Last week, I featured Seattle City Councilmember Dionne Foster in an item headlined “Inclusionary Zoning > No Inclusionary Zoning” to reflect her progressive affordable housing stance. However, according to a comprehensive new academic study, she has it backward.
No Inclusionary Zoning > Inclusionary Zoning
So says the study released this summer by an economist at UC Irvine about inclusionary zoning (IZ), a policy that requires builders to couple any market-rate housing they build with affordable housing. Seattle’s version of this—as in Foster’s resolution calling for inclusionary zoning requirements in residential areas where the policy doesn’t currently apply—uses a “fee in lieu” model where developers can pay into an affordable housing fund instead of including the affordable housing in their own projects.
Unlike other (inconclusive) research on IZ, the UC Irvine study had a clean before-and-after look at the policy, thanks to California’s unique history of going through a period when inclusionary zoning (including the fee-in-lieu model) was legal, illegal, and then legal again.
The study indicates inclusionary zoning does the opposite of what it’s intended to do, finding that IZ makes it more expensive to rent. California renters paid approximately $6.97 billion in additional rent in areas with IZ mandates. So, even as IZ funds some affordable units, it comes at a steep cost to renters, including low-income renters, who aren’t “lucky enough to get an IZ unit,” according to the study.
But the real zinger: The study then compared that rent increase to the number of affordable units created and found that it wasn’t worth the tradeoff. As the author bluntly states in the opening summary: “I estimate the cost of generating an affordable unit with inclusionary zoning to be approximately $800,000 in ‘excess rents’ paid by market rate renters as a result of the policy’s constraint on supply. This exceeds the cost of directly incentivizing the creation of low-income housing [~$441,00 per unit] in California through existing programs.”
Seattle’s Budget = Amazon’s Stock Price
Speaking of being blunt, Erica didn’t hold back in her report on Mayor Wilson’s $2.5 billion budget proposal last week. And I quote: “JumpStart is Basically Just a Slush Fund Now.”
JumpStart, of course, is the 2020 tax on high-end salaries proposed and passed by former lefty city councilmember Teresa Mosqueda to pay for affordable housing and other progressive priorities. Now, according to a recent economic study commissioned by Seattle’s own Office of Economic Development, it increasingly covers the city’s regular budget shortfalls. Since 2024, when a newly elected city council majority changed the law to eliminate the original JumpStart spending plan, more than half of JumpStart revenues are used to cover the gap between city budget expenditures and general fund revenue.
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I’m not here to cry about that. True believers like me have lost that fight. But here’s a problem with budgeting-by- JumpStart that everyone should note: The report found that “Seventy-five percent of JumpStart revenue comes from just 10 companies.”
This is emblematic of Seattle’s worrisome status as a one-crop town (big tech). “In summary,” the report states, “the city’s fiscal health now depends on the marginal location and compensation decisions of a handful of employers. It also depends, indirectly, on the stock prices of those employers.”
Zeroing in on the city’s largest company, the report continues: “When Amazon’s stock rises, Seattle’s tax base rises with it; when it falls, the base contracts. (Amazon’s stock price alone has ranged from roughly $85 to $245 over the past three years.) But it means that a fiscal base already concentrated in a few firms is further exposed to the single most volatile attribute of these firms—one the city has no ability to forecast or influence.”
Existing Third Places > New Startups
Wilson explicitly acknowledges the challenge by incorporating her recent “Resilient Economy” executive order into her budget proposal. Seattle has “become increasingly concentrated on the tech sector,” the EO states. It commits the city to convene a task force “to develop and implement strategies for diversifying and growing Seattle’s economy.”
And while the specifics of the order focus on making it easier to establish and maintain businesses in fields that are growing, that strikes me as being more top-down than middle-out. As I noted a few weeks ago, the thing that makes Seattle attractive to the talent needed for new startups are third spaces—i.e., existing businesses.
I wish Wilson’s proposal did more for the bars and restaurants and coffeeshops that are already permitted, but increasingly struggling: 67 percent of brick-and-mortar, small, independent businesses told OED they are under more financial stress than during the pandemic. “[Seventy-one] percent reported lower foot traffic than a year earlier, and only 12 percent said customer demand was sufficient to cover their cost structure.”
This is the first year the police budget has exceeded the half-billion dollar mark, reflecting a new contract that boosts starting salaries for newly minted officers well into the six figures. Officers with college degrees get additional premium pay.
