidance and counseling on how to deal with common issues facing renters like conflict mediation, payment negotiation and debt defense.

So that was also learning for me and I thought it might benefit the body since it's come up in a few different presentations.

And understanding that this contract is administered by SDCI, I wanted to bring to this discussion and also open it up to ask the department, is there anything you can share with the body about the work and tenant services and any history here?

Sure, happy to.

And actually for this, I might bring up our Code Compliance Director, Jeff Tallent, who has a lot more background on this.

Jeff, you're adding to Council Member Rink's counted time.

Hurry, hurry.

Any chair and any microphone, just jump right on in.

Good afternoon, Jeff Tallent, SDCI Code Compliance Director.

So I guess the question was clarifying these different funding sources.

So yes, SDCI holds tenant services funding for exactly the purposes you talked about, eviction, defense, education, outreach, some case work and support, answering questions, staffing hotlines for tenant services.

We also got a one-time appropriation of rent assistance tied to eviction defense two years in a row.

So we were part of the rent assistance puzzle there for a couple of years.

And those funds were intended to bring that to the eviction defense attorney so they could bring money to the table in an eviction case and head it off when that was appropriate.

That was transferred to HSD this year The funding was, we're actually administering it for them through a continuation of our existing contracts, but it is HSD funding.

And then, excuse me, for 2026, the proposed budget takes that and expands it even more to, I think, $4 million in HSD for an expansion of emergency rental assistance, which will include that eviction defense-related rental assistance and other purposes.

Thank you for that.

Thank you for that clarification.

I know there's been a lot of curiosity about the program, so since you were here today, I wanted to bring it up.

And on a final point, I know my colleague Councilmember Kettle asked a program about AI and if I'm understanding the intention of the department correctly, and please correct me if I'm wrong, it sounds like the intention of this investment is to help in speeding up our existing processes, makes for some more efficiencies.

I hope it's not coming at the expense of workers and replacing roles.

Is there anything you want to expand on on that point?

No, that's absolutely correct.

And so the tools that we're looking at really is to help strengthen applicant permits as they're coming in so that they're more complete, have less mistakes.

And so when our reviewers are actually taking a look at them, they're not having to have as much back and forth with the applicants for minor corrections or paperwork they may have missed, something that they could have just submitted on the front end through the identification that the AI software would be able to help with.

So it does not take any humans out of that loop.

Understood.

Are we learning from any other jurisdictions on how they're deploying AI in permit review?

Yes, we are.

This is a new, I mean, it's a new technology, so there aren't a whole lot of jurisdictions that are doing this.

We are innovative in that sense.

But we have been working with jurisdictions like Denver and Honolulu.

There are a couple of cities that have started, that have really embraced this technology.

But we are being very cautious about how we're about our investments.

And we want to make sure that whatever money we put into this technology, that it's technology that actually will help as opposed to just something that we could just implement and just have.

We want to be able to see the return on investment.

Understood.

Thank you.

I think one issue that could unite the whole city is getting a permit turnaround at a faster time.

So thank you all for your work and for the time today.

Thank you, Chair.

Thank you.

Councilmember Rivera.

Thank you, Chair, and thank you for being here.

And I'll add my voice to the gratitude directly for just jumping in and doing the job, holding the seat for someone else.

I am always really appreciative that people will just jump in and say, yes, I'll do it.

I'll do what I need to do.

So I appreciate it.

I know the constituents really appreciate that, too.

So thank you.

You have a hard job.

My question is on the fee increases, well, my colleague, Council Member Juarez, started the conversation, Director Noble weighed in to all the things that feed into why things are not currently getting built.

So right now it seems and it sounds like we're doing well on our permitting if projects start to pick up again.

My question is then, will we have do you think the capacity to be able to continue to do the permitting in a way that's not gonna cause delays in the way that we've seen in the past because we know the permitting delays are the issue if we're gonna increase fees.

I just wanna make sure that it's going to the service being better or making sure we are not, it's not gonna lead to delays later if the projects kick up, that kind of thing.

Yes, and that is the purpose of this fee increases and make sure that we are creating a buffer for that.

We want to make sure that when the permit fees do start picking up, sorry, permit applications start picking up that we have the staffing levels and the expertise to be able to continue to move permits through as quickly as possible.

