Seattle City Council Select Budget Committee Session I 6/24/20

This is the meeting of the Seattle City Council Select Budget Committee.

The committee will come to order.

Will the clerk please call the roll?

Councilmember Sawant?

Here.

Councilmember Strauss?

Present.

Councilmember Gonzales?

Here.

Councilmember Herbold?

Here.

Councilmember Juarez?

Here.

Council Member Lewis.

Present.

Council Member Morales.

Here.

Council Member Peterson.

Chair Mosqueda.

Present.

Eight present.

Thank you, Madam Clerk.

Colleagues, I want to thank you for your time today.

As you know, the select budget committee meetings have two sessions.

This is the first of two sessions starting today at 10am and the second session will start at 2pm today.

Session one this morning is devoted to the conversation about progressive revenue and session two is devoted to the Seattle Police Department's budget inquest and the mayor's proposed 2020 rebalancing budget.

Today's conversation in the morning really builds on the conversation we began months ago about progressive revenue and our engagement as a city to make sure that we are responding to the crisis that is COVID, creating immediate relief and support, and building the economy that we all want to see that will be more equitable and stable in the out years.

We know for many across the city and across the state that there is a call to action.

We've heard for years, decades, that we must do something to right-side up this upside-down tax system in the city that we live in and in the state where we live.

We know low-income families are paying six times more than their share of income in taxes and wealth, and the wealthiest households are paying the lease percentage wise.

This prevents us from investing in things that we care about, things that we need right now, support for housing and food assistance, support for childcare and education, and support for investments in housing and homelessness services that have been declared a crisis.

We want to make sure that we continue the push at the state level for progressive revenue.

And as we work on that state solution, we must not lose sight of the fact that we can act here in our city.

We do not have to make impossible decisions with an austerity budget only approach to choose between whether or not families have access to childcare, or kiddos have a roof over their head, or families have food on their table, or whether we're investing in opportunity on the horizon.

We have the opportunity to invest in making sure that our families have what they need and not just an austerity budget that presents itself when we build in revenue.

The inequities that we have seen throughout our city and our country have only been exacerbated by COVID.

Make no mistake, they've been here for decades.

And what we're trying to do right now is invest in that crisis that COVID is presenting and also invest in the crisis that has been exposed by COVID throughout the years.

We can leave the nation in responding to the crisis that is homelessness and housing, in responding to the COVID crisis.

We can leave the nation when we have progressive revenue in hand to allow people to keep roofs over their head and put food on the table.

We know that food insecurity was here long before COVID.

We know that displacement and gentrification were here prior to COVID.

We know that we had the third highest rate of homelessness in the city prior to COVID.

And now we can actually see the crisis that was presenting itself by the years of disinvestment in public health.

So we have an opportunity and more importantly, we have an obligation to step up and create a budget that reflects the values that our city needs and revenue to help plug those budget holes, reinvest in the community that's been long put on the back burner, and make sure that we're investing in a more equitable community on the horizon.

I look forward to the conversation that we're having today, not just this morning and this afternoon, but over the next few weeks as we talk about how we can build into our city council's response to the mayor's proposed budget, what we would like to see in response to this COVID crisis and in the out years beginning to invest through progressive revenue and housing and homelessness services, investments for small businesses, child care and working families, and making sure that our smallest businesses, our most vulnerable communities have the supports that they need.

Today's budget agenda reflects that comprehensive conversation, again, with the morning part one focusing on progressive revenue and part two this afternoon focusing on the mayor's proposed budget and the Seattle Police Department's budget and an inquest into the budget that they have.

So with that, that's an overview of today's proposed agenda from the morning to the afternoon.

I will make sure that we get you at least an hour break between the meetings and we are going to have plenty of time for robust conversation and public comment.

With that, that's an overview of today's proposed agenda.

If there's no objection to today's agenda, the agenda will be adopted.

Hearing no objection, the agenda is adopted.

At this time, we're going to open the remote public comment period.

I ask everyone to please be patient as we continue to operate the system in real time and navigate through the process that is participating remotely so that everybody gets a chance to speak.

It remains the city council's strong interest to have public comment regularly at our meetings.

We will continue to resolve issues as they come up.

And we also want to make sure that we have a robust discussion.

So we are limiting folks today to one minute.

We will have the chance to have people speak at 2 p.m.

again today if you did not get a chance to speak this morning.

The public comment period is going to be for 30 minutes and each person will be given one minute.

I will call on the speakers one at a time and in the order in which they've registered on today's council website with an emphasis on trying to make sure that we hear from as many people as possible.

If you have not yet registered to speak and would like to, you can sign up before the end of the public comment period by going to the council's website.

The public comment link is on today's agenda.

Once I call the speaker's name, the staff will unmute the appropriate microphone and automatically prompt you so that you know you're unmuted.

Please begin speaking by introducing your name and talking about the item that you are here to address.

As a reminder, public comment should relate to the items on today's agenda.

We are also interested in hearing from Seattle residents as we are opening up the discussion today.

Please know that you will hear a 10-second timer when your allotted time is going to be cut off.

We want you to conclude your comments so you don't have your microphone abruptly ended.

Note that you'll have about 10 seconds to wrap up your thoughts.

Once you complete your public comment, we ask you to disconnect from the line, and if you plan to continue following this meeting, please do so via the Seattle Channel or the other listening options on the agenda.

The public comment period is now open, and we will begin with three speakers.

Let's just make sure we do a quick audio check.

Okay, great.

I no longer hear a echo.

So the first three speakers are Alex Cooley, Shoshana Weinberg, and Kelly Larson.

Alex, welcome.

Hello, council members confirming I can be heard?

You can, thank you.

Wonderful.

Thank you so much for allowing me the opportunity to speak.

My name is Alex Cooley.

I'm a resident in the third district and I work in the second district.

I'm speaking in regards to the quote unquote tax Amazon proposal.

I do want to say I am very much for a progressive taxing system to appropriately fund our city.

That being said, I do not believe that this proposal is that.

I believe it is denies businesses in a propagandist way, making it seem as if this is explicitly against Amazon, who should pay and invest more into the city, but as a partner, this proposal includes so many other businesses, specifically hospitals that are having an incredibly difficult time right now.

In addition to, I think the city has clearly spoken, that there are other concerns associated with the budget, specifically police funding.

I would encourage the council to look at this from that perspective of.

Thank you very much for your comments.

Kelly Larson.

Welcome.

And I work for Plymouth Housing.

Hi, my name is Kelly Larson and I work for Plymouth Housing.

I'm speaking on the progressive revenue item.

Plymouth serves over 1100 people in supportive housing every year in Seattle.

The average income of our residents is 11 percent of area median income.

Most of our residents live on government-subsidized disability income or are working toward it and will require deeply affordable housing for the rest of their lives.

We serve the most vulnerable and low-income residents of our city, people living without homes for long periods of time, people living with disabilities.

The majority of our residents are people of color.

Third Door Coalition projects the need of 6,500 apartments like Plymouth provides to meet the need.

Plymouth has projects breaking ground next year that have no source of funding for operating and services in the long term.

This is the revenue we need to continue growing and providing new homes to people in need.

We support the jumpstart spending plan focused on zero to 30% AMI housing for those who are most in need in our community.

We also support the investments in EDI and COVID relief efforts.

Thank you for your leadership Council Member Mosqueda and all council members and staff who've worked over the years to get us to this point.

We look forward to engaging in this work as it progresses.

Thank you so much.

Shoshana Weinberg.

Welcome.

Good morning.

My name is Shoshana Weinberg and I'm testifying on behalf of Youth Care.

We are the largest agency serving youth and young adults experiencing homelessness in Seattle and we are in strong support of Council Member Muscata's progressive jumpstart proposal.

Youth Care supports this proposal because it is rooted in equity.

It seeks to disrupt a racist and untenable status quo through a modest reallocation of wealth and a critical investment in affordable housing.

for those who are at the lowest incomes and who are disproportionately black and brown.

Affordable housing is particularly important for the youth that youth care serves, two-thirds of whom are youth of color, because they experience additional housing barriers due to their age and lack of employment, credit, and rental histories.

Advocates have long argued that homelessness represents a housing crisis, a public health crisis, a social justice crisis, and a moral crisis.

We need a moral response, and we believe this is a critical step forward.

We urge your support.

Thank you.

Thank you so much, Shoshana.

The next three are Katie Simpson, Gee Laster, and Daniel Swanson.

Welcome, Katie.

My name is Kate Simpson, and I'm a resident of Capitol Hill.

I urge the council to support the Sumant Morales tax Amazon legislation over watered-down alternatives.

Tax Amazon would raise more than twice the amount of money than the Democrats' Amazon tax with no sunset clause.

We need that 500 million a year to fund COVID relief, social housing, and the Green New Deal.

I would also like to voice my support again for defunding the SPD by at least 50% and investing in community and restorative justice.

Thank you.

I yield my time.

Thank you, Kate.

Gee Laster, welcome.

Hi there.

Can you hear me?

Yes.

Thank you.

Can I be heard?

Okay, perfect.

I'm calling as a white non-binary resident of District 7 in support of the Swamp Morales tax Amazon legislation.

As was said at the beginning of this meeting, progressive tax structure is super necessary for funding many, many important organizations for giving people the relief that they need, especially given that the CARES Act will be ending very soon, leaving a lot of people.

in dire need.

I don't feel that $170 million is enough.

The scale of this problem is large.

It is not time for modest tax restructuring, as someone previously mentioned.

Please support this without the watered down aspect of the other tax amendment.

I would also like to support defunding the Seattle Police Department by 50%, though I do not have faith in this council that they will do that.

Thank you.

Thank you so much.

Moving on, as folks know, we are going in the order in which the council's website was used to sign up with priority for Seattle residents.

Appreciate you all calling in.

Daniel Swanson, Steven Ramos, and Jessica Skoslow.

Daniel, welcome.

Hi my name is Daniel and I'm a rentering worker in District 4. I'm calling today in support of the Salant Morales Amazon Tax.

As an active volunteer with the Tax Amazon campaign I can speak to the overwhelming support in our communities over the idea of progressive taxation.

Every shift I've engaged in political conversations with community members over the necessity of creating affordable housing options in neighborhoods that historically belonged to Black and POC communities that have been forced out through racist racist gentrification.

And none of these conversations to community members raised the need for a sunset clause on affordable housing, and none of these conversations to community members raised the concern that $500 million is more money than we need to build these homes.

Obviously, the tax Amazon movement has put pressure on the council regarding taxation revenue as evidenced by the Muscata and Lewis bills.

Why, though, would we shoot for less when the communities that would benefit are clearly demanding more?

We need solidarity over the strongest proposal, and that is the Swamp Morales legislation.

I also support defunding the police by at least 50%.

I think that Council Member Morales' tweet yesterday at Beyonce rolling her eyes at Jenny Durkan's proposed 5% cut to the police budget is a sentiment that I'd like to see all council members adopt.

Thank you.

Steven Ramos.

Hello.

Thank you.

I'm here to speak up in support of the Suwant Morales Amazon PAC legislation.

I'd also like to note that I'm a white transgender essential worker here in Seattle.

Our city has a massive problem with affordable housing and corrupt business practices.

Jeff Bezos and other business owners like him fund themselves through exploitive business practices and loopholes while their employees are being subjected to mistreatment and abuse while they're upkeeping commercial demand and addiction they've created by exploiting and manipulating the needs of differently abled persons and people affected by the pandemic.

If we are going to tackle racism in our community we need to disassemble these practices that disproportionately affect Black and Brown people.

We also need to tax Amazon and their peers for the money that our people are due and defund the police to fund our city and rescind the repeat sorry repay the people of Seattle for the abuse they've been put through.

Thank you for letting me speak today.

Thank you for your time.

And then we have Jessica Skoslow.

Welcome Jessica.

Hello, thank you for the opportunity to speak.

My name is Jessica Scalzo.

I happily live in District 3, and I'm calling to encourage the council to pass the original Amazon tax legislation written by Council Member Sawant and Council Member Morales without watering it down because it meets the depth and breadth of the city's needs.

I am concerned about another business tax being introduced, but I do think that shows the power of the movement for a big business tax in Seattle We need the original tax because it has Green New Deal provisions to also address the environmental crisis.

And I don't want a sunset clause because homelessness is not a fluke of the moment.

It is a result of a system that allows a few to amass a profit at the expense of the many.

And we won't solve this problem without deep systemic change.

I've been gathering signatures.

I know people are excited about this because I've been talking to them.

So let's do it.

And also let's defund SPD and give the funds to Black and Brown community restorative justice programs.

Thank you.

Thank you so much.

Katie Jones, followed by Rebecca Finks and David Van Winkle.

Katie, welcome.

Hey, Katie, can you hear us?

Katie.

I'm sorry.

Yes.

Good morning council members.

My name is Katie Joanna and I am a 20 year Seattle resident and business owner.

I support the Swamp Morales proposal.

Mayor Durkin is clearly not listening to the people of Seattle.

She has dragged her feet on getting the budget to you and then proposed fractional cuts to SPD which are insulting to all of our intelligence.

Why are you allowing Durkin to tarnish the reputation of the city?

We don't need to reinvent the wheel.

There are plenty of organizations in the community that know how to meet the needs of reducing crime and providing crisis assistance and equity.

So in the housing, youth care, YMCA Corps, New Beginnings, ask the people who are doing the work for the solution.

I've owned a business in Seattle for 12 years.

I'm a member of the Metro Chamber, and I've spoken with their policy team as well.

I have a location of my business in the CHOP, and I fully support the protesters.

This temporary discomfort is leading our city to meaningful change if you don't let it slip away.

Task big businesses like Amazon that keep getting richer while the poor keep getting poorer.

Get Durkin out of the way and cut SPD by 50%.

We cannot afford to keep waiting.

Do the right thing and hold people accountable.

Thank you so much.

Rebecca, welcome.

Hello, I am Becca Finkes.

I work for Lehigh with the Tiny House Program.

Thank you, council members, for bringing forth progressive tax proposals.

Lehigh supports these proposals to generate much-needed revenue to invest in expanding affordable housing and homelessness services.

Please allocate funding from progressive revenue, COVID-19 relief, and SPD towards tiny house villages.

We have a detailed funding proposal for the expansion of villages over the next two years and many potential sites.

We are also interested in improving services offered at existing villages.