An early look at how the council is reacting to the mayor’s deficit-busting budget.
By Erica C. Barnett
Last week, I described Mayor Katie Wilson’s first budget as “small-c conservative,” because it eschews most of the budget tricks of recent years and achieves balance through 2030 not by raising taxes, but by eliminating positions and deferring spending. It also relies heavily on the JumpStart payroll tax—originally created as a source of additive spending on affordable housing and other progressive priorities—to backfill the general fund.
Business groups agreed with my assessment, praising the budget as “a thoughtful approach to a difficult fiscal challenge” (Joe Nguyen, head of the Seattle Metro Chamber of Commerce) and an “important” example of “fiscal discipline” (Jon Scholes, head of the Downtown Seattle Association). The head of the Washington Hospitality Association, quoted in the Seattle Times, said the group was “pleased to see no tax increases, and we’re also pleased to see an increase in the number of police we’ll see on the streets.”
But there’s one group that seems to absolutely hate the mayor’s budget: The centrists on the City Council, who spent last Friday’s daylong public safety budget meeting painting Wilson as a “screaming” police abolitionist, obtusely mischaracterizing efforts to cut spending by not funding vacant positions, and suggesting that Wilson should have dramatically boosted police spending to levels completely inconsistent with budget realities.
The biggest of those realities: A $175 million deficit built into the budget these same council members approved last year. As I reported at the time, that budget, proposed by former mayor Bruce Harrell and expanded by the council, “relies heavily on budget tricks to remain balanced for 2026, tumbling immediately into nine-figure deficits in 2027 and beyond.”
Even as it eliminates those annual deficits, Wilson’s budget fully funds 66 new police officers who were hired in 2026 but whose positions were not funded in Harrell’s 2026 budget.
It also includes funding, in 2027 and 2028, to get SPD to a total of 1,250 officers, the goal set by SPD’s own staffing plan. Wilson’s budget office director, Aly Pennucci, told me last week that she expects SPD will hit that number on schedule sometime in 2028 and stick to roughly the same number over the two years after that. SPD will lose some vacant civilian positions—unfilled but funded jobs they’ve historically used to pay for other priorities. And they aren’t slated to gain net new officers beyond those 1,250 after 2028, although that could change two years from now, when the 2029 and 2030 budgets are actually on the table.
Despite some headlines characterizing Wilson’s budget as an almost 14 percent “expansion” of SPD, new hires represent a fraction of the added spending. Most of the new obligation—$56 million—is mandated by the police union contract negotiated by former mayor Harrell and signed by a majority of the current council. Another chunk, nearly $13 million, pays the full cost of new officers hired in 2026 (most of whom didn’t work a full year last year, since they were hired at various times), plus any additional officer hires needed to get SPD staffing up to the 1,250 goal.
Though modest compared to some councilmembers’ expansionist ambitions, those new hires are real, and represent a commitment to adding more police to get the department to the goal it established for itself.
To listen to the tirades coming out of City Hall on Friday, though, you’d have though Wilson was taking a chainsaw to the police budget, or perhaps going across the street and yanking badges and guns away from officers herself.
Public safety committee chair Bob Kettle kicked things off, fulminating that Wilson’s budget really should have funded 150 more officers a year, since the city will “have to have 1,800 officers in our city with population growth” by 2050. (As an aside, although this simplistic officers-per-capita ratio is popular among politicians and many individual police chiefs, the International Association of Chiefs of Police does not recommend calculating police spending this way, because it can lead to redundant and unnecessary hiring.)
“It seemslikewe’vegivenuponthegoalofreaching1,400plus,whichisreallytheminimumthatweneedtohaveforofficers,” Kettle said, directing his comments at Pennucci. “Infact,theproposedbudgetfor2028isasustainingbudgetthathaszeronewnethires.Andshouldwe,asacouncil,interpretthistomeanthemayor’sofficenolongerwishestogrowthesizeoftheappointmentlongterm?” Pennucci, in what would become a refrain, explained that hiring 150 net new officers over the next to years is not a goal “grounded in financial reality.”
Put another way, if the city council wants to spend another $30 million or so hiring an additional 150 cops, they’ll have to come up with $30 million in cuts to other departments and city services. Where is that going to come from? No one who complained about the proposed police budget on Friday, including Kettle, Rob Saka, Debora Juarez, and Maritza Rivera, offered any suggestions.