Thank you, because I know that that is what the waiting around for the permitting is what causes a lot of the increase in the projects because then in the meantime, things increase in price, materials, labor, all of it.

So I understand there's a lot of forces going into it.

My other question is, sorry, With the permitting exemptions, can you just tell me, and I do not know how this works, so if we've created more exemptions from permitting to try to help projects along faster, and I'm wondering when that happens, do the developers, do they, do they not, are they consulting with SDCI at all on whether they need the permit or not or how does that work?

So there's a number of different ways that developers come into the city and it depends on also their level of, sophistication is probably the wrong word, but just the amount of experience they've had with the city.

and so one of the things actually we are looking at is what is the front door of SCCI because there are a number of different ways that they can come in and depending on the way they come in, it also takes them into different directions and could lead to a misunderstanding around what type of permits they need or what they don't need.

That's something that we are certainly taking a look at, especially through PACT.

I'm sorry, I'm trying to remember the original question you had, which is,

So if I'm a developer and I'm going to develop a project, even if I think I might qualify for an exemption of a permit, do I just go off and do my project and don't consult with you all, or do I still have to consult with you and then you let me know, no, you actually don't need that permit, you're good to go, or do you sign off on that type of thing?

Because what I'm getting to is, do I still need to go through SDCI to get a sign-off on you don't need the permit, because that still requires someone at SDCI to help that developer with that project, even if we don't need to review it for giving of the permit.

So that's a great question.

Actually, so the permits that are not needed for certain projects are land use permits.

All projects still need, and correct me if I'm wrong, All permits still need a building permit to go through to be able to construct.

And so even if they don't need a MUP, which our intake folks can easily explain that to an applicant.

And most, I would say, frequent flyers, if you will, understand what the regulations are at this point.

So they'll usually know at this point that if their projects need a MUP or not, and then they can go straight to building permit at that point.

So it's typically not an issue, but we do have a team that helps applicants sort that out when they come into the front door.

So you still need that capacity even if we're exempting some permits.

That's true, yes.

Yeah, so you will need folks.

And so that also warrants the increase in fees because you need the people there to even do that.

Correct.

Yeah, thank you.

Thank you, Chair.

Thank you, Council Member Rivera.

And put myself down.

Got the last set of questions.

Colleagues, if you've got other questions, put your hand up now so I can know to manage my time a little bit better because I want to keep digging into the core staffing.

And so I want to just reframe from where we were a minute ago.

We are seeing less revenue.

So I'll restate from the very beginning.

All of our permitting staff are funded by our enterprise fund, which are fees recovered from permit applications, correct?

if we could verbalize just because the camera's not on you as well.

Yes.

Thank you very much.

And those funds are reducing because the number of permits have gone down as well as the streamlining of state policy, correct?

It's actually the number of...

You look at the more complex projects that bring in more funding.

So if you'll look at...

Can you go back to...

Don't forget to Mick Jagger the microphone, because we're having trouble hearing you.

If you look at this slide over here, you can see the permit volume actually is increasing a little bit.

Right.

And so it's not that it's the, that permits are, the numbers are decreasing, it's the type of projects that are decreasing, and that's really what's affecting the amount of money that's coming in.

So you're telling me that we should get Deborah Waters to build another Climate Pledge Arena?

And so we are having more small projects, fewer larger projects.

We have sound transit on the horizon.

Their permits are starting to come in.

We're aware of their bow wake.

But in this moment, we have fewer dollars coming into the enterprise fund than we have, we have fewer dollars than the total amount of money that we need to pay our staff.

Is that a fair estimate?

And so when we have fewer dollars coming into the enterprise fund than we have expenditures for staff salary, that is when we use the core staffing reserve.

Is that correct?

Yes.

and so just as I pulled out last year because I'm that type of budget chair where I've got last year's budget and this year's budget underneath this dais.

Last year's was page 710 for your planning reserves core staffing.

In 2023 your core staffing was at 38,381,000, is that correct?

Yeah, it is, yes.

So you had $38 million in 23 in your core staffing.

In 24, that dropped to $22,000.

So you were burning $16 million a year.

Are you looking at the six-year financial plan?