We need an additional 156,000 to provide daily meals at each village in partnership with Operation Zach Lunch.

This is especially important for villages located in food insecure areas such as Georgetown Village and Camp Second Chance.

Thank you, council members for your leadership and time.

I'm excited to work together as we continue to lead the national response to homelessness through tiny house villages.

Thank you.

David Van Winkle welcome.

Hi.

Good morning council members.

My name is David Van Winkle.

I'm the project manager of DESC's Lion Building.

I've worked at DESC for about two and a half years.

We support the Jump Start Seattle initiative because it recognizes the reality that we at DESC have been facing while serving currently and formerly homeless adults in Seattle.

Since the beginning of the COVID pandemic, we've seen steep increases in our costs related to purchasing protective equipment and cleaning supplies and staffing ever-expanding workplaces to accommodate social distancing and providing hazard pay for as long as we can afford it, which we unfortunately no longer can, and in bringing food to our clients to help them shelter in place, just to name a few.

This plan addresses our community's immediate need.

and ongoing needs by funding permanent supportive housing, which we know to be the only proven solution to ending chronic homelessness, a condition that disproportionately impacts people of color and the LGBTQ community.

Thank you to Council Member Mosqueda for recognizing this and for creating this proposal.

Thank you to all of the council members who have co-sponsored it.

We appreciate you and your efforts in helping end homelessness in our community.

Thank you very much, David.

The next three are David Moser, Lee Hume, Samantha Thompson.

David Moser are you with us.

Yes I'm here.

Thank you.

Go ahead.

Hello.

Can you hear me.

Hi my name is David Moser.

I'm a resident of District 2 and I'm here to speak strongly in favor of Council Member Mosqueda's Jumpstart Seattle.

I'm a social worker and educator on homelessness and housing first at Seattle University.

I'm currently working as a behavioral health counselor in the COVID isolation and quarantine sites that King County has set up in response to the pandemic.

Every day at these sites, we are discharging chronically homeless people back to the streets because of the scarcity of permanent supportive housing in our region.

People come in, get a week in a hotel to rest in dry, humane conditions with a roof, locking doors and bathrooms.

And for many, they report feeling better and healthier after that week than they have felt in years on the streets and congregate shelters.

Then we kick them back out on the street.

Most of these people are Black Indigenous and people of color.

The only excuse for this in such a wealthy region as ours is systemic white supremacist complacency.

We know according to Third Door we need 6,500 units of permanent supportive housing in our region.

Enough with the false starts.

Let's get —.

Thank you so much.

Lee Hu.

Apologies for the last name.

Lee welcome.

Hi, give me one second.

Okay.

Hi, my name is Lee and I live in District 3. I'm calling in favor of Jump Start Seattle.

I'm a policy analyst at the Washington Low-Income Housing Alliance and a social work student.

In my four years as an emergency medicine researcher at Harborview, I found that many of the patients I saw who faced the most challenges had something in common, housing instability.

According to the Third Door Coalition, a year of permanent supportive housing costs the same as providing three days of treatment at Harborview.

Housing is health care, but the problem is that right now they're just owning their homes.

This is why I urge the community to approve Jump Start Seattle, which helps those who have been most impacted in Seattle by the economic effects of COVID.

With the bulk of funding going towards affordable housing for folks in the lowest income brackets and for assistance to immigrants and refugees who are excluded by the CARES Act.

Thank you.

Thank you.

Samantha Thompson, welcome.

Great.

My name is Samantha Thompson and I am a resident in District 6. I work at the West Seattle Food Bank on our eviction prevention and rents were already rising throughout Seattle for the last 10 to 15 years.

And what we saw after disasters like Hurricane Katrina is that rents increase and then there's even further displacement.

which means we'll lose communities here if we don't act swiftly.

And while I support the spend plan of the Jump Start program, I am concerned it doesn't address the immediacy and the urgency of the need to make sure that people do not lose their homes.

We know that eviction is the leading cause of homelessness.

And so in order to fully address and make sure that everyone can stay safely housed, at a time when it's more important to stay home and stay safe.

Support Morales' tax Amazon.

Thank you.

Thank you.

The next three people are Gabe Pelley, Hannah Swoboda, and Eva Mintz.

Gabe, welcome.

My name is Gabe Pelley.

I'm a resident of District 4 and a member of Socialist Alternative.

I want to speak to the homelessness and affordable housing crisis, which was declared a state of emergency in 2015, yet the council is taking over five years to act.

We now have to contend also with the pandemic and recession, so the city council must go beyond what's acceptable to big business and the capitalist class.

Firstly, by acknowledging that the for-profit housing market has been one of the most violent, destructive forces directed at working class and poor people in the city, through evictions, gentrification, and sweeps, we can't nickel and dime our way out of this.

we need to put serious money on the table.

Unfortunately, the Democrats' Amazon tax proposal would raise only $174 million per year, less than half of our $500 million Amazon tax, and be delayed until 2022. Secondly, it would build far fewer homes, only 2,300 compared to our 10,600 homes.

So I'm baffled why the homelessness service providers are arguing for this jumpstart Seattle proposal.

Third, the Sunset Clause must go.

Thank you, Gabe.

Hannah, welcome.

Hi, I'm calling in today to say that this new watered down Amazon tax proposal being put forward by City Council Democrats is wholly inadequate in its current form.

The fact that the City Council is now moving forward together on an Amazon tax is entirely due to the thousands who have been fighting for the taxed Amazon movement.

Our movement collected 20,000 signatures for a ballot initiative in 20 days.

It's because of this pressure that we're now being presented with this watered down big business concession that raises less than half of the funding that the movement is demanding and includes major corporate loopholes like a sunset clause.

It only proposes to raise funding for 3,200 homes rather than the 10,600 that the movement is demanding.

This totally falls short of what the community immediately needs.

There's an Amazon tax movement fighting for the strongest possible policy to raise $500 million per year to fund COVID relief, permanently affordable social housing, and the Green New Deal.

Our movement is made up of black and brown community members and leaders, community activists, rank-and-file union members, and socialists, including council members from our Socialist Council office.

Thank you.

Ava, welcome back.

Good morning.

Hi, my name is Eva Metz.

I'm a resident in District 2, and I wanted to speak in support of the Sawant Morales Amazon tax.

I think, yeah, if all these politicians are coming forward and saying that this is, you know, stuff we need to address the regressive tax structure, to address housing, why are they putting forward a proposal that only would fund a third of the homes, 3,200 homes versus 10,000 homes for the Swat Morales legislation.

Why introduce a sunset clause?

Why put forward a proposal that raises less than half of what we need?

Our movement has already gathered over 20,000 signatures to take our Amazon tax to the ballot, and we're prepared to do this if council fails to pass a strong Amazon tax, and we're prepared to continue to fight to win what we need.

So thank you.

The next three speakers are Hillary Coleman, Kate Rubin, and Kathy Yassi.

Hillary, welcome.

Hello, council members.

My name is Hillary Coleman, and I work at the Seattle-King County Coalition on Homelessness as our community project manager.

I live in District 4. I am calling today in strong support of the Jump Start Seattle legislation.

We've been in this declared state of emergency around homelessness since November 2015 and continue to see daily the need to significantly deepen our response to homelessness and to drastically increase the amount of affordable housing available to people with the lowest incomes in our city.

Jump Start Seattle prioritizes deeply affordable housing, including permanent supportive housing for people in Seattle with the lowest incomes.

For a single person that is earning below $23,250, or for a family of three earning below $29,900.

Those are the amounts that we mean when we talk about people who earn below 30% of AMI.

And I think it's really important to remind everyone having these conversations with the actual levels of income we're talking about and to prioritize that.

This deeply affordable housing is necessary to make sure that people can have a safe place to call home and must continue to be a priority as legislation evolves.

Please.

Thank you so much for calling in.

Hilary, we appreciate it.

Katie Rubin, welcome.

Hi, my name is Kate Rubin.

I'm with BC Seattle and I'm a resident of District 2. I'm calling in support of the Sawant Morales Tax Amazon legislation.

The alternative legislation does nothing to protect the middle earners, the majority of the working class people in this city.

Many of us who are really struggling to survive with paying rent, that is an average of nearly $2,000.

We have an ongoing homelessness crisis that is affecting black and brown community members disproportionately.

And the watered down legislation does very little to help the majority of the people who need it.

There is enough room in this city for everyone.

We all contribute to this community and we all need space.

Thank you.

Thank you.

Kathy Yazzie.

Hi, Kathy, are you with us?

Welcome.

Hi.

Yes.

Good morning.

I'm Kathy Yazzie, longtime resident of the Central District and a rank and file member of SEIU 925. I'm pleased that our city is exploring budget ideas that support families' jobs and affordable housing.

We must repair the damages done by decades of racist policies and gentrification.

It's critical that the largest corporations in Seattle pay their share.

We need a strong big business tax to address our city's history of housing and economic inequalities.

We need a city council that can stand up for us, the working people, and our interests.

Pass the $500 million a year big business tax without corporate loopholes and no sunset clause.

Build permanently affordable housing.

Create union jobs.

Thank you.

Thank you.

Juan Lucas Garcia followed by Brianna Nemi and then Naomi Woodruff.

Welcome, Juan.

Can you hear me?

Yes, we can.

Thank you.

Hi, my name is Juan Lopez and I'm calling in today to support all of the progressive revenue proposals.

As a volunteer at the Low Income Housing Institute and a constituent of District 4, I strongly support these proposals as they are critical for funding affordable housing, tiny house villages, and other services that aid our unhoused neighbors.

I also want to thank Councilmembers Morales, Sawant, Mosqueda, Gonzalez, Lewis, Herbold, and Strauss for the amazing work that you've all done in these progressive revenue proposals.

Finally, Council Member Peterson, I urge you to listen to your constituents and support the progressive revenue proposals.

Thank you.

I yield my time.

Thank you, Juan.

Brianna, welcome.

Good morning.

Members, my name is Brianna.

Good morning, council members.

My name is Brianna Nimi.

I live in Seattle and I'm a project manager of the mobile crisis team and I've worked at DEFC for five and a half years.

We support the Jump Start Seattle Progressive Payroll Tax and Spending Plan because it seeks to invest substantially in much needed affordable housing, specifically permanent support housing that is desperately needed in our community.

We need more units of permanent supportive housing to address chronic homelessness.

As I work in an outreach team for individuals experiencing homelessness, living with complex behavioral and physical health conditions, I can't stress how demoralizing it is to tell them that the reason that our community hasn't invested in affordable housing for as much as we need it to the scale we need it.

We see about 300 to 400 people a month, and the majority are seeking a safe place to sleep.

Our greatest challenges are finding shelters that are not safe, cannot accommodate families or folks with disabilities, or need a bed.

Affordable and permanent housing is the answer.

Please pass this plan to jumpstart Seattle.

Thank you for your time.

Thank you for your time.

The next three speakers, and probably our last three for today, or for this morning, will be Naomi Woodruff, Emily Katz, and Derek Lange.

Welcome Naomi.

Hello council members.

My name is Naomi Woodruff.

I'm an hourly wage contract worker here in Seattle.

You know I'm so over being taxed while big businesses in Seattle are not.

How can you call Washington Washington state's tax structure the most regressive yet want to cut corners with sunset clauses building fewer homes and overall bringing in less money to invest in the community.

I'm supporting the Swamp Morales Amazon tax legislation and I hope you will too.

To quote John Stewart, Black people have fought for equality while white people were building equity.

Now please redistribute some of that built equity to Black, Indigenous, and people of color with the Swamp Morales Amazon tax legislation.

Anything less is regressive, and I also would like the SPD to be defunded at least 50%.

The only sunset clause needed is on the regressive tax structure in Washington.

Please stop attempting to discredit the Swamp Morales as being regressive.

We need 500 million now, not less than half of that in two years.

Thank you very much for my time.

Okay, thank you.

Emily Katz.

Good morning, council members.

My name is Emily Katz.

I'm a registered nurse and the nursing manager at DESC where I've worked for about five years and I'm calling in favor of Jump Start Seattle.

To combat the spread of COVID-19, DESC worked quickly with our city and county partners to move our biggest congregate shelter into a hotel, and the success we've seen there has been remarkable, both in terms of preventing the spread of illness and in seeing the humanity and dignity that this improved space has given back to our shelter guests.

As a registered nurse for individuals experiencing homelessness and living with complex health conditions, I cannot stress enough how detrimental homelessness is to the health and stability of the people we provide care for.

Our shelter nurses and doctors are finally able to meaningfully address acute and chronic physical and behavioral health conditions and the thought of putting people back into a state of crisis where festering wounds and risk for loss of limb or even life take a backseat to everyday survival.

We're grateful that the Jump Start Seattle Plan seeks to aid us in our efforts to further decongregate spaces and to assist with the further prevention of homelessness in our community now and to build a permanent solution such as supportive housing into the future.

Thank you.

Thank you so much Emily.

Derek Lum.

Hi there city council members.

My name is Derek Lum here representing interim CDA supporting Jump Start Seattle as well as the other progressive revenue options that might be on the table.

Our mission is to promote equity and social justice for immigrant refugee low income and Asian Pacific Islander communities.

This plan for progressive revenue helps us accomplish this.

Our community has suffered greatly from COVID-19 and the related racism.

Our elders are high susceptible to the virus.

Our businesses saw massive drops in patrons, our residents have lost income, and many more things have happened.

Our community responded in many different ways, from COVID testing, to free groceries, to small business assistance, to murals and more, and this legislation will help amplify our community's efforts by investing more in immediate COVID-related assistance and in future investing in housing and business support in equitable way.

Thank you so much for this effort, and I appreciate everything the council has done.

Thank you.

Thank you very much.

Council colleagues, I really appreciate your time as we do public comment at the beginning of every meeting.

I think it's really important and something that I've heard from many council members that they think needs to happen.

So with that, we want to encourage folks who didn't get a chance to testify today to send in their public comment.

We also have the opportunity to testify again today at 2 p.m.

for that opens up at noon, if you can sign up for that.

We are continuing to work on our system so that there will be one sign-up sheet.

If that makes life easier in the future, we will do that.

I appreciate all of you for your time and for weighing in.

We know that there's a lot of conversations to happen, especially around the budget in the upcoming month.

With that, thank you so much.

Madam Clerk, will you please read into the record item number one?