Nor did councilmembers explain how (or why) the city should continue funding nine long-vacant parking enforcement officer positions, which Wilson’s budget eliminates—while retaining funds for six other vacant PEO positions. Both Rivera and budget chair Dan Strauss were optimistic that a new contract with the PEOs, who start out at around $36 an hour, will result in filling the vacant positions; Rivera said PEOs are necessary to enforce the law against “illegal activity” going on inside RVs (actually SPD’s job), while Strauss said a lack of parking enforcement will lead to lower “turnover” in popular areas as people overstay parking limits designed to ensure plenty of spots are available.
Another item councilmembers said should have been somewhere in the budget, but isn’t, was police surveillance cameras in Seattle Center. Harrell himself never proposed adding police cameras at Seattle Center. Instead, it focused on surveilling areas with high rates of specific crimes, including violent crime, drug sales, and prostitution. Despite councilmembers’ insistence that only cameras can prevent (or help police investigate) the next Bite of Seattle-style tragedy, Seattle Center is not some murder hot spot. In fact, in searching the Seattle Public Library’s online media database, I could find only one homicide at Seattle Center, in 1967; two other shootings, at Folklife Festival in 2008 and on another occasion in 2012, resulted in nonfatal injuries.
Nonetheless, council members demanded to know why Wilson’s budget failed to fund cameras all around Seattle Center in anticipation of the next mass shooting there. As I noted on Bluesky, politicians tend to be very good at responding to the last crisis as if the exact same scenario is likely to occur again. This is why we all have to take our shoes off and dump out our water at the airport, even as the TSA fails to detect actual weapons the vast majority of the time.
Rob Saka led the charge. After a little Socratic back-and-forth with Sayles to confirm that, yes, the police chief agreed that more police cameras would have helped the still-ongoing investigation into the July shootings, Saka—who talked uninterrupted for 18 minutes—said he found the “omission” of new cameras at Seattle Center “extraordinarily difficult to understand and incredibly disappointing.”
Specifically, Saka continued, he was shocked that the police had to rely on footage from bystanders and businesses as part of their investigation.
“Here’s the key contradiction,” Saka said. “After a deadly shooting at one of the city’s most important civic campuses, the Seattle Police Department had to to seek video evidence, footage from tenants, businesses, visitors, and people—pulling cell phones! We’re asking our investigators to essentially pass the hat for simple video evidence after tragedy strikes! Begging, borrowing, pleading, passing the collection plate for simple, simple evidence. Apparently, everyone can have a damn camera in the city, except the city itself!”
Two quick fact checks. First, there are cameras at Seattle Center and they were on. Second, asking for cell phone footage has been a routine aspect of police investigations since at least the advent of the iPhone two decades ago. More on that in a moment.
This was the second time that Saka had demanded to know why the city wasn’t funding cameras at Seattle Center. The first time was at a Parks budget briefing the previous day, when he demanded to know the department’s “plan to install the permanent infrastructure and keep those cameras on at all times, given the main-event threat at Seattle Center?” As chair of the council committee that oversees the Seattle Center Department, it was a little strange that Saka addressed these questions to a staffer in a department with no control over Seattle Center or its budget.
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On Friday, Saka said the city couldn’t say “with a straight face” that “we’re advancing a responsible budget and carrying out our charter responsibility to keep people safe without funding for critical CCTV cameras at the Seattle Center. … When we do that, the public understandably feels like they’ve been hoodwinked. They feel like they’ve been bamboozled, snookered, hornswoggled, duped, swindled, played, hustled, tricked, fooled, misinformed, led, punked, sold a bill of goods.”
Rivera, piling on, said it was “embarrassing that we have to ask the public for their camera footage because we’re refusing to put cameras in places where they need to be, so that when crime does happen, we’re able to solve crime and provide answers to the folks that have been hurt by these crimes.” Whether cameras “need to be”
“We do ask people for their personal footage in order to solve crime. That does not make any sense.”
As I mentioned, asking the public for video footage and using footage from nearby businesses is a routine, standard, and probably universal practice among police departments investigating major crimes committed in public. It’s impossible for police to replicate the near-total coverage of public events that smartphones and business security cameras provide access to; attempting to do so would involve a Panopticon of surveillance cameras so total it would blow the current police budget out of the water.
No Seattle elected official has ever publicly proposed eliminating this essential investigative practice, to my knowledge, until Saka and Rivera did last week.