I'm looking at your construction inspections fund, 48100, under your planning reserves core staffing.

Yeah, this might be easier to explain in a written response, but the...

So let me let me help you with where I'm going.

I know that report and it shows the Okay, that's okay, I know what it is.

Yeah, so that financial plan, it assumes the reserves that we have are commitments, are commitments already made, which is something funny with that version of that report.

We have these reserves still.

You're jumping ahead of where I'm going.

I'm just asking you one question at a time.

Let me get where I'm going.

Take a little heat off your shoulders here.

Between 23 and 24, we went from having 38 million to 22 million, which was a burn rate of about 16 million.

Is that right?

Yeah.

and then moving into the 2024, and this is last year's projections, in 24 and 25 we had a planning reserve of 22 million dropping to 18 and then 15 and 26, 27, 15 and 28. That was last year's projections, right?

and from there, that was the hard decision to lay off staff, which is a very hard decision.

Each of those people has a family, has commitments to themselves and others.

I'm not putting this on you, I'm putting this on me because I passed the budget, you didn't.

That was really challenging for me.

But I put this in that you had a burn rate of $16 million a year, In this year's budget, we had a planning reserve planned at $18 million in core staffing, but now I'm seeing in the 26 revised that it's down to 12. So we're actually burning more than even anticipated last year, is that correct?

We are.

And so in the 27 and 28 projected, I'm seeing only $7 million in the planning reserves for core staffing.

Yeah, so in this chart here, you can see the reserves, the core staffing reserves, the blue and the green.

Yeah.

They're basically disappearing.

That's without a fee increase.

With the fee increase, it slows down the burn, but they are still going down.

Yes.

So that's why, you know, to fully recover, it would be 35%, but that's a lot.

So we were just going to do half this year, 18%.

And other ways to increase the amount of revenue that we're receiving is if we started having these large, more complex projects.

Yeah, you know, during the boom that we had that lasted roughly 10 years from the last Great Recession until the early 20s, the city built up a lot.

There are a lot of large cranes in the sky.

There are a lot of large buildings coming up.

Those buildings are complex.

They're big.

They require a lot of work.

They bring in a lot of revenue.

And we built up our fund balance during that time.

I think it got pretty high.

I know Ben had concerns about it at one time being a little high.

But it can change very quickly when the economy changes.

Our burn rate can really increase quickly.

And that's the point that I'm trying to illustrate here with my line of questioning.

I wasn't actually going in on you.

Which is just to say that After 2008 recession, we as the city, I wasn't here as an elected official or as staff, we as the city made the decision to lay off a large number of permit reviewers, which took away our institutional knowledge from being able to process permits so that when the economy clicked back on, we were behind the curve in a very significant fashion.

And so this managing of this core staffing reserve has been essential for us to not find ourselves in the same place even though we are now five years into, six years into buildings.

We went from the fastest growing city in the nation to were not decreasing, but we don't have as many cranes in the sky as we did.

And this is really something that is driving our structural budget challenge across the board, colleagues, because of the lack of property tax plus one, or 1% plus new construction property tax, the sales tax, et cetera.

But I'm pulling these numbers out of the back of the book to illustrate why we had to make such difficult decisions last year regarding staffing.

I appreciate Council Member Waters' perspective about what real impact does this have on especially nonprofits, but none of these decisions are being made lightly.

and colleagues, if you need to see what the skyline looked like before the year 2000, go back and watch 10 Things I Hate About You.

It looked completely different.

I mean, really, our city has changed so immeasurably in 26 years.

With that, just want to check in, earlier this year I worked on legislation to ban algorithmic rent price fixing.

Do you all have those resources?

We requested a report within there.

Are you feeling comfortable like you're able to produce that report?

I just don't want to give you unfunded mandates.

Are you familiar with this?

Yeah.

So there were a couple of expectations there.

One was to help get the word out to the landlord community, and we did that in our, we have a listserv that goes to 20, 25,000 landlords and property managers.

So we helped get that out, put it on our website, built it into our landlord training curriculum to help get the word out.

and then yes, we have a report.

We know we're tracking it.

We have only sort of just begun, but I believe it is a fairly manageable report and we'll be able to get it to you by the end of the year when it's due, so.

Thank you.