Agenda item one, progressive revenue strategies for discussion.

Thank you so much.

Council colleagues, today we have a presentation from central staff members, including Dan Eater, Tom Mikesell, Ali Panucci, and Tracy Radscliffe.

I want to thank them for all of their time over the last few months.

We know that there's been an ongoing conversation about progressive revenue.

Thanks to council members Sawant and Morales for introducing their bills.

Those three bills are listed on today's agenda.

And per the conversations I've had with those co-sponsors, we will continue to list those items on the agenda every time that we meet to talk about progressive revenue.

We also have the three bills as introduced last Friday and then officially adopted on the introduction and referral calendar that are linked in today's agenda for our Select Budget Committee here.

We also have as an attachment the expenditure plan or the jumpstart spend plan that provides a little bit more of a narrative to that document.

That includes sort of an understanding of where those dollars would go, how many people would benefit, what types of situations we're looking to alleviate, And that document continues to be updated.

And it will also include more information about energy efficiency and Green New Deal investments as we move forward.

Just wanted to flag for you all of the work that central staff have been doing for us.

And I know that council members Morales and Sawant can attest to this from the first bills that they introduced.

That was 0.7% and raised about 300 million.

That was back in January, I believe.

I'm looking for head nods if they are showing their heads because Council Central staff have been really working on various proposals for a number of months and burning the midnight oil, working over the weekends.

And so just to want to just take a second to thank you for all of your time.

Central staff, as we know, we ask a lot and that the urgency is now and you have really, really delivered on an incredible amount of work.

So we thank you.

We also thank you in advance for your presentation today.

There's been a lot of questions that have been asked as we talk about looking at progressive revenue for the city of Seattle.

And we know that you've spent the last few weeks, and especially over the last week, going into detail on some of those questions.

So Council Colleagues, today is our opportunity to hear from central staff.

They are going to walk through various policy questions that have been asked already.

This is your chance to really flag questions, ideas, to do issue identification on the spot here, so we can start to hear where some of your ideas for possible amendments may lead to, with a reminder that amendments are due on Friday at 10 a.m.

To be respectful of our central staff's time, we are hoping that you can meet that deadline of 10 a.m.

on Friday.

Feel free today to identify possible things that you're looking into, even if they don't turn into amendments, just for the purpose of discussion, you're welcome to bring those up.

Really encourage folks to have that discussion here.

Again, I want to thank the co-sponsors of this legislation for your support for Jump Start Seattle.

And I also want to thank, again, Councilmembers Morales and Sawant for their proposal and for the conversations that we've had to agree to use the Jump Start proposal as the base legislation for the purposes of this discussion and possible amendments.

I really appreciate you guys agreeing to, or actually proposing to do that.

Thank you, Councilmember Sawant.

Because I think that this helps us streamline the discussion, allow for central staff to have a focus on where those amendments would go to.

And that does not take away from the progressive credentials of any of the proposals that you've put out.

That includes the ones from January.

I wanna reiterate that this entire topic today is on progressive revenue proposals.

I said it on Monday and I wanna say again how incredibly proud I am that we are working on a council that is pushing forward on progressive revenue proposals, so we do not end up in an austerity-only budget.

The proposed budget that we will talk about this afternoon does not include progressive revenue as a way to address the crisis that is COVID, as a way to create a more equitable economy as we recover from COVID, and it does not include the funding needed to address the historic inequities in housing, equitable development, and supports for small businesses.

So just want to lay the groundwork to say how important it is that we as a council, I think, are having this ongoing conversation around progressive revenue and the progressive credentials that are included in the proposals that we're talking about really do show that this council is committed to investing in a more equitable budget in this year and in the out years so that we can really put forward priorities, especially in black and brown communities that have been historically disinvested from.

And even as we have a conversation around progressive revenue, I think, you know, none of us are under the assumption that just this revenue alone will solve all of our community needs.

It complements, but it does not replace the conversations that we need to have about investing in black property ownership, in healthcare for all, in childcare for all, in housing that is affordable for everyone, especially for communities of color and low wage workers.

I'm really excited about this progressive revenue discussion that we have today and using today as sort of the foundation for what will come before council for us to consider again next week.

Thank you so much to the presenters.

We will turn it over to you to walk us through this.

And I want to note that there was an email sent around and perhaps central staff can comment on that.

I think that there was a revised presentation that was sent around that you should have received in your inbox as we began today's meeting.

For the viewing public, there is a presentation linked online, and we will also link that presentation at the close of today's presentation.

So I believe Patty sent around the revised presentation.

Again, as you hear questions or things come up as you're presenting, please raise your hand so I can physically see you like this.

I will keep my eye on the grid so I can see all of your faces.

And feel free to send me a message as well, because this will be the chance for us to intermittently throughout the presentation flag issues that you're looking into or questions that you might have for central staff.

Thanks again.

I know that Allie and Tracy, for example, have done a lot of work on the request that came from the discussion that we had about affordable housing and the number of units and trying to get a better sense of the yield that would come from investments that could be made through progressive revenue.

So thank you all for your time and the work that you've done on central staff and council colleagues.

Again, raise your hand or feel free to send me a message and I will queue people up.

Okay.

With that, I will turn it over to central staff.

I see Allie, you may have yourself off mute to kick us off.

I see Dan, you as well.

So thanks again, Allie, Tracy, Dan, and Tom for all of your time today.

And we got the presentation online.

Great, thank you, Chair Mosqueda.

I will kick us off today.

Today, we'll walk through a discussion of the proposed payroll tax packages.

This includes providing a comparison of the two proposals introduced to date, and then a discussion of policy considerations related to the Jumpstart Seattle proposal to inform the planned discussion of potential amendments next week.

In addition, for the spending plan, we'll walk through the results of some analysis we did to estimate the potential number of affordable housing units that could be supported from the Jump Start Seattle proposal.

Next slide, please.

The next two slides are provided for reference for today's discussion and for people who may review these materials without listening to this presentation.

The first slide provides a list of each council bill included in the two payroll tax packages.

As we walk through the presentation today, we'll refer to the different proposals by Council Bill number.

To all of you all and the listeners at home, any Council Bill number that is a 700 series is the package introduced by Council Member Swann and Council Member Morales in April.

And the 800 series relates to the Jump Start Seattle package that was introduced on Monday.

Next slide, please.

This slide defines several acronyms that are used on slides throughout the portion of the presentation focused on housing.

I'll do my best to avoid using the acronyms in my verbal presentation, but for future reference, and when I inadvertently slip back into the use of the alphabet soup, I've provided this slide for reference.

So I'll now provide a brief comparison of the two spending proposals.

This comparison is intended, as I said, to inform the discussion that Tracy will walk you through.

Allie, may I make a quick note for the viewing public?

Yeah.

I apologize.

When I said that there was a revised presentation sent around, that was the revised presentation for this afternoon.

Is that correct?

That is correct.

Okay.

Council colleagues, I'm sorry.

The revised presentation that Patty sent around this morning was for our agenda item number two for session two this afternoon.

So please continue to review the materials that were linked in today's agenda that Allie has up online as well for the viewing public.

This is the same presentation.

There has been no changes.

Apologies for the confusion on that.

Great.

Thank you for that clarification.

I wasn't certain.

I thought maybe some of my co-presenters had changed something.

So great.

Okay, so on the spending proposal slide, I'll now provide the comparison of the two proposals.

This is intended to inform the discussion that Tracy will walk you through in a few minutes on the different policy levers that can be pushed or pulled as it relates to the spending proposal.

I'm just going to highlight a few key differences between the two proposals.

One main difference is the two proposals.

In the two proposals, the amount of spending proposed for each package.

Council Bill 119-774 proposes to spend about $500 million annually based on the revenue estimates provided for the associated tax proposal.

Council Bill 119-811, which is the spending plan for the Jumpstart Seattle payroll tax, proposes to spend about $200 million annually.

I'll note here that later in the presentation, you'll hear from my colleague Tom, as he describes the proposed tax and refers to an estimate of about $173.5 million annually generated from that tax.

That is the revenue estimate central staff developed with the data available.

As noted on slide 17, due to data limitations, the estimate for the Jump Start Seattle tax does not include revenue that could be generated from businesses with payroll of $1 billion and above.

Tom can provide more detail on that estimate later in the presentation, but we just wanted to highlight that the spending plan uses the sponsor's revenue goal of $200 million rather than that estimate.

I'll also just briefly note here but the spending packages also differ in the following ways.

There are differences in the specific spending categories that are described in more detail on the next slide.

The source of funds for 2020 spending and amount of spending in 2020 also differ.

Council Bill 119-774 would spend about $200 million in 2020 on COVID relief, while the jumpstart proposal spends about $86 million on COVID relief, The 119774 would use an inner fund loan to fund those services in 2020, and then pay back that inner fund loan in 2021 using tax revenues.

The jumpstart proposal would spend $86 million out of the city's emergency and revenue stabilization funds.

The choice of using the emergency funds is based on the information on those fund balances included in the presentation from Budget Director Noble to this committee in April.

Another difference in these proposals is how the investments will be administered.

Council Bill 119774 would create a new social housing board to provide oversight on the housing investments and would use the Green New Deal Oversight Board that was established by ordinance but has not yet been implemented to provide oversight on the proposed Green New Deal investments.

Council Bill 119811 would create a payroll oversight committee for the proposed spending and includes a requirement that that oversight committee consults with the Coalition of City Unions, Small Business Advisory Councils, Housing Levy Oversight Committee, and the Green New Deal Oversight Board to inform decisions and recommendations on that spending.

Next slide, please.

So this slide provides a more detailed, oh yeah.

Very briefly on the last slide, we may talk about this this afternoon or later in your presentation, but can you comment very briefly on the emergency fund and revenue stabilization fund?

Just want to note that it does not appear that the mayor's proposed budget at this point would have an impact on that.

Can you comment on that very briefly in case anybody was wondering about that line?

Sure.

We're still digging into the mayor's proposal, but what we have um read and identified so far is that the mayor's proposing to spend about 25 percent of the funds in the existing emergency and revenue stabilization fund that's about uh 29 million dollars or so that makes uh leaves about a 96 plus million dollar balance in those two funds um and so your proposal spends about 86 million dollars so there should be sufficient funds to both move forward with what the mayor has proposed for use of those funds as well as this spending.

And I'll also just note that your, excuse me, the Jump Start Seattle proposal includes a requirement to replenish those funds in 2021. Okay.

So this next slide as I was saying provides a more detailed comparison of the different spending categories proposed in each bill.

I'm not going to walk through this year in great detail, but as you are considering how you may want to modify the spending proposal, this provides two examples of how you could slice the pie.

Moving on to the next slide.

This next set of slides are focused on the proposed investments in new affordable housing and associated services.

This slide highlights some of the specific parameters for the housing spending included in each proposal.

After providing this brief comparison, I'll then walk through estimates we developed at the sponsor's request for affordable housing unit production that could be developed through the Jump Start Seattle Spending Plan.

This table highlights a few key differences between the two proposed housing investments.

One difference is investments in new affordable housing would begin in 2021 under the first proposed spending plan included in Council Bill 119-774.

While Council Bill 119-811 begins investing in new housing in 2022 and in 2021 provides funding for investing in housing stability services.

Council Member Sawant?

Yeah, just a request, Ali.

I know you've mentioned this in other slides, but just for the benefit of the viewing public whom I don't expect to memorize which bill is what number, if you can just point out which one is which bill in terms of council members.

So I think that'll be easier for people to follow.

Thank you.

Okay, thank you.

And just to keep things More efficient, I will refer to the Council Member Swanton Morales proposal and then Council Member Mosqueda's proposal, recognizing that there are also co-sponsors, Council Member Gonzalez, Council Member Herbold, Council Member Lewis, and Council Member Strauss, but it will be a mouthful to say all of the names every time if that's acceptable.

Let me ask the co-sponsors, Council Member Morales and Swanton, since colloquially, I can't get that word out, You refer to it as Tax Amazon.

Would you like to have yours referred to as Tax Amazon and then the one that has me and four others on it just referred to as Jumpstart so that it's easier to get it out?

That's fine with me.

Just recognizing that they're both the same sort of big business tax mechanism.

That's right, yes.

Thank you for that.

So the middle column would be the quote Tax Amazon bill.

The last column would be the quote Jumpstart bill, both or which of which are large assessments, large taxes on large corporations.

But the middle column, again, Morales, this one's proposal.

OK, great.

Got it.

Thank you, I'll try to stay consistent, but my notes might slip me up here.

Okay, so I'll start again with highlighting some of the differences.

As I was saying, investments in the new affordable housing units begins in 2021 for the Amazon tax and in 2022 for the Jumpstart proposal.

The table highlights the differences in housing unit estimates for each of the proposals based on the proposals as introduced.

because the Amazon proposal does not begin investments in new affordable, excuse me, because the Jumpstart proposal does not begin investments in new affordable housing until 2022, combined with a lower proposed annual amount of spending, this results in a lower estimate of total units produced over the first 10 years.

Or put more simply, more money means more units.

It's relatively straightforward in terms of that analysis.

That said, because of the differences in the proposed housing investments in terms of income level serves and the prioritization in the jumpstart proposal for units serving households at or below 30% of area median income, the differences in the total estimated number of permanent supportive housing units between the two proposals is just a few hundred units.

Moving on to the next slide, we'll now focus On the analysis we did to estimate the number of units coming from the jump start proposal.

The actual number of affordable units that will be developed or acquired using funds from the proposed payroll tax will depend on many factors such as cost of land and materials labor costs and accessing to leveraging sources to name a few.

As such developing estimates requires making a number of assumptions.

The estimates provide a rough estimate of what could occur based on these assumptions and get the general sense of scale.

But if there are significant changes in the market or building technologies that modify that construction material costs and timelines that investments could go further or not go as far.

With that in mind.

The committee's request we developed estimates using or different scenarios for the spending proposal in the jumpstart plan.

This slide outlines the assumptions that apply consistently across the four scenarios.

And we're also used to develop the housing unit estimates for council for the tax Amazon proposal.

We can provide a side-by-side comparison for the two proposals, but given the intent expressed on Monday that the jumpstart Seattle bill will be the focus for amendments, we're only presenting the numbers for that proposal.

Next slide, please.

This slide summarizes where the assumptions differ across the four scenarios.

The intent with these estimates is to provide potential outcomes by testing the different assumptions included in each scenario, but it's not a crystal ball.

And as I noted previously, the actual number of units developed will depend on a variety of factors.

Next slide, please.

Scenario one.

uses the average per unit cost based on current office of housing investments and assumes funding for ongoing operating and service costs for permanent supportive housing units that serve the lowest income brackets.

This is the estimate that best reflects what we would expect in unit production based on what we have developed to date.

Scenario two, on the next slide, uses lower per unit costs, assuming strategies to reduce the average per unit cost by about 11%.

I'll point out the obvious here that assuming a lower average per unit

Allie, I think you are frozen.

Is anybody else experiencing that?

OK.

Yes.

Tracy, would you be willing to step in really quickly, or do you want us to hold for a second?

Sorry about that.

I just.

Oh, hi, Allie.

Welcome back.

OK.

Sorry about that.

No problem.

I'm frozen on my screen, so I didn't know if it was everybody.

No.

My whole screen, I don't know what's happening.

I'm having some, I think, technology issues.

So should I start again with scenario two?

I think that would be great if you don't mind.

Yeah, OK, great.

So scenario two uses lower per unit costs, assuming strategies to reduce those costs by about 11%.

And then I was describing the Office of Housing recently released a notice of funding availability for development of housing serving individuals experiencing homelessness.

This proposal is seeking development options that can build permanent supportive housing units at significantly lower costs.

This could serve as a model to understand strategies that could be used to lower the per unit cost more broadly across housing developments.

Next slide, please.

Scenario 3 assumes that the same average per unit cost used in scenario 1 apply, but it would invest 100% of the funds in building new units or acquiring units and does not provide funding for the ongoing operation and service costs for permanent supportive housing.

While this results in a higher estimate for the total number of units, it will mean that another source of funding will be needed to provide that ongoing funding for operating and service costs.

Next slide, please.

Scenario for also assumes the same average per unit cost is in scenario one.

But instead of providing funding for operating and service costs annually.

They serve at this scenario front loads the operating and service costs to cover those costs through 2040 because the proposed jumpstart payroll tax would sunset in 2030 this provide certainty of funding for those ongoing costs beyond the time when the tax revenue would be collected.

And with that I'll turn it over to Tracy who will walk through some of the policy options and then we'd be happy to take questions.

Thank you, Allie.

So moving to the next slide, we'll now begin discussion of the policy consideration for the spending plans for Jump Start Seattle.

So as we've seen, Jump Start Seattle would propose to spend $86 million in 2020, of which $66 million would come from the Emergency Fund and $19 million from the Revenue Stabilization Fund.

As this slide shows, $18 million would be used for small business support, including direct small business assistance.

$36 million for immediate housing which could include rental assistance, shelter deintensification efforts for sheltered and unsheltered homeless individuals, mortgage or foreclosure assistance, and programs to support the ongoing services and operation costs for nonprofit affordable housing and shelter providers.

$18 million would be provided for immigrant refugee support, including language access services and direct financial assistance for immigrant and refugee households.

And then finally, $14 million would be available for food security programs, including continuation and expansion of the emergency grocery voucher program.

So the policy considerations for council as it relates to this spending include whether, in fact, to use an alternative source of funds to support the $86 million in spending in 2020. And this was really based on us not knowing whether, in fact, the mayor would deliver a 2020 revised budget that, in fact, used all those funds.

This may be a lesser of an issue or concern for the council members now that we know that, in fact, she does not tap into those funds and exhaust those in 2020. Additionally, you could consider whether you want to increase or reduce the total amount of funding that actually is spent in 2020. Then there is the ability to increase or decrease total funding amount or amount for each program or service, to add or delete programs or services that are proposed to be funded, and to increase or decrease the amount of assistance that might be provided by the different programs and services.

For example, the small business assistance program is capped at $10,000 per business, And the direct financial assistance to immigrants and refugee households is generally capped at $1,000.

Moving to slide 14, the proposed funding for 2021. This slide shows the proposed spending totaling about $170 million for 2021. $86 million would replenish the emergency and revenue stabilization funds used to support the council's 2020 COVID-19 relief programs.

$65 million would be to provide continuity of services that are supported by the city prior to COVID-19 that might be cut due to revenue shortfalls and also to provide funding to support increased cost and the expansion of services and programs to support low-income communities and others.

And then finally, $17 million would provide support for the council's COVID relief programs that we funded in 2020 and the remainder of $4 million for startup costs.

So the policy consideration as it relates to this proposed funding include increasing or decreasing funding amounts for each program or service and adding or deleting programs or services funded.

Moving to the next slide.

Thank you.

This includes the proposed funding for 2022 and beyond.

This slide shows the proposed spending by percentages.

So currently proposed 65% would be used for housing and services.

And this could include construction or acquisition and funding of housing that serves households that are below 50% of AMI.

operations and support services for housing serving households at or below 30% of AMI, and associated infrastructure costs, such as energy efficiency measures that might be included in the development of housing at this fund source.

10% of the funding would be used for early development of new projects.

including housing and non-housing portions of EDI projects.

20% would be used for small business support, and 5% would be used for startup.

I'm sorry, Tracy.

One second.

There's just a little echo.

I'm wondering, Amelia, do you mind checking to see if we mute your line, if that helps to hide the echo?

How's that?

A little better.

Go for it, Juicy.

So the policy considerations for this proposed spending would be to increase or decrease funding amount for each program or service, to add or delete.

The AMI that's served by, for example, the proposed housing investments.

We're going to need you to repeat that.

There was a lot of garble due to, I think, internet connection.

We will raise our hand if we can't hear you again, but could you say that real slow one more time?

Sure.

So the policy considerations for this proposed spending is to increase or decrease funding amount for each program or service.

I'm sorry about the internet connection, folks.

I know people around the country are dealing with this.

Just real quick to see if we can do a stopgap.

Allie, do you mind summarizing what Tracy was saying right there?

I'm sorry, Tracy.

That's okay.

Sorry.

Sure.

Sure.

As Tracy was noting here, the policy considerations are really looking at adding, deleting, or modifying the spending categories proposed for 2020 and beyond.

This could include increasing or decreasing the funding amount for each program or service, adding or deleting programs or services funded, or modifying some of the spending parameters, such as the maximum income served by the proposed housing investments.

And with that, we're happy to take questions on the spending proposal.

Okay, excellent.

Council colleagues, I know that there's probably a handful of questions, so please do raise your hand and I'll get folks in the queue.

And again, thank you to Tracy and Allie.

I know you have worked really hard to provide us with these various scenarios.

It is not an easy math to do, recognizing that it's not just about the units.

It's about how we couple these dollars with other money that we can leverage as well.

So thank you for providing those scenarios.

I'm just checking.

Council Member Morales, is that a hand up?

Okay, great.

Council Member Morales, you are first up.

And do let central staff know if you want to go back to any of their slides.

Okay.

I didn't keep track of slide numbers, so I'll just put my questions out there.

And there's kind of, I'll say one for now.

One in the, Seattle spend plan and one in the COVID plan.

I'll start with the Seattle spend plan.

So I think everybody knows that EDI is a priority for me.

I think it's really important that we put communities of color first, that we invest in the infrastructure and communities of color first.

So I feel like I need to understand the 2021 spending plan better.

because I wanna make sure that the initiatives that we've created specifically to serve our black, brown and indigenous communities aren't on the chopping block.

And I don't know where in the 2021 plan that would go.

And then I'll just put my other question out there as well.

For the COVID relief plan, when COVID first hit and we were talking about how to react, how to respond to the crisis, the financial crisis that we knew was coming, I was looking for a way to get cash assistance out to individuals really quickly.

And my strong preference at the time, really still, would have been something like a universal basic income.

So we were looking for a way to get cash out the door quickly, in part because I think individuals know best what kind of assistance, what kind of, you know, what they need for themselves and for their families.

I understand that we...

Thank you for the question, Council Member Morales.

Dan, if you could move to slide five, that table provides a little bit more detail.

So, yeah, so I just worry that the relief plan will provide assistance to those who aren't in UDP or FreshBucks or other existing programs and want to understand better how we are investing through that in the kind of trusted community advocates?

I think the language in my, can people hear me okay?

Because I think Allie's frozen now.

Can you hear me okay?

I'm back.

Sorry about that.

I think the intent on the assistance to immigrant and refugees is to provide direct financial assistance and to use trusted community-based organizations to get that funding out directly.

So not just rely on those folks being in existing programs, but.

Let's see, can you hear me now?

Tracy was just garbled a little bit.

This is a little bit like a Saturday Night Live skit.

I feel like I'm frozen.

I can hear all of you.

But Tracy, you did cut out at the end there if you want to reiterate anything.

Okay.

Well, I'm not sure what I might have missed that Tracy said.

I think I'm going to start by trying to address Council Member Morales' question related to the Equitable Development Initiative.

A specific funding line for the Equitable Development Initiative in the Jumpstart proposal doesn't come into play until 2022. That's a 10 percent of the proposed spending and assuming about $200 million, that's about $22 million.

The plan for 2021 includes replenishing the money spent out of the emergency funds in 2020 and then provides about 65 millions for continuity of services.

So that is for funding programs that might see a reduction in spending or investments in those programs because of the revenue shortfalls we're expecting due to the COVID-19 crisis.

So one of the places where that could work is to at least ensure that the equitable development initiative is funded to its current status of about $5 million a year.

So that's where those sorts of investments show up.

And then it sounds like Tracy covered the direct cash assistance for immigrant and refugees.

And then I will say in terms of the COVID relief generally, where the original proposal that you introduced, Council Member Morales, as well as some amendments you discussed, would have either provided direct cash assistance that the city disperses using people enrolled in existing programs generally, or your amendment that would have worked with community-based organizations to identify those households.

The jumpstart proposal also includes providing direct relief, but it is not necessarily financial assistance.

It's more specific categories of investments for small businesses, immigrant and refugees, food security, and immediate housing needs.

So both providing relief, but in slightly different ways.

Okay, colleagues, I know we're having some computer issues.

Is there a follow-up question, Council Member Morales?

No, I think the thing that I'm struggling with a little bit is the difference between trying to provide immediate assistance directly to households and families versus, you know, through programs that That's just some of the tension and the struggle that I'm having, but I will continue to work through it.

Thank you.

Great.

Council Member Herbold.

And then if there's anybody else, I'm sorry, with the computer glitches, please do hold your hand up so I can see you.

Okay.

Council member.

Thank you.

Let me just get to my questions.

I muted myself.

So, I'm just going to kind of go through slide by slide as I.

categorize my questions.

I have questions about slide 5, 6, and 7. As it relates to slide 5, just would love a little bit more detail about what is meant by sheltered intensification.

specifically what activities does it support?

When we talk about shelter D intensification, we can sometimes be talking about different things.

I just want to know, can it not only be used to support existing congregate shelters, new congregate shelters that have been created during COVID-19 to create social distancing within existing shelters, but also can it be used for non-congregate options like hotel rooms or tiny villages?

As it relates to slide six, just wondering, is the total unit estimate category inclusive of permanent supportive housing units or additive?

Is this the category where potentially construction and siting of new tiny house villages could occur?

I think that is a great question.

And then as it relates to slide seven, the question is how would actual determination be made of how the resources are allocated?

Is there a mechanism for an annual implementation plan or is it done through the annual budget process?

the executive for a recommended plan, but just trying to get a little bit more granular detail of whether or not this is, you know, again, an annual implementation plan or is something that we get recommendations through the budget process.

Thanks.

You're moody, Dolly.

Okay, that was just a user error, not technology.

Starting with your first question as it relates to the proposal for spending on immediate housing.

What the language in the COVID relief bill actually says, which is included as a proviso, is that It's money for shelter de-intensification activities in housing or shelter options for unsheltered homeless individuals in non-congregate settings, including costs for new tiny homes, acquiring or leasing hotels or motels or other buildings, or extending leases on such facilities.

So it could be used for either, but it is left open.

to be determined through the implementation.

And so if you wanted a more specific sort of allocation of funds for those different activities, that language could be parsed out for more specific uses.

Moving on to slide six.

This is a portion, about 65% of the proposed spending for 2022 and beyond, and it is for new affordable housing serving our homeless people experiencing homelessness, as well as people at the lowest end of the income bracket.

It's prioritizing housing, serving households with incomes at or below 30% of area median income.

It isn't currently intended for use for shelter type uses in non congregate settings like tiny homes.

But sort of related to your next question in terms of how this gets allocated that the bill does request an implementation plan from the executive that would inform the annual decisions the council makes in allocating funding for those uses.

So it would be a both and.

First, an implementation plan that would be adopted by the council, followed by the annual adoption of the appropriations.

An implementation plan is for 2022 and beyond.

very helpful.

I appreciate.

And then my last question is just sort of now that we have the mayor's budget, and we are going to begin to delve into some of the proposed cuts in the mayor's budget, are we going to sort of, and I guess this is a question for the bill sponsors, the sponsors of the two bills.

But I'm interested to know whether or not we are going to now have a discussion about whether or not we agree with the proposed cuts in the mayor's budget and might be open to using some of the revenue anticipated in this legislation to rethink the wisdom of some of the cuts in the mayor's proposed budget.

Or if we have some other way that we're thinking about rebalancing the mayor's rebalance budget.

I think that's a policy option for the council to consider.

We are still digesting, um, have not yet figured out all of what's in the mayor's proposal, but we'll be looking at, um, as at least as a starting point where there might be similar proposals for some of, especially the immediate COVID relief, um, and can talk with you and the rest of the committee more offline about some of those options.

If there are, uh, programs or services that are proposed to be eliminated or spending reduced, due to the budget situation we're in, there are options available.

I'm sorry, I was having technical problems as well.

Council Member Gonzalez, did you have something in relation to Council Member Herbold's question or did you want to get in the queue?

No, I had something in relation to Council Member Herbold's.

Please go ahead.

I appreciate that line of questioning.

And I do think this is one of those situations where all options should be on the table.

So I think that looking at those potential options as do we see this revenue proposal or other revenue proposals as a mechanism to backfill those budget cuts so that we can I think it is a good question.

I think the question of how we can prevent budget cuts is certainly one question.

There is also the obvious other option of cutting in certain departments.

Particularly the Seattle Police Department to accomplish that not as backfill.

So I'm not, I mean, I think as a council, we need to be open to all of those possibilities as a path forward.

I feel like, you know, looking at this revenue proposal as backfill is probably not what we want to do.

I think we want to see this as a new additive revenue to, this issue and looking at departments like the police department to backfill some of the proposed budget cuts would certainly be my preference in terms of moving forward with the rebalancing package.

So I just wanted to put that on the table in terms of the broader question, budget approach question that was being posed by Councilmember Herbold.

Thank you, Chair.

Thank you, Madam President.

And I also would agree with that and look forward to that discussion this afternoon.

I think we'll have a more robust discussion, especially about how to reallocate some of the existing SPD's budget.

So thank you for that question.

This does help us, though, I would say, with the proposed cuts that are expected in 2021, that fiscal cliff that has been described by Ben Noble.

I think the word was inevitable.

I think that the.

options that we provide when we have progressive revenue help to address that cliff so that there is not actually the type of layoffs that we're seeing.

Council Member Ruben, did you have one final thing?

And then Council Member Strauss.

I just, I wanted to take this opportunity to queue up a potential amendment that I may be bringing forward as it relates to the eligibility of businesses to be taxed, actually beginning in 2020, because I too am really concerned about what I think the amendment that I have been considering is intended less to create the opportunity for more additive spending in 2020, but also focused instead on 2021. that we are going to have to deal with.

We are going to have to deal with the mitigation of what director noble is predicting will be a need for layoffs.

for 2020 based on 2019 payroll, and it would raise an additional approximately $75 million from that 2020 obligation.

and the thought that I have a couple different versions.

The one version assumes some small level of spending in 2020, maybe about $10 million.

And the majority of it, the additional 65 million going to mitigate 2021 impacts either by that we are going to be paying back the emergency sub fund or actually directly mitigating payroll reductions.

The other version in total puts that whole 75 million in 2021 and none in 2020.

Council Member Strauss, please go ahead.

Chair Mosqueda, my questions are on slides five and 13. Thank you, Tracy and Allie for the work that you have done with this presentation.

I will preface my comments by saying it's been an absolute pleasure and honor to get to work with the small businesses in my district.

As you know, we've been providing essentially case management for small businesses trying to navigate the different layers of resources from federal .

In this process, we found many gaps in the resources that are available to small businesses, which resulted in a letter that we as a council signed and sent to our state and federal delegation.

So there are a number of things in this, as slide five, the immigrant and refugee support I think is very important.

The food security and immediate housing are all things that we have heard are either not funded enough or not, or in the case of immigrant and refugee support, just simply a gap in the resources available.

with the small business support i do have we are at this time working with the small businesses in my community to identify what what changes or amendments we may be bringing forward.

So I just flagged that for my colleagues now.

We don't have amendments written or fully developed.

This is a work in progress at this time.

I was wondering Tracy or Allie, if you could provide us a little bit of background on when you say business support resources, what do you mean by that?

And if the answers aren't at your fingertips right now, I'm happy to follow up offline.

Thank you, Council Member Strauss.

For the small business assistance, the majority of the funds are proposed to expand or add funding for the small business stabilization fund that has been used to provide grants of about $10,000 to small businesses.

as well as funding to support family child care providers.

And I'm working with Councilmember Mosqueda on modifying that language to expand it a bit to include a broader range of child care providers.

And then it provides, I think it's about $320,000 for the office of economic development to expand their technical assistance programs.

And I'd be happy to talk to you more about that council member Strauss.

But as Tracy noted, this is one of the this is sort of the parameters of the spending that we're talking about that council members may want to consider modifying, such as the amount of funding or in this case, the definition of a small business, which is defined as businesses with five or fewer employees.

And that's based on the requirements for the current Small Business Stabilization Fund.

Thank you, Allie.

Would we have the ability to modify the definition of small business, whether it's changing employees to FTE or the number of employees that that business has within their company?

Yeah, you can put you can modify the definition.

What's important here as we're providing support for small businesses is that it's either supporting a small business owner who is low income and or is helping to stabilize our local economy by ensuring that businesses remain open and employing people and contributing to the city's tax base.

Thank you.

And one thing that we've heard, this may be changing gears into the immediate housing, which is rental assistance.

Is there a realm in which small businesses that are having difficulty paying rent would be able to access the rental assistance program or is that simply for residential?

It's residential.

But to be clear, some of the business support assistance could be used to cover, uh, rent payments as well.

I don't believe that the business assistance is limited in that regard.

So that is legally available to us?

Yes.

Thank you.

I need to turn down my audio.

Apologies if I'm yelling at anyone on accident.

Those are my questions, Chair.

Thank you very much.

We may have lost our chair.

I'm scanning here.

We did lose our chair.

So I will go ahead and quickly pinch it here.

So I believe that Council Member Sawant was next in the queue.

So Council Member Sawant, please.

Thank you, President Gonzalez, and thank you to Chair Mosqueda for organizing this discussion.

I wanted to preface my points with just an overall comment, and then I do have questions and also clarifying points for slides, and I'll also go from one slide to the next in a bit.

And then I also wanted to just share with members of the public the amendments that my office is intending to bring.

So I just wanted to first recognize the movement of ordinary people that has brought the city council to this point.

I mean, the fact that the city council might be at a point where there's a serious consideration to pass an Amazon tax, that is a tax on big business, to fund affordable housing and services is entirely and exclusively, as Hannah Swoboda, who's a tax Amazon activist, said in public testimony, due to this movement, the black and brown community members and leaders and multiracial community activists, the rank and file union members, Democratic Party activists, socialists, including the community organizers in my office and Socialist Alternative.

Big business has been forced to recognize the tremendous community support that exists for the Amazon tax.

And it's really crucial that Council Member Morales and I were able to co-sponsor this legislation for a $500 million Amazon tax proposal, and I wanted to also thank Councilmember Mosqueda for seriously joining this conversation.

I also wanted to say, terminologies have everything to do with narratives of what are the forces that create social change.

Our movement is using the phrase Amazon tax to describe the fact that it is a tax on big business, not a tax on workers or on the employees of the companies that would pay the tax.

And by that measure, both the proposals under consideration are, in our view, and the movement has chosen this terminology, so I'm following the collective decision of the movement, that these are both, by that definition, Amazon taxes, meaning they are taxes on big business.

They both abuse the exact same mechanism of corporate payroll tax.

And so I, just to clarify, in my what in my points, I will try to distinguish between the two by calling it the movement's Amazon tax, which is the Sawant Morales Amazon tax versus the Democrat's Amazon tax, which is also a big business tax, as I said, and I appreciate, which is being co-sponsored by many on the city council.

So just to note that.

It's also worth noting, and this is related to the discussion that was just happening, which is a very crucial discussion, which is we're in a deep recession.

and there is going to be a budget shortfall because we have a regressive tax system.

And completely, I agree with Council Member Scata completely that we have to reject austerity budgeting entirely.

We absolutely have to make sure that there are no cuts to already underfunded services and for housing.

And just to note the numbers, the COVID related budget shortfall is something like $210 million.

So I just wanted to put that in perspective for the people who are watching this.

That means that the $174 million worth of the Amazon tax that the Democrats on the city council are proposing is not even going to fill that role.

I absolutely agree with the council members who have said that this has to be additive.

And I'm going to mention that in the amendments that I bring up.

I just wanted to clarify that if you look at the numbers, and if you judge by the dollars on the table, then the Democrats' Amazon tax is baseline, as Council Member Mosqueda said.

It is a bare minimum.

It won't be acceptable to further water it down.

I just wanted to say that for the record, because I fully expect that there might be amendments to that.

I think that that is absolutely the bare minimum.

And we have to make sure that it's actually improved rather than watered down.

So having said that, if I could go by slides, can I go to slide five?

I did have a question on slide four, but I'll hold that for a second.

Can we go to slide five?

Just a small point to clarify that the movement's Amazon tax funding goes directly to households, as Ali clarified, whereas the Democrats' Amazon tax proposal would go to the NGOs.

So I just wanted to clarify, I would support anything and everything along either of those lines, but we don't – it's not accurate to say that the Democrats' proposal supports immigrants and small businesses, and ours does not.

That doesn't – that's not accurate.

Our proposal would give the money directly to low-income households, including immigrants and small businesses.

The Democrats' proposal would channel the money to NGOs.

I think both would be better, either would be better than what we have today, which is no funding from the local and state level.

We have inadequate funding from the federal level.

On the same, and the slide contains a lot of information on slide six, sorry, slide six, I wanted to go to slide six, which contains the sort of the big summary of comparisons, which is really important.

So the movement's Amazon tax proposal would fund affordable housing for up to 100% of area median income.

Just again, to not use terminologies that not everybody's familiar with, area median, that would mean $86,900 a year for a two-person household or $108,600 for a four-person household.

The Democrats' Amazon tax would fund affordable housing for up to 50% of area median income, which is $43,500 for a two-person household or $54,300 for a four-person household.

And my office will share all this on our website.

People who are watching this don't have to worry about the numbers, but I just wanted to share that.

I just wanted to clarify that the number of permanent supportive housing homes built under the movement's Amazon tax is roughly 2,600.

I'm going by the estimates that central staff have given us.

And the number under the Democrats' proposal would be 2,300.

So 2,600 in our proposal versus 2,300 in the Democrats' proposal.

And overall, there's a big chasm in how many affordable homes would be built in the city.

Overall, the estimate is that the movement's Amazon tax proposal over 10 years would build 10,600 affordable homes versus in the Democrats' proposal, 3,200 affordable homes.

I think it is very, very important First, you take note of the actual material realities of how strong of an Amazon tax is passed.

It's not like jockeying for political points between socialists and Democrats on the council.

It has actual consequences for working people, how much of affordable housing they get.

Although I absolutely, again, want to reiterate that it is extremely important that the council is discussing passing any Amazon tax at all.

And also to clarify that under the Democrat's proposal, no affordable housing for households between 50 and 100% AMI will be passed.

So I want to note that and also note the starting date.

My office is intending to bring an amendment to the Democrat's proposal to have it start early.

And I heard Council Member Herbold speaking about that.

Just wanted to say happy to join you, Council Member Herbold, in working on that together.

So now on slide 8, one clarifying question, and I just want to finish my points and then central staff can answer some of the points.

Slide 8, I think the lowest cost estimate is based on what was called the third door.

proposal, as they said, to quote unquote streamline zoning and other regulations, potentially pay workers less or ignore priority local hire, but I'm not sure about that.

So if there's any information that central staff have or if they can get it for the next meeting, what are the specific efficiencies that are assumed to map out this scenario?

Will it still honor prevailing wages, that is commercial rates?

will honor local higher apprenticeship utilization, stuff like that.

Those are things that we are automatically assuming in our movement's proposal that absolutely all of those things will be honored, especially given the deep racial inequality in our city.

On the sunset clause, just one thing if central staff can.

confirm, isn't it the case that the revenue under the movement's Amazon tax proposal, because it provides an ongoing revenue source, could be bonded out in the future to get even more dollars to build housing and to fund Green New Deal?

And just on that note, I want to clarify that our Amazon tax proposal actually has real dollars for Green New Deal programs, which is completely absent from the Democrats' Amazon tax proposal.

So that's one question.

Because it provides an ongoing revenue source, couldn't it be bonded out in the future to get even more money?

Whereas in the Democrats' proposal, is it accurate to say that it couldn't be bonded out because of the sunset?

Maybe I'm wrong about that, but please clarify that.

And then also under the Democrats' proposal, would the city pay for the permanent supportive housing units operational cost after 2030?

Because if there's a tax sunset, there's no funding for it in the proposal.

And that's not a minor question.

I think it's probably close to 500 permanent jobs, ongoing building maintenance jobs, and so on.

So it will have real consequences.

So that's something that should be Clarified.

Then another question is, what is the current shortage of again relate with all three questions are related to the sunset clause.

What are, what is the current shortage of affordable housing in Seattle, and under current projections, what would the affordable housing shortage be in 2030. if this sunset clause was to pass.

And I just wanted to say, these are not neutral questions.

A sunset clause is absolutely unacceptable.

It's a poison pill that is the result of a strategy of not working with movements, but building trying to build agreement with big business who are deeply hostile to any progressive measures.

I mean, on the one hand, we have some businesses joining the Democrats' proposal.

On the other hand, the Chamber of Commerce sends out a mass email yesterday saying, you need to sign up for public comment because we don't want taxes on big business.

So, you know, they're playing both sides, and this, you know, they prove, they continually prove our point from the movement that they cannot be trusted.

So I just wanted to say that.

list of amendments that my office will be bringing forward.

I think very likely in partnership with Council Member Morales' office, although we haven't had specific discussions, and I welcome any other council member to join us on those amendments.

So one is an amendment to use the tax method in our bill and increase the rate to 2% from 1.3% to bring in another $200 million, a total revenue of $700 million, to avert all city budget cuts.

So just to clarify, this is an amendment that is something that is sort of building off the movement's Amazon tax proposal, so that would need to be adjusted if it's an amendment to the Democrats' proposal, which we have But my point is that the amendment that we will be bringing forward to increase the tax rate, I think, has to take into consideration not only bringing up to what the movement's proposal is, but that plus the taking care of the tax cuts, sorry, the budget cuts that will come because of the recession-related austerity.

I agree with all council members who said that it needs to be additive.

We'll be bringing an amendment, as I said, to eliminate the sunset clause, which is a complete stop to big business.

I mean, do we think that the housing crisis is going to magically disappear in 2030?

And then, as I said, advance the effective start date of the tax to July 1st, 2020, or August 1st, 2020 of July is not possible.

And as I said, happy to work with anybody on any of those amendments.

I might have some comments later on, but I'll stop there.

Thank you.

Council Member Swann, thank you.

We do have Council President Gonzalez in the queue, and there's a number of questions or comments.

But for the questions for central staff, please feel free to answer those.

I do want to have two pieces of clarification real quick, though.

Number one, because Council Member Morales also asked this question about direct cash assistance, I want to make sure to correct the record on dollars getting directly into individuals' hands.

There is, in the Jump Start proposal, direct cash assistance for immigrants and refugees.

It does provide immediate financial assistance for families.

Number two, as it relates to worker protections, obviously as the chair of labor in the past and coming from labor, worker protections are something that I've constantly pushed for, including into affordable housing efforts.

I've been strong, unequivocal on this issue.

And in the jumpstart proposal, as you will see explicit in the document itself is language regarding prevailing wage, apprenticeship utilizations, women in minority-owned business, contractors as well.

We put intent language into the legislation as well, incorporated standards that are built off of the language that we really push for in the K-site, being a pioneer and making sure that there was strong labor protections in the K-site effort two years ago.

We are replicating and learning from that effort.

I'll have more to say on that about the way in which the Jumpstart legislation is consistent with the process set forth by labor standards and in collaboration with affordable housing efforts that we have worked on in the past and have embodied into this legislation.

I just wanted to make sure that I corrected the record on those two pieces, and I'll have some more comments on that later.

Central staff, if you have a response to any of the questions that Council Member Suwant put out, please do feel free to answer those, and then we'll move to Council President Gonzalez.

I'm going to start with trying to answer a number of those questions that relate to the housing costs.

So the low-cost option that Allie described is, in fact, based on the Third Door Coalition's proposal.

And theirs includes a number of different assumptions.

One, that there can be some streamlining of the zoning and due process for new housing.

Sorry.

What's happening, but we might do what you did with what Tom did before and have you put your computer on mute and call in.

I'm going to see if while you while you do that, if maybe Ali can chime in real quick as well.

Great, thank you.

So I think where Tracy was going is that the low-cost option is based on the per-unit cost numbers, based on the third-door information.

That assumes a number of things, that the per-unit cost is reduced by free land, building technologies, permitting, streamlining, a number of things.

We can't verify that number.

And that was sort of why I had noted that the Office of Housing has a notice of funding availability currently out the door to try to get proposals for more innovative construction methods that might bring down the cost.

So that example was just to illustrate what could happen if the unit costs successfully are driven down.

But it doesn't assume that this council, that these sponsors would support reduced labor standards, for example, in building those units.

I think that answers that question.

Another question was related to bonding, using this revenue source to bond against it.

A couple of clarifications.

So issuing you could.

issue bonds to spend more money now, but it's not creating new revenue or more revenue.

It would just be a way to finance investing in more units today, but would cost more over the long run because of financing charges.

And then I would ask Dan, Eder, or Tom if they had anything to add in terms of using a tax that has a sunset date as the assumed source of funds to pay back.

the um the principal and debt service on issuing issuing those bonds but in general when the city issue bonds um we intend to have you know a secured revenue source to make sure we can pay it back but ultimately if that revenue source was insufficient the city's general fund would be obligated i believe uh yeah this is dan eater uh deputy director of central staff i um i think ally what you just said is absolutely correct um the only uh

thought that I would layer in is that debt can be issued for a variety of time periods.

And so what we typically do for LTGO or long-term general obligation debt is issue 20-year bonds.

20 years is a longer period than the the jumpstart legislation as introduced would provide funding for, and so the last 10, if we were to issue that kind of 20-year debt, the remaining amount of time, 10 years or more, depending on when the bonds were issued, would become the obligation of the city without an identified means for repaying that debt.

It is also possible that the city could issue eight-year debt or 10-year debt and have the amount of outstanding borrowed funds be repaid entirely with the jumpstart stream of revenue.

That's not how we typically do our bonding, but it is also a distinct possibility.

I agree with what you said, Ali, that bonding is a financing mechanism that effectively moves the ability to purchase things up front with a longer payoff on the back end, which eventually costs more money because the bond bondholders who have loaned the money to the city would expect not only to be repaid, but to be repaid with interest.

So that interest becomes the added cost that the city incurs for the benefit of providing the purchased affordable housing sooner.

So that's the trade-off that policy makers can weigh in on.

Great, thank you.

Thank you, Dan.

I think there was a question also about the needs and how well would this proposal meet the affordable housing needs.

I don't have that information available in front of me right at this moment, so we will follow up with the committee on that question.

And then there was also a question about investing in permanent supportive housing units with a fund source that would only go through year 10 and what would be the strategy for the ongoing operating and service costs.

One of the scenarios, I believe it was scenario four, provided an estimate that front-loaded 20 years of costs into the first 10 years.

The revenue proposed that would sunset would basically put in the bank, the money to pay for the ongoing operating and service costs through year 20 and typically, I believe the office of housing.

does, in their contracts for permanent supportive housing, contract out for and provide a commitment to provide services for 20 years.

And that is often renewed.

But in any case, if any tax has a sunset date and or a future council decides to repeal a tax, an alternative source of funds would be needed to provide that ongoing operating and service costs.

Thank you.

I see Tracy is on the line with us.

Tracy, please feel free to chime in.

I know we had to cut you off there.

So go ahead.

Let's see how you're handling this.

So sorry about that.

All I've had this problem before was Zoom.

So Ami's absolutely right.

After year 10, you would have to find another source of funding.

We actually have used housing levy to in fact provide funding both for new PSH service costs, but also for those renewals of housing that we have funded over the years.

And so as it might just so happen, there will be another housing levy at about year 10. So if in fact, at the end of 10 years, if we chose not to forward fund the PSH for 20 years, that would be another backstop of sorts as a funding source for the additional 10 years of the operating services costs for those PSH units.

Okay.

Thank you, Tracy.

Thank you, Allie.

We have Council President Gonzalez next.

I do want to read something into the record, though, because I am very concerned about anybody taking away from a conversation that there is anything less than strong labor standards in the Jump Start proposal.

Again, the ordinance that we worked on years ago, which was Ordinance 119531, was groundbreaking in that it included additional labor standards in our efforts as a city to build affordable housing.

So I want to point to line 15, page 12 in the spend plan.

It says, housing projects funded with this tax will be built consistent with the city's housing funding policies as adopted by ordinance 119531, or as amended.

These include, but not limited to, requirements and goals that advance labor equity outcomes, such as the payment of prevailing wages, apprenticeship utilization, and employment of women and minority-owned businesses.

Imposing additional requirements include, but not limited to, preferred entry of apprenticeship programs, requirements of pre-apprenticeships, mentoring or other training programs, and utilization of workers from economically distressed areas will be considered for new construction projects on the results of evaluation.

This is the ongoing evaluation we're doing at the Mercer site, so this is building on the work that we did at that case site to incorporate strong labor protections.

Just want to make sure folks know that that's in there and it is not my intent and I believe the council's intent to constantly be looking at ways that we that is true here in the spend plan for the jump start legislation as well.

Council President Gonzales, thank you for waiting.

Your turn.

make this a little shorter today so I will make this as quick as I can.

A couple of things.

One is there was a question by Councilmember Strauss around potentially changing the definition for small businesses that would be able to qualify for the OED aspects of the jumpstart proposal as part of the COVID-19 relief fund.

I just want to throw out a policy consideration for us as we consider that kind of potential proposal, which is that I think it would be helpful to me to understand from Council Central staff What kind of programs are currently available to businesses based on their size?

Now, my understanding is that much of the federal programming, for example, was swallowed up significantly by some of the larger businesses.

And a lot of our smaller businesses were really left out of being able to benefit from that federal relief package.

And so I think it would just be helpful as we consider a potential amendment to the definition of the size of the business if we can get a better understanding of what programs are available to which entities under the OED umbrella in particular.

Is that something that you all would be able to have an opportunity to dig into further to give the council a little bit more guidance as we look at where to set the dial as it relates to who can qualify for those benefits?

Yeah we can look into that question and we can certainly provide information about the different eligibility requirements as well as talk with OED about what they're learning about not just who is eligible but who has been successful and able to to actually obtain that assistance.

I think we probably are hearing similar things in that smaller businesses with less sort of administrative support just can't compete because they can't move as quickly to get all their documents lined up and applications in and that sort of thing.

So we will work with OED to put information together and at the very least can provide the differences in eligibility requirements and what we have learned so far about who's been awarded various grants or loans.

Thank you, Allie.

And then, Tracy, I think you wanted to jump in.

Is there anything you wanted to add?

I just wanted to say that we'll do our best to try to get the information.

There have been some recent changes to the federal relief for businesses that actually provided resources to smaller CDFIs and other entities who are directly being required to give money to smaller businesses.

And I believe they're going to do that businesses.

The question is, is that data available now, given that those changes that just happened?

And we'll do our best.

I think OED is doing some regular surveying.

We'll just have to see what they have available.

At a minimum, we can find out what we know from the first round of the loans, as well as what we've actually been provided to the businesses from the funds that we have already allocated to see who got help and who's still sitting left in the queue who wasn't assisted.

So we should be able to get that data at a minimum.

Great.

I really appreciate that.

And then, um, I would also, um, I also am interested in hearing, um, from council central staff, whether there is existing language in, uh, the ordinance that creates some sort of, uh, prioritization or focus on, um, uh, On racial equity and in this particular space and I'm particularly concerned about those businesses who don't have Who don't who don't I'm particularly concerned about entrepreneurs and micro enterprises and businesses that don't have English as their first language.

And these are primarily immigrant and refugee-owned businesses that just don't have the same even level of knowledge of the fact that OED even exists, much less the programmatic services that they might have.

Can you talk to me a little bit about whether there is existing language in Jumpstart that would require a specific focus or prioritization of those types of businesses?

Sure, Council President.

So the proposal for the small business assistance says specifically and this is I think on page 10 of the bill for people who are following along assistance should be prioritized for businesses to commit to not reducing wages and benefits provided prior to the COVID-19 emergency and for businesses with historically or recently been unable to access other forms of assistance through state or federal programs available to support businesses putting businesses owned by black indigenous and people of color and businesses in the creative industry.

So there is that priority language and we'd be happy to talk with you if you're looking for additional criteria there.

And then I will also note that there is, In the allocation to the Office of Economic Development, there is about $300,000 for technical assistance.

And then there's a separate allocation to the Office of Immigrant and Refugee Affairs.

In addition to providing direct cash assistance or financial assistance to immigrant and refugee families, there's also funding to help support community-based organizations to provide translation and technical assistance for people and businesses who are applying for federal or state assistance or other programs.

So there's those two areas of that sort of technical support.

I appreciate that.

So I'm familiar with the language access points and I will have some, my second line of questioning will be around the spending proposals for immigrants and refugees.

But on this particular point, I just want to flag that I have an interest in proposing a potential amendment to the eligibility criteria and to that prioritization language that you just read, Ali, that would really call out a little bit more clearly the need to figure out how to prioritize business owners and entrepreneurs who whose English is not their first language and who therefore have a greater degree of difficulty accessing these programs.

And I think that that would couple well with the intent on the language access line of investments that, you know, my hope is that we can pair those together a little bit more strongly to thread the needle there to acknowledge that of the approximately 98% of businesses that exist in the city, many of those are very, very, very small businesses.

And immigrants and refugees tend to go into that entrepreneurship route and unfortunately do so without knowing all of the available resources to them.

And I really wanna force the hand around the city and OED in particular, understanding deeply the need to prioritize language access in their funding decisions and prioritizations.

I just want to add a flag that I have interest in pursuing language there.

On immigrants and refugees, can you remind us as a council and the general public what the language is in the existing draft of the Jump Start legislation about which populations from the immigrant and refugee population qualify for assistance?

Does it specifically include undocumented immigrants?

Does the language say undocumented immigrants?

The language does not say undocumented.

Can you tell me what it does say?

Yeah, let's see.

I'm just trying to find the mode.

I don't want to read the whole ordinance to you.

Or I'm happy to, if that's what you all want, if you don't want to eat lunch.

So it talks about, it says, Direct financial assistance to Seattle's low-income immigrant and refugee workers and households who have experienced the economic impacts caused by the COVID-19 crisis and may be used for no other purpose.

And for programs and services that provide language access support for low-income people who need help accessing and understanding federal, state, and local assistance programs and may be spent for no other purpose.

And then it talks about administration.

And then, It says that community-based organizations will determine the eligibility, including criteria to confirm income eligibility, prioritizing those who are ineligible.

for other federal or state emergency assistance or receiving such assistance in a limited or delayed manner that does not meet their needs or those who have not had or whose families have had adverse health impacts from COVID.

Requests for documentation of eligibility should not impose an unnecessary burden on those applying for assistance and should not unnecessarily delay the approval and distribution process.

So it neither, it does not ask or it does not limit it to households or individuals or workers who are or are not documented.

Great.

I appreciate that.

So I, it would be helpful to me if Allie, you or whomever is appropriate on council central staff would crosswalk that language with the language that we included in The, the creation of the legal defense fund.

I want to obviously this is an area of great sensitivity and we found the right balance in in the creation of legal defense fund to allow immigrants who may be of undocumented status to continue to apply for those funds without compromising their confidentiality should the city come into possession of that information.

would be subject to public disclosure.

So I wanna make sure that we've got that buttoned up and tightened up to the greatest extent possible.

So I think it would be helpful to me if we can do a crosswalk between that language and the legal defense fund ordinance.

Great, I'd be happy to do so.

And I appreciate the specific direction on where to look.

It makes the job even easier.

Yeah.

And I'm obviously leading you a little bit down a path here.

But I think that, you know, if you could do that, and then get back to me with some analysis, I want to flag again for my colleagues that depending on that analysis, I may be bringing forward some of the editorial language to to provide, to address the issues related to confidentiality in that space and to make sure that we are protecting all immigrants and refugees who qualify for that assistance through the language in the ordinance and look forward to that analysis and the opportunity to potentially do some of that additional work.

Thank you, Chair Mosqueda.

Those are all the questions that I have.

Thank you so much.

And I really appreciate you flagging the need to harmonize that language.

I know we've talked a lot about looking at Austin's model, but we need to make sure that we're replicating the language that you've worked hard on here in the city of Seattle as well.

So points well taken.

Dan Eder, I saw that you teed up the PowerPoint presentation.

Do you have some more slides that you would like to cover with us?

Okay, I see nodding.

Let me just, before we go on to that, to flag a few things for my colleagues here as it relates to the spend plan.

First, I wanna note, as I believe Ali mentioned earlier, I've been working with some of the childcare providers in the city and their union, SEIU 925. And I'll be introducing an amendment that we're working on right now and happy to talk with anybody who has questions about it as we draft a possible amendment to ensure that childcare businesses support funds can be used at child care facilities as well as child care family homes.

And to clarify that you don't need to be a participating child care provider in a city program to be eligible for these funds, especially as we think about the sheer number of people who need child care for their kiddos who used to be in school or school-based programs, summer programs, really trying to scale up access to child care has been something that everybody has been talking about, especially working families and those who small businesses who need to make sure that their their kids or their employees kiddos have access to comprehensive appropriate child care and we have trained qualified folks who are providing home-based child care who are excited about the opportunity to partner here.

I also wanted to just note earlier I believe Ali or Tracy you mentioned sort of the way in which this scenarios dovetail with other issues that are sort of outside of a spend plan proposal.

I would be remiss if I didn't mention that we continue to have the opportunity to draw down the overall cost of building affordable housing by doubling down on our efforts to build on surplus land.

This is legislation that I passed two years ago, but when we build affordable housing on surplus land, like the Escott property that's adjacent to churches in the South end, and identify other opportunities for us to build housing, and that we continue to address the exclusionary zoning that limits us to where we can build affordable housing and multifamily structures, remembering that 75% of Seattle's land is currently locked into single-family housing.

We have, I think, an opportunity to keep pushing forward on building on surplus land, addressing current zoning issues so that we can free up more land in the city to build affordable housing, to streamline permitting, this is something that we've been constantly working on, and I know that the chair of land use is interested in how we continue to streamline permitting as well to reduce overall costs in the system and overhaul the design review process.

So those complementary policies, I think, are something that we're not going to let off the gas on as we continue to push for affordable housing and to draw down the total dollar amounts that hopefully we can see even more housing built out of this.

I'm really excited about the conversation that we had today, and I want to thank Council Member Sawant, who was asking for this sort of comparison.

I think it is important for us to know where the dollars are going, where we could potentially use some levers to scale up or down in terms of which AMI population we're talking about.

Thank you for highlighting those efforts here.

I want to reiterate that for households between zero to 30% of the area median income, is staggering 75% of those folks at the lowest wages are rent burdened with nearly 60% of them being extremely rent burdened.

That means that they're spending more than half of their income on rent.

So I think it's really important.

Thank you for asking for this information so we can constantly be thinking about how we invest in more affordable housing.

I saw one last comment here and then we'll go on to the spend plan and then we'll have some concluding comments from any of the council members.

We are excited as well, I think, to highlight for folks on page four of the spend plan narrative that was sent around.

We want to continue to work with all of our council colleagues as we scale up additional language and investments for infrastructure, Green New Deal priorities like infrastructure, maintenance, retrofitting, energy efficiency upgrades to support affordable housing in this plan.

We have built into the proposal building emissions, compromising about we want to recognize that and support efforts to create more energy efficient and greener buildings such as the hdc's exemplary building challenge for creating deep green building in affordable housing and permanent supportive housing.

This is something that is currently not dictated in terms of a source of funding for the city and requiring that as a permanent source is going to be helpful in the future.

think about ways that we can double down and invest in that effort.

Dan and Tom, I'll turn it over to you.

We have about 45 minutes left in our effort to make sure that people have at least an hour break for lunch and look forward to hearing from you all and then closing comments from council colleagues.

Thank you, Chair Mosqueda.

For the record, I'm Tom Biksa with your council central staff.

I'm just, I fortunately have a few slides.

I have three in a similar parallel fashion to the spend plan.

I'll touch on the comparisons between the Council Bill 119-772, peer-to-four called Tax Amazon, and Council Bill 119-810, the Jumpstart Seattle Plan.

I'll go through the comparison between those two pieces of legislation and then touch on the policy levers that are in play when considering Council Bill 119 or the Jumpstart Plan.

So by way of a high-level overview, The amount of revenue generated from the tax Amazon bill is $500 million on an annual basis.

This compares to $173.5 million from the Jumpstart plan.

I would note, as we discussed last week, that that number only reflects the amount of revenue that central staff is able to estimate with the available data.

There are two tiers, which I'll touch on a little bit further on in the presentation.

that apply differential tax rates to those businesses from $7 million to $1 billion and then $1 billion and higher.

The Employment Security Department who provided the data for the analysis was not able to provide data on businesses higher than $1 billion.

So there's an incremental piece that's about a 0.7% in the higher tier that is not included in the $173.5 million estimate.

Both, actually prior slide, please.

Both taxes are a payroll expense tax, so they're applied to businesses engaging, to the business payrolls for businesses engaging in business in the city of Seattle.

The tax base in the tax Amazon plan is all business payroll above $7 million, and that includes all compensation levels.

The Jumpstart plan, similarly, applies the tax to business payrolls above $7 million and above.

However, as you'll see in the next portion of this table, the tax does not kick in until compensation levels of $150,000 or higher.

And so on that note, the tax Amazon plan applies a 1.3% rate to all non-exempt payrolls.

The jumpstart plan applies two different tiers, one for business payrolls from $7 million to $1 billion.

And then it breaks it further down by level of compensation, $150,000 to about $500,000.

The rate is 0.7%.

For compensation, $500,000 and above, it's $1.4.

Then for business payrolls that are $1 billion and higher, those two tiers are 1.4% and 2.1%.

Next slide, please.

Exemptions are fairly similar between the two pieces of legislation.

Grocery stores are exempted in both.

There are some business categories that are just generally not subject to city tax, including governments, motor fuel businesses, liquor stores, insurance companies.

One point of departure between the two bills is the tax Amazon plan exempts nonprofits.

Jumpstart plan does not exempt nonprofits other than the initial $7 million threshold exemption.

Another difference between the two is the tax Amazon plan has introduced a June 1st, 2020 start date.

The Jumpstart Seattle plan starts January 1st of 2021. And then finally, by way of comparison, there is no sunset clause included for the tax Amazon plan.

The jumpstart plan includes two tiers of sunset.

One is a hard stop on December 31st, 2030 for a 10 year sunset date.

But then also the provision that the future city councils will, an intense statement that they will monitor.

state and county legislative efforts for progressive tax proposals that would overlap with this proposal, and then modify this bill as necessary.

Next slide, please.

So this is a jumping off point for the policy considerations.

There are generally two that are of note.

One is making an impact to the revenue amount generated from the bill.

Obviously, a rate change, either up or down, could generate commensurate levels of revenue increases.

Further exemptions could be added, modified, or removed from the bill with a revenue impact.

The thresholds, so basically the size of business payroll at which the tax kicks in, could be increased or decreased.

Similarly, the level of compensation to which the tax begins to apply could be raised or increased.

And then finally, with regards to the revenue amount, this is more by way of how much revenue could be generated in total versus on an annual basis.

Currently, as stated, there are two different start dates.

If the Jump Start Seattle plan was starting in 2020 as opposed to January 1st of 2021, an additional amount of incremental revenue could be generated.

And then finally, the sunset provision can be modified, removed, or otherwise additional sunset provisions could be added in some fashion.

And that is actually the extent of my prepared remarks.

I'd be happy to help with any questions.

Thank you, Tom and Dan as well for all of your work.

I just combined your name.

Apologies for that.

But we just want to say thank you again for all of the work you've done.

The four of you have been extremely helpful for the various proposals that have been put forward and just want to recognize how much work you're doing in addition to receiving the budget last night from the mayor.

So thank you.

I would call this a revenue-generating bill for the spend plan that we just walked through.

Council members, questions?

Council Member Morales, thank you.

Okay, thank you very much, Dan and Tom.

Dan, I know we've had several conversations about this, trying to understand I'm trying to understand different rates and looking for a way to make this.

Colleagues, I think it's really important if we're going to go through this work of making a substantial change to our taxing structure, that we need to create a much more robust infrastructure and mechanism for doing this.

So I have been talking to Dan about how we could do that.

and trying to understand the four different categories that Council Member Mosqueda's proposal puts forward.

It seems to me that the salary distinction in this proposal is the same in terms of the rate, whether it's 100,000 or 500,000.

I'm wondering if a more, well, progressive approach would be to assess increasing rates based on total payroll.

So in other words, assess the same rate, let's say 1.5% on all salaries over $100,000, but increase the rate.

So between $7 and $100 million, it would be 1.5%.

Between $100 and $500 million, maybe it's 1.7%.

And over $500 million in payroll, it's 2%.

because it's the way it's structured right now.

We know, we don't know how many, but we know there are very few businesses in the city whose payroll might exceed a billion dollars.

Um, and so I'm just, I'm trying to, um, keep the effect of the, uh, incremental rates, but make it more meaningful by having those categories, um, smaller.

and still try to generate substantially more than $200 million a year.

Not really a financial analyst, but this is the general idea that I've come up with to try to get us more revenue and still keep the idea of incremental increases.

So I would love some thoughts on that.

I don't know if you want to step in, Dan, or if you prefer I do.

Please go ahead, Tom.

OK.

Thank you, Council Member, for the question.

So we can certainly tweak the different rates that are applied to the structure as proposed.

As I kind of mentioned at the lead, the fundamental data that we are working with was based off of an initial request.

So there are just kind of similar to how we don't have data for the $1 billion plus category.

We are somewhat limited in how much flexibility we have to do more discrete adjustments within the tiers with the data at hand.

So we could certainly look into that and see what kind of flexibility there is with the data that we have, just understanding that there may be limitations to how much more detail could be applied.

I would just layer in an additional thought that the data we have is from the State's Employment Security Department.

They have given us information about all of the employers and the employees.

What they have had to do is to essentially screen from the public's view, from our view and from your view, some of the information which would have provided would have publicized private information about individual employers.

So we are not allowed to know this sensitive information.

So we have aggregate information that can't be attributed to any individual employer or any individual employees.

What Tom is describing is limitations on how finely we can slice the aggregate data before we begin to tread into this land of being too specific about too few a number of businesses so that a reasonable person might be able to infer which businesses we're talking about.

That is the limitation that Tom was referring to that makes it challenging for us to be able to estimate with any kind of precision the amount of annual revenue which would flow from the kind of more fine-tuned rate structure, Council Member Morales, that I believe you were proposing or offering as a possible suggestion.

Council Member Morales, before you do a quick follow-up, if you have any questions, I think Council President Gonzalez has a question for the central staff based on that response as well.

Thank you, Chair Mosqueda.

I actually think this question is for, I'd like to get some clarification from Council Member Morales, actually.

I wasn't quite following what you were proposing in terms of the rate.

So is are you proposing an increased percentage on a sort of flat rate basis of anything above 150,000 would be subject to a 1.3 or 1.4, whatever the percentage being taxed, just a flat rate?

Is that what you were proposing?

Or are you proposing modifying the current percentages that are listed and proposed as part of the taxation rate.

So keeping the brackets the same, but changing, moving the dials up within those tiers.

Well, I think I'm proposing both, right?

So to me, when I look at this slide, and we're looking at payroll between, for corporations whose payroll is between $7 million and $999 million, that seems like a huge category.

And so it seems to me that if we have one rate, a slightly higher rate, I'm saying 1.5%, for, say, $7 million to $100 million, and then a slightly higher rate for between $100 million and $500 million, that still gets at the progressive nature of trying to tax higher payroll, incrementally higher taxation.

without having quite so many categories, I guess is really what I'm trying to figure out is, is there a way to simplify this and have, you know, like only three rates over different categories rather than four rates over four categories.

But the bottom line is I'm trying to find a simpler way to increase the revenue that we're generating here.

I appreciate that clarification.

And I suppose that if we're looking for a simpler way to do it, it might be just as easy to leave the categories, the tiers the way that they are, and just simply increase the current proposed percentage of taxation based on those existing tiers to see I'm not sure how much more we could generate in revenue.

Obviously, I think the issues that Council Central staff have the level of confidence that they're going to have in those forecasted models.

But I think that issue exists whether we leave the model as it is now and move these dials as they exist or whether we look at models under your suggested revision.

So I just wanted to flag that I think there's still also a possibility to just work within the tiers as they exist and look at moving the existing proposed taxation rates there to see what the model would produce.

Yeah.

Thank you, both Council President and Council Member Morales.

Council Member Morales, last question or comment from you.

I'm sorry to cut you off.

I see you saying no.

That was all my questions, thank you.

Okay, no problem.

And I have Council Member Sawant in the queue.

If there's other Council Members, please do raise your hand.

Council Member Sawant, thank you.

Thank you, Council Member Mosqueda.

It's on the point that Tom was going over and also what Council Member Morales raised.

As I said in the previous set of slides that, you know, just not surprisingly, I would support any and every effort to increase the revenues raised by the baseline proposal that's under consideration right now.

And as I said, Earlier, I'm already planning to bring in an amendment to increase the tax rate.

But I have also been planning to bring an amendment to have the tax apply to all sections of the corporate payroll of a company that is eligible.

And whether a company is eligible or not is not decided on how much they pay their employees, but how much payroll there is overall.

I'm really positively interested that there is an actual discussion of increasing the tax rate.

I hope that councilmembers are serious about this and I really look forward to increasing the amount of revenues raised one way or another because ultimately I think that's what this is about.

It's about Can we have the political will on the council to raise enough revenue to both build the kind of housing that we need, but also on the scale that we need?

And I agree with all the points that Council Member Mosqueda made about making sure that we have zoning codes that facilitate that throughout the city, and also making sure that we make maximum, absolutely maximum use of city-owned surplus land.

All of that is important.

I think it is going to be limited by how much revenues we raise for building affordable housing at the scale we need.

We need a commitment on that.

And in addition to that, to close all the budget gaps that are unfortunately going to be gaping holes because of the recession.

Regardless of how you slice it, we're talking about two extremely progressive proposals because they are both based on the same mechanism, which is taxing corporate payroll.

And just, I wanted to speak as an economist for a moment.

I'm very worried that all of this discussion is starting to, it could conflate on the reality that they are both the exact same mechanism, which is a tax on corporate payroll.

And I would really urge all council members to reiterate this point.

I mean, regardless of which proposal you support, please let's not unintentionally have sort of misleading points, which I've seen before, not today.

And I hope we go forward in a positive direction in explaining to members of the public that they are both They are both taxes on corporate payroll.

Regardless of which section of the payroll you tax, the tax does not fall on the workers or on the employees.

They fall on the business, meaning if the corporation is eligible to pay taxes or required to pay taxes because of the $7 million threshold, then that means that the owners and the major shareholders of that corporation will pay not the employees of the corporation and regardless of which tax rate is applied to which salary of the employees, the employees don't pay the tax, it's the corporation that pay the tax and we need to make sure that You know, we reiterate what economists have said.

Economists have debunked the idea that the Chamber of Commerce has come up with in 2018. They're still recycling that same old idea, false idea that it's a tax on jobs.

I think it's really positive that we are all unitedly talking about a big business tax proposal of some shape or form.

But I just wanted to clarify that regardless of what tax rate is applied to what section of the payroll, this is not a tax on the workers.

I would support any and every avenue to increase the taxes.

As I said, I will be working on amendments.

I welcome any of your offices to work with my staff on that.

I think anything less than the swap morale proposal is progressive and I appreciate you clarifying both for the viewing public this is a tremendously progressive conversation both proposals are progressive and as we continue to talk about drawing those dollar amounts up I think that's what the commenter was trying to get at.

We want to see those dollar amounts increase and so that I can understand from a policy perspective the angle there but just to clarify for the a very exciting time.

And we also should note, as you've talked about before, this has been momentum that has been building.

Folks in the community have been calling for fixing the tax code.

Obviously, this alone in Seattle would not fix our regressive tax system.

Given the regressive nature of taxes in the state as a whole and in our city, that will continue until completely reformed.

But the the building and the call for action has been happening for years, and it's really exciting to hear the conversation today.

I agree with your comments that you just mentioned, and I'm really optimistic that we're going to be passing progressive payroll tax here in the city of Seattle in the very near future.

Any additional comments that you come off of?

Conservative mosquito just to add to what you and I were both saying just to clarify that the corollary point drawn from what I was saying about economists having debunked the idea.

This is the tax on jobs or on workers, you know, flowing from that it implies that I would say regardless of which section of the payroll you tax, it is still a progressive tax, and neither of these taxes are regressive, and I would really hope all council members reiterate the point that these are both extremely progressive tax proposals, and this would be historic because they are both taxing big business, not the workers, and neither of them is regressive.

Excellent.

Thank you.

I agree.

Thank you.

I just want to echo Councilmember Sawant's sentiments around the progressive nature of both of these proposals.

And I think that It is important for us as council members who are supportive of progressive revenue streams to really push back on this narrative that this is somehow a tax on jobs.

That, as Council Member Sawant has stated, implies that somehow this is gonna come out of the paychecks of working people in these corporations, and that is just simply not true.

and I appreciate Council Member Sawant's call to all of us to be extremely direct about that and to really create a strong legislative record here and a record in the public as we are engaging with our constituents that this is a tax that will be paid by large corporations from and not from the bank accounts of working class people.

If we were proposing something that pushed this kind of tax to working class people, I can assure you that we would not be proposing either of these plans.

And so I think it's really important to me to accept Councilmember Sawant's call This is absolutely a tax that is intended to be paid by and that will be paid by large corporations and not by the people that they employ.

I also want to take the opportunity to acknowledge that this is not a novel taxation mechanism.

We have lots of payroll taxes that exist in the state of Washington.

What is novel about this is that we are requiring that it be paid by corporations as opposed to a deduction from payroll checks to further add to the progressive nature of both of these proposals.

And I think it's really important for us to acknowledge the fact that we are not reinventing a tool, but we are being novel in terms of its applicability and in terms of who it's going to create tax liability for.

And that is our city's largest corporations who, under our most progressive tax system that is here in the state of Washington, we are going to require that these corporations pay a fair share of what they owe in terms of taxes that they have not been paying equitably into our taxation system.

So just want to echo that sentiment and want to put my support out there for those principles.

And I know that Council Member Salon is our resident economist on the city council.

can, I'm sure, speak more about the concept of just payroll taxes and sort of the value of making sure that we are being very clear that this is going to be paid by our city's largest corporations.

So thank you, Chair, and thank you, Council Member Salon, for making sure that we are making that crystal clear in our deliberations here.

Thank you so very much.

Both Council Member Swan and Council President Gonzalez for making that clear.

And on behalf of the council and our deliberations here, I hope that leaves no question as to the nature of this tax and the progressive approach that our council is taking to try to right size our revenue to address the crisis that is here.

Council Member Peterson, I see your hand raised.

Welcome.

Thank you for your comments.

Please go ahead.

Thank you, Chair Mosqueda, and thanks, everybody, for their hard work on these proposals.

I wanted to signal my interest in potentially an exemption for nonprofits.

I know we've been talking a lot about the large corporations, and the previous bill had that exemption, so I just want to signal my interest in exempting nonprofits.

I don't know if there would be an interest also in exempting healthcare providers, at least during the first couple of years of this, because they are treating patients with COVID, they're testing for COVID.

So that's another idea.

Wanted to, I guess we're, are we through talking about the spending plan?

Okay, that's fine.

But you're welcome to make comments on that too, Council Member Peterson.

Sure, to the extent that the spending plan Um, and I think as we, as we move forward, um, years, 2022 and beyond create new programs.

I will probably be interested in seeing some sort of language where we're having the city report back to us on the.

It doesn't have to be a full-blown evaluation, but something where we're, what are the outcomes we're trying to achieve and tracking against those outcomes.

And then so that we can do course corrections here.

I know this is not a popular idea among this group, but I'm, I am interested in actually a shorter sunset.

The rationale being that, you know, if there was something like a four year, five year sunset, that would then enable a city council, um, you know, four years from now to, to make adjustments at that time.

Um, whereas the, the 10 years will presume potentially tie the hands of future councils.

And so that, that's just one thought, but I've, I've heard other folks say that they don't want to sunset.

So I'm just sort of throwing that out there as, as, um, as an idea.

which doesn't sound like it'll be very popular with my colleagues, but just wanted to put that out there.

And I might have some other ideas along the way.

I just got through the legislation this past weekend and then was curious to see what Mayor Durkan was gonna be doing for the rebalancing.

So I'm almost finished and we'll be able to meet your deadline for Friday if I have any formal amendments.

Thank you.

Council Member Peterson, I appreciate you flagging that.

I think that it might be helpful if central staff, you have comments about the oversight or reporting back, if you could remind us about what's there.

I'm also a little fogging on that piece at the moment, just given how many things we have on this council's agenda.

That might be helpful.

Council Member Peterson, I appreciate you flagging the nonprofits, and I know Council Member Sawant's hand went up.

I'm not sure if you wanted to talk about that piece.

And okay, please go ahead, Council Member Sawant.

And then I'm sorry, Council Central staff, we'll turn it over to you after that.

I mainly wanted to comment on the question of the sunset clause that was raised by Council Member Peterson.

And I, of course, completely disagree with Council Member Peterson, but I do appreciate that finally, we do have council members who have not spoken at all about the tax, the big business taxes, progressive taxes that we're considering starting to speak up.

And I think that's important because we do, as Council Member Mosqueda, you have stated yourself that We have an interest in addressing the crisis in our city as soon as possible.

We don't intend to sit on this forever.

We want to vote a strong proposal out of this committee and out of the Council as soon as possible.

To that end, it is important that Council members are honest where they stand.

I just wanted to also honestly disagree with the proposal that was made.

I mean, the sunset clause implies that whenever it sunsets, it will force the ordinary people at that time to have to wage a renewed fight for something that should be the norm in our society.

At the very least, progressive taxes should be the norm in our society, not an exception for a short period of time because thousands of people fought really, really hard.

I mean, building movements is hard work.

and the best way for this council to honor the people who have fought for this so far is to make sure that we don't have a sunset clause at all.

Least of all, making that sunset come sooner rather than later.

And I will just say, what needs a sunset in our city is the horrifically regressive tax system, which has had just such historically detrimental impacts on working class people and especially our communities of color, what needs a sunset is the racist gentrification in our society.

What needs a sunset is the affordable housing and homelessness crisis.

There should be no sunset on progressive taxes.

And this is one of the first attempts that is hopefully going to succeed.

But we've had too long of a time in our city and state with regressive taxation.

And that needs a sunset.

Absolutely.

OK, Councilmember Peterson, I also want to say thank you for sharing your comments.

I see your hand raised again.

I do want to make sure that your questions or your comments about the nonprofits and the issue of outcomes.

I think especially the issue of outcomes is a great question.

So if there's not some language in there to build off of, I'd love to work with you on that.

and I'll turn it over to you before we go to central staff to get any answers to that question.

Council Member Peterson, follow up from your side.

Thank you.

Yeah, just to clarify, I agree we need additional progressive taxes.

In a perfect world, we would have a state government that had a progressive income tax.

In a perfect world, House Bill 2907 would have been passed so that we had a regional tax.

I mean, Council Member Esqueda's proposal You know, it has some very good points to it.

I still wish it were a regional tax.

For me, the sunset is more of an opportunity to revisit what's going on at that time, to renew it.

It's not to have it close out, especially if the state hasn't done anything since then.

I know that there is the language here that's put in the bill to so-called maintaining a level playing field, section 5.38.100.

I mean, maybe there's a way to tighten that language up, but for me, the sunset was just a way to see, okay, what has the state done?

Have they done anything?

Has King County done anything?

It wasn't related to shut off progressive taxes at that time.

So thanks for letting me clarify that.

Absolutely, that's very helpful clarification.

Council Central staff, did you have anything you wanted to add about any of the outcomes for performance metrics or any follow-up questions on the non-profit issue as well?

Allie, please, go ahead.

To the question about reporting, can you hear me?

Oh, yes, now I can hear you.

Okay.

I will just note that the spending plan proposal for the Jump Start Seattle plan that establishes the payroll tax oversight committee notes that the purpose of that oversight committee is to provide oversight on the services and programs supported by the payroll tax and the impacts of this tax on the number of jobs and businesses in the city and other data that directly reports to measuring the impacts of this tax on the city's economy.

The oversight committee shall provide an annual report that provides this information to the mayor and city council.

Generally speaking, the intent is that they're also asked to create an implementation plan that might get more into more details about what those metrics actually are.

But I would be happy to talk with you, Council Member Peterson and Council Member Mosqueda and others, if you want more specificity in this proposal to provide guidance as they develop the implementation plan and stand up an oversight board or committee, excuse me.

Council Member Peterson, any follow-up from you?

Just that, thank you, Allie, for that.

I did read the section on the oversight committee and having been involved in some oversight committees, I know that typically they're dealing at a very high level, information's coming to being presented to them.

And whereas what I'm saying is if there are individual programs that are created, they should bake in there some mechanism to say, okay, This is a new program.

What are the outcomes we're trying to achieve to benefit people?

And are we tracking them so that they can then report to the oversight committee and have that data ready rather than the oversight committee coming in later and saying, did you track this data?

Did you ask these questions?

And it's too late by the time the program's up and running.

So it was just a nuance there on how program specific to be on the evaluation stuff.

great.

That's great.

Thank you so much Councilmember Peterson.

Looking forward to hearing more about that idea as central staff works on that with you.

I believe I saw Council President Gonzalez's hand if you had a comment and then I saw Council Member Sawant's hand as well.

Anything from you Councilmember Gonzalez?

Okay, I see.

No.

Councilmember Sawant, any last comments here?

I just want to flag for folks, I don't see any other hands.

So we're getting to the closing comment period as we have eight minutes left in this section of our agenda for this morning.

Okay, I don't see any other videos coming online.

So Councilmember Sawant, coming back to you for some closing comments as well.

Yes, I just wanted to say I think it would be truly historic if this council passed a strong Amazon tax very soon, hopefully this month, and I would be really excited to help make that happen.

And congratulations to the people who have fought this far, but we cannot relent, of course.

I really want to urge everybody who has fought for this to continue fighting because we know the Chamber of Commerce is still mobilizing against it.

We saw what they did in 2018. It's extremely important that we keep organizing.

I wanted to invite everybody to our People's Budget Town Hall, which is happening online tomorrow, not at Cal Anderson, but online at 6 p.m.

tomorrow, so please join us.

And just really quickly, I will say that we need to, the only amendments that I believe should pass to the baseline legislation that is under consideration is to strengthen the amount of revenue that can be raised through taxing big business, and to remove the sunset clause.

And I'll just note to clarify that city councils, at any given time, any city council has the right to terminate taxes in future years.

We don't need a sunset legislation to give them that authority.

They have that authority by being the highest legislative body of the council.

And if we're going to have any clause Why don't we have a sunrise clause that would double the progressive tax in four years if the crisis has not been made a dent in?

Or how about having this tax sunset when the taxes on working people, like sales taxes, are lifted?

I'm just saying that there are various options that we can consider for sunrise or sunset, but the one that is in the legislation I think needs to be removed and certainly shouldn't be shortened.

Thank you.

Any other closing comments from folks?

I will say thank you to our central staff who I see are still on the line.

Thank you for walking us through this.

Before we close, any other questions that central staff have for us?

Okay, I'm not seeing any other team put their video on.

Any questions, Ali?

No?

Okay, no questions from Tom?

Okay, great.

So colleagues, we've heard a number of issues that I think folks will continue to look into.

Appreciate all of you flagging those issues.

And I think that there's a handful that really perked my interest.

So I'll be following up with some of you as individual council members to hear a little bit more.

I know that central staff is going to be providing for us any amendments that they can based on your feedback today.

And if you have other ideas and want to provide additional clarification, again, according to the calendar that we sent around, amendments are due at 10 a.m.

on Friday.

So thank you for your proactive conversation today to identify these issues.

I think there's a lot of commonality, a lot of interest in making sure that we address the crisis that is COVID.

and also that we invest heavily in the out years in small businesses and in housing supports and true economic revitalization and equitable development.

So today was a very productive conversation.

I want to thank you and really signal my support for all of you as you think about possible strategies for our deliberation next week.

I also want to thank our central staff in each of your offices.

I know you have a lot on your plate right now, and you've been heavily engaged with our office and central staff.

So thank you for carving out time to provide feedback on this legislation.

We are really looking forward to the robust discussion about amendments.

So please do send those in on Friday by 10 a.m.

And thanks again to our central staff.

The next vote, next conversation that we have is a possible vote on amendments and possible vote on the underlying bill with those amendments for next Wednesday.

I look forward to talking to you this afternoon.

Our committee calendar, our committee discussion continues this evening.

Okay, not this evening, this afternoon at 2 p.m., where we will get an overview of the mayor's proposed budget, and we will start with getting follow-up questions from the first iteration of our SPD inquest into their budget process.

That again starts at 2 p.m.

today, so we are going to pause this committee This concludes our session one of the budget committee discussions, and if there's no objection the committee will be in recess until 2 p.m Okay, enjoy your lunch everyone.

Thank you for all of your work Thank you