But the council’s departures from reality didn’t end there. (And I’m not even counting Dan Strauss’ repeated comments about how he “reinflated” his collapsed lungs when he was hit by a car in 2004, something he said he learned to do after falling off the monkey bars a bunch as a kid. This came in the context of a later discussion about a proposed reduction to Fire Department overtime, which—you know what, let’s just keep it moving)
First, Rivera clocked a $500,000 reduction in spending on three (of nine) vacant analyst positions at the Real Time Crime Center, where police monitor surveillance cameras and analyze footage, and said it looked like Wilson was “eliminating” the RTCC altogether. In fact, SPD budget director Dan Eder explained, the six new positions would still enable SPD to expand RTCC staffing from the current 15 positions to 21, enabling the center to operate 24/7 for the first time.
Not to be outdone, Debora Juarez—a former elected councilmember who was appointed to serve out Cathy Moore’s term when Moore quit the council less than two years into her term—accused Wilson of submitting a “political” SPD budget aimed at “defunding” SPD.
“I’mnottryingtomakethispolitical. I’m trying to make it factual,” Juarez said. “IwantSPDtoknowthatwesupportyouandwhatyou’redoing. … Andyes,weallinvestandwillcontinuetoinvestandsupportallupstreamprograms, diversion,absolutely.”
“Butagain,” Juarez continued, “Ihaveahardtimebelieving—becauseIwatchedthismayorscream ‘defund,’ comehere, inhere,andscream ‘Defundthepolice! Abolishthepolice!’SoI have a hard time believing thatsomehowsomeofthisontheexecutivebranchisnotpolitical,andIthinkthat’soffensive,andit’snotfair,anditain’tright.SoI’llleaveitatthat.”
Wilson did not scream “abolish the police” (or anything else) at the council in 2020; despite efforts to portray her as “angry” and “loud,” she is congenitally quiet and low-key. She did testify in favor of the Solidarity Budget, which her group, the Transit Riders Union, was supporting. In her testimony (around 37:30), she expressed support for hand-washing stations, a women’s shelter, funding for sidewalks, and “extending the police hiring freeze through 2021.” She did not “come in here”—council chambers—to say any of these things, because in 2020, all the council’s meetings were virtual because of COVID.
During the afternoon half of Friday’s meeting, Rivera said repeatedly that Wilson’s proposal to fund focused deterrence—a strategy that combines resources for young men likely to commit gun violence with swift arrest and punishment for those who do—was not actually focused deterrence at all, and that the mayor was using the term incorrectly to describe a “random” suite of gun violence strategies.
But her claim, like Juarez’ recollection of Wilson standing in council chambers and screaming “Abolish the police!,” was untrue. Wilson’s office confirmed that the mayor’s focused deterrence commitment will absolutely include both service providers and police; the divergence between the mayor’s plan and Rivera’s is that Wilson wants to consider other vendors besides the consultant Rivera has been aggressively pushing, the National Network for Safe Communities, to do that work. Rivera’s plan would add $414,000 to the two-year budget.
Friday’s budget meetings, which also included discussions of deferred hiring for the CARE Team and cuts to overtime at the Fire Department, felt like a turning point for the city council. No longer are they merely griping that the mayor’s office doesn’t consult them before making decisions (a legitimate, if overused, complaint). Now, they’re making up their own facts to fit a narrative that’s out of step even with the city’s conservative business community—painting Wilson as a radical, screeching leftist in the face of a budget characterized by fiscal discipline.
Maybe the council has just gotten too comfortable signing blank checks, and forgotten that even the city eventually has to balance its checkbook. What remains unclear, because no one on the council has even broached the topic, is how Kettle, Strauss, Hollingsworth, Saka, and Rivera plan to add tens of millions in new spending to this year’s budget without decimating departments that are already taking cuts. It’s early for predictions, but I’m guessing they’ll rely in part on the same strategy they used throughout Harrell’s term—pushing the budget pain just past the horizon, by piling up deficits in “out” years when they may be somebody else’s problem.
The proposal makes real cuts to close a $175 million gap—and reflects the conflict between campaign ambitions and a budget deficit that has gone unaddressed for years.
By Erica C. Barnett
Mayor Katie Wilson’s proposed 2027 budget (announced earlier this week, while I was out of town) would accomplish something that her predecessor, Bruce Harrell, never really attempted: It would close the city’s $175 million structural budget deficit, created largely by the use of one-time funds to pay for ongoing new programs in every budget since 2020. And it would do so in a transparent, sustainable way—by actually cutting departmental budgets, eliminating 128 mostly positions (all but 15 of them vacant), and by foregoing many of the budget tricks that Harrell used to create on-paper balanced budgets that in fact were deeply unsustainable.
What Wilson’s budget does not do, with a couple of notable exceptions (increased shelter funding, new public restrooms, and cuts to civilian police position), is strongly reflect many of the values that got the mayor elected, including a commitment to police alternatives, taxing big corporations, and funding not just hundreds but thousands of new shelter beds.
In particular, it includes no new progressive revenues and heavily relies on the existing JumpStart tax to supplant programs that were previously paid for through the general fund—including $65 million in existing homelessness funding that will now come out of JumpStart. It eliminates funding for long-vacant positions, ongoing new programs for which Harrell and the council used one-time funding, and some of Harrell’s pet-priority projects, like graffiti removal and AI.
The plan has earned Wilson praise from the business community, and from some in Seattle’s conservative and right-wing press. It is small-c conservative in a way that Harrell’s spendthrift, please-everybody budgets never were. It’s possible that many of Wilson’s most hard-core supporters will rally around this budget even though it further institutionalizes the repurposing of JumpStart and other policies that progressives roundly criticized Harrell for, simply because they’re coming from Wilson.
In some ways, it may have taken Wilson—a heterodox housing and transit activist who the mainstream press loves to refer to as an “avowed socialist”—to propose this budget. The council, which overloaded last year’s budget with spending restrictions designed to lock Wilson in to their priorities, will almost certainly have a field day with it, piling on new spending while insisting (as budget chair Dan Strauss did on Thursday) that their budgets have always been sustainable. But if the council decides to knock Wilson’s budget, which is balanced through 2030, out of balance, it will be on them, not her.
I’m going to focus on some of the highlights of the budget, which the city council took up today at an initial high-level today. I’m also focusing on changes to the budget that haven’t been previously announced. Previously announced changes include funding for universal free meals at schools; funding to enforce the city’s ban on residential junk fees and on algorithmic grocery pricing; funding to accelerate shelter construction; funding for a new city prosecutor to pursue extreme risk protection orders and the return of $127 million in city funding for homelessness programs from the King County Regional Homelessness Authority, which I’ve covered elsewhere.
Lots and lots more to come; these are just a few things that jumped out at me as I took a first look at the 735-page budget book.
JumpStart is Basically Just a Slush Fund Now
JumpStart—a tax, paid by businesses, on the compensation of highly paid workers at large companies—was originally supposed to provide additive funding for affordable housing, green jobs, and equitable development, all areas that were related to the spike in Seattle’s cost of living due to the recent influx of high-paid tech workers. Instead, since it passed, every mayor has used a growing portion of the JumpStart fund to pay for basic city needs—which of course means less money for the emerging needs JumpStart was created to address. Wilson’s budget is no different.
Wilson’s budget takes $173 million out of JumpStart to supplant general-fund spending unrelated to the four JumpStart priorities, plus another $65 million to pay for homelessness programs that were previously paid for out of the general fund. The budget counts the existing homelessness programs as “JumpStart” priorities, which is technically true, but because they’re existing general-fund programs I’m going to add them to the $173 million, to get a total of $238 million that Wilson is proposing to takes out of the JumpStart bucket.
Overall, Wilson’s budget repurposes a whopping 59 percent of this year’s $402 million in JumpStart revenues for general-fund purposes. However, because the budget also grabs $43 million out of a fund balance JumpStart has left over from previous years, plus $8 million in earnings from JumpStart fund investments, that total could also be calculated at around 52 percent—still substantially more than the 38 percent Wilson’s budget claims by counting the shifted homelessness programs as essentially new JumpStart spending. (Wilson’s budget uses another large JumpStart balance transfer in 2028, but the fund starts to grow again the following year).
“No More Public Safety” (will be the KOMO headline when they figure this out)
Police spending is projected to grow this year, but not because the mayor is proposing to substantially increase hiring. As we’ve reported, SPD has been put on notice that it needs to slow hiring even as applications pour in from people attracted by huge starting salaries, and Wilson’s budget eliminates temporary hiring bonuses adopted after hiring dropped in 2020; it also cuts millions in funding Harrell added for ridiculous macho recruiting ads.
The biggest cost increase in the SPD budget is a $56 million in wage and benefit increases from the Seattle Police Officers Guild contract Harrell and the city council agreed to last year; that contract, as we’ve reported, boosts the salaries of newly hired cops well above six figures.
The rest of the increase, about $12.6 million, will pay for 66 net new officers who were “hired in 2026 but only partially funded” in Harrell’s 2026 budget, plus funding for two SPD mental health professionals that Harrell’s budget only funded for nine months of this year (speaking of unsustainable budget tricks). The budget essentially calls for capping the number of police officers at 1,250 after 2028, a figure that will unquestionably surface as an issue during the budget process, when the city council has a whack at the budgey,.
SPD’s budget also goes down in one area where Harrell allowed it to balloon unaccountably: The police chief’s office, which former chief Shon Barnes expanded dramatically by establishing a cadre of new positions, each more elaborately titled than the last, will lose three positions. Barnes’ Chief Communications Officer (FKA communications director) Barbara DeLollis and his Executive Director of Crime and Community Harm Reduction Lee Hunt left earlier this year. Alex Ricketts, Barnes’ chief of staff, is still a member of SPD’s command staff, while Andre Sayles, one of Barnes’ two deputy chiefs (most chiefs have just one deputy) is now interim police chief.
Overall, the budget provides funding for 1,866 positions each year through 2030—24 fewer, thanks to cuts to mostly vacant civilian positions, than last year. These positions include parking enforcement officer jobs that have been unfilled for years; PEO jobs are perennially hard to fill because they pay relatively poorly and are high-stress, which is one reason why cutting the empty positions does not actually mean cutting back on parking enforcement.
What it does mean is that SPD will lose some of the funding it uses for other purposes, in an annual sleight-of-hand that is not visible in budget documents. Although the department gets funding for overtime, they routinely use more than they ask for at the beginning of each year; to make up this predictable shortfall, the department uses SPD’s funded but vacant positions to pay for their overspending. (Further routinizing this lack of spending restraint, SPD routinely asks the council to add more money to the department’s budget later in the year as part of a less-visible “supplemental” budget process.) The budget’s $6.5 million or so in civilian savings, in other words, is also $6.5 million SPD can no longer use as a slush fund to pay for overtime; if these reductions become part of the budget.
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Just about every other department takes cuts to vacant positions in Wilson’s budget, but SPD’s are the most likely to raise objections from the council. Councilmember Bob Kettle was already fulminating against them at the council’s initial budget briefing on Thursday.
Council members also signaled Thursday that they have big questions about Wilson’s decision to reduce funding for the Community Assisted Response and Engagement (CARE) team to defer funding for 14 new crisis responders, the previously planned expansion for this year. (The budget doesn’t propose eliminating any of these positions).
CARE is also taking over a bunch of gun violence prevention initiatives from the Human Services Department as part of the gun-violence plan Wilson announced last week.
CARE department Chief Amy Barden said in the past that the 34-member team has had challenges filling its time because of excessive restrictions in the SPOG contract (CARE team members were told not to respond to a crisis in a grocery store parking lot, for instance, because of a contract provision saying they could only respond to crises that occur on publicly owned land), but has said in recent months that SPD has shown more willingness to allow the team to respond to the type of calls for which it was explicitly created. Wilson’s budget also eliminates funding for nine vacant 911 call taker positions, another potential point of conflict with the council.
The proposed budget also cuts overtime at the Fire Department by $7 million, requiring “the department to manage staffing within available resources.” Expect council fireworks over this one as well.
A few little things that could become big things
Stuff to look out for as the budget conversations go on this fall:
• The Seattle Department of Transportation’s budget is seriously out of whack, thanks largely to revenue shortfalls in SDOT’s Transportation Fund and Transportation Benefit District fund that I’m sure will get explained in more detail when the council discusses the department’s budget.
Transportation fund revenues have been declining every year. In Wilson’s budget, declining revenues in these two funds translate into cuts to both new capital projects and basic maintenance, as well as a shift in funding for “high priority” projects, like sidewalks and curb ramps, to the city’s automatic traffic camera program, which is expected to bring in more revenues once it expands to include automated speeding cameras (in addition to cameras that red-light and other traffic violations). The budget also increases taxes for parking in commercial
• Wilson’s budget proposes eliminating an awful lot of council (and mayoral) adds from previous years, which will undoubtedly rub some councilmembers the wrong way. For instance, the budget for the Parks Department cuts seven new positions the council added last year; I’ve asked the budget office which positions these are, but the possibilities include two anti-graffiti staff and three new park rangers. The budget would also cut some vacant positions on the Unified Care Team, which removes homeless encampments; Harrell and the council have repeatedly expanded the team and the council placed a restriction on the budget last year that makes it nearly impossible to cut the size of the 116-member team.
Wilson’s Parks budget also eliminates $500,000 in “discretionary graffiti funding”; Harrell, by his own admission, was absolutely obsessed with ridding Seattle of graffiti, and the word “graffiti” appears 71 times in his 2026 budget, compared to six times in Wilson’s.
The budget would also cut $500,000 Harrell added to last year’s budget for an AI system that was supposed to “streamline the permitting application process and improve customer services using Artificial Intelligence and data integration.”
• There’s also a new $500,000 for the (still troubled, from the complaints I continue to hear) Workday payroll system—this time, to pay for “surge” tech support to deal with changes to labor union contracts in real time. You would think that things like pay increases and classification changes could be handled by the city’s very large citywide and departmental HR staffs, but this is Workday we’re talking about.
Construction workers packed city council chambers last Friday, September 18, to support city councilmember Dionne Foster’s tax holiday on housing development.
By Josh Feit
Councilmember Dionne Foster > Mayor Katie Wilson
You couldn’t have a clearer juxtaposition. Mayor Wilson tried to cut a deal between housing developers and the affordable-housing left to accelerate housing production. And Councilmember Dionne Foster tried to cut a deal between housing developers and the affordable-housing left to accelerate housing production. Wilson put it off.
The city currently has an affordable housing program known as Mandatory Housing Affordability (MHA) which makes developers either add affordable housing to their projects or pay into an affordable housing fund whenever they build new projects. Ironically, the MHA program seems to have slowed housing production. Since MHA kicked in back in 2019, housing applications are down 94 percent and permits issued are down 66 percent. This means less housing supply, which increases rents for everybody—while also bringing in less money for affordable housing. To get production going again, developers wanted to cut MHA fees by 80 percent for two years on projects that are already in the pipeline but have stalled due to the fees. Their argument: A smaller fee on some production will generate more money for affordable housing than a hefty fee on minimal production.
Wilson’s efforts ended with a plan to convene a task force (with a goal of cutting a deal on the fees in early 2027). Enter Foster. She brought the parties together and surfaced math that showed two things: MHA revenues had dwindled to a minuscule portion of the Office of Housing’s affordable housing budget (6 percent down from 39 percent a few years ago) and millions in revenue were being left the table from unrealized development. Developers estimate that lowering the MHA fee would trigger about $24 million in affordable housing funds by greenlighting projects they already have cued up, but can’t move forward thanks to the fee. This is millions more than the anemic $11.7 million MHA has brought in so far this year at the full fee, and down from $67 million in 2020, before developers started forgoing projects.
That would also bring in an estimated $225 million in new construction sales tax and create up to 6,700 new units. Oh, and it would create new construction jobs, which is why labor packed a meeting of Foster’s housing committee on Friday to support her legislation to lower the fee by 80 percent for two years.
Despite the obvious boon for affordable housing, you still can’t convince the left that developers should get tax breaks. And so Foster’s deal—which, of course, still has to pass—includes keeping the full MHA fee in place on any new projects in vulnerable neighborhoods such as Beacon Hill, the Central District, and the Chinatown-International District where development is often considered synonymous with displacement.
It’s worth noting, though, that almost all the projects developers are trying to get moving again under the 80 percent discount are on vacant lots or lots that aren’t currently residential.
Wilson applauded Foster on her proposal. From the sidelines.
Inclusionary Zoning > No Inclusionary Zoning
So says Foster herself, who has added a resolution to her MHA-holiday ordinance clarifying that despite the temporary reduction in the MHA rate, she believes developer fees need to be a “core part” of the affordable housing equation in the future. Using developer fees to fund affordable housing is known as “inclusionary zoning,” a policy that conditions issuing permits for market-rate projects on the production of affordable housing.
Foster’s resolution calls for adding inclusionary zoning requirements in neighborhood residential zones—formerly single-family zones—that are currently exempt from MHA fees. Her resolution directs staff to “develop legislation implementing an inclusionary requirement for new market rate residential development in Neighborhood Residential zones … [and] estimate how an inclusionary requirement for new market rate residential development could … contribute to meeting the need for housing affordable to lower income households.”
This startled some urbanists who cheered her MHA holiday ordinance, but then