And I see Council Member Kettle's got his additional hand.

Just reminding the body, we're almost out of here.

Thank you, Chair Strauss.

I just have to ask a question and this could be for Director Eder.

One of the things last year is like right-sizing with departments.

This is the Seattle Department of Construction and Inspection.

and when it comes to rental housing, it makes sense to be there for construction and inspection to make sure that it's safe, that it's for the residents in the building.

But rental assistance and the legal piece and all these other elements belonged in the Human Services Department.

So today we hear that the money had been shifted to HSD but in reality nothing's changed because the people who are doing the work are gonna still reside in SDCI.

Is there a move to eventually get those people to HSD where the money is?

I am not able to answer the question on the fly here.

I know that the money is added in HSD.

I think most of the money is going out to help people who are struggling with paying rent.

They have late payments or they have a built-up balance.

So I think most of the money goes out to pay rent.

and the people who are overseeing that process, are they residing in HSD or SDCI?

That's what I don't know offhand.

I thought they were at HSD, but perhaps they're...

So on rent assistance, SDCI only got a small piece of the puzzle, only for two years.

And we didn't staff up, we just used our current grant program administrator to just add those to that workload for those two years.

It's now back at SDCI, where it was part of a bigger program, I mean, back at HSD.

I don't know if there are full numbers, but I think it was something like $6 million total in rent assistance, plus the mayor's ads this year.

So that body of work is with HSD, including the people.

Granted, most of the money is going out.

It's not like I understand your point.

I believe we have something more like 11 and a half million dollars for rental assistance.

And I think that work is being overseen at HSD.

Okay, because the way that was presented earlier, it seemed like it was like a pass-through, so I just wanted to double-check.

Yeah, the clarification would be just for this year, when that money got transferred to HSD, they didn't have time to pick it up and run with it, so we just entered into an agreement with them to administer their contracts, excuse me, for one more year, but it's all fully going to HSD starting in 2026.

kind of a pass down, if you will.

Okay.

All right.

Well, that's clear, because the way it was said earlier, I was like, okay.

Thank you, Chair.

I just want a clarification on that.

I got it.

We're all good.

Thank you, Council Member Kettle.

Just want to know, so SDCI closing comments, seriously, Director Lee, such a darn pleasure to get to work with you.

Thank you for taking the helm in this moment and we're looking forward to meeting Brooke when she gets here.

But any closing comments from your team?

No, I don't.

Thank you so much for your time.

I really appreciate it.

And we will follow up with any questions that we weren't able to answer today.

Fantastic.

Yeah, thank you.

Thank you so much.

and just a final thank you to all of your inspectors who are out there in the field having tough conversations with people who are oftentimes not happy doing the city's work to make sure that the buildings are built correctly, safely, and will be here for the longevity because back to my editorial about the 60s and 70s, horrible design.

Thank you to all of your staff.

Colleagues, this does conclude our September 30th, 2025 Robert's birthday committee meeting.

Just looking at next week, again, we have a Tuesday public hearing virtual session at 1 p.m., in-person session at 5 p.m., and a Wednesday meeting regarding the 0.1% public safety sales tax.

So that's what's on deck for next week.

Again, please meet with your stakeholders.

to continue developing your budget proposals.

Director Eder, Director Noble, any final remarks before we close the first section of this budget process?

No, I just want to thank you for your attention and focused efforts reviewing the budget and considering the final version that you will ultimately pass.

Thank you so much.

And just to note, Council Member Salomon and Council Member Juarez tied for most focused questions, but Council Member Juarez was smartly got me and Council President Nelson to ask some of her questions.

The winner goes to Council Member Solomon.

Thank you all.

If there's no further business before the committee, it will be adjourned.

Council Member Solomon.

I want to thank you for your service.

I also want to give a shout out to the SDCI staff.

I've worked really closely with the code enforcement folks, with the vacant building folks, and in my previous role doing crime prevention in the south end.

A lot of the success that we had in addressing community concerns is because of the partnership that I've had with folks like Elliot and Hinch and Liz and all those folks and just wanted to shout that out.

And finally, Happy birthday, Papa Strauss.

Thank you, Councilmember Salomon.

Thank you all.

Seeing no further business to come before the committee, we are adjourned.

See you next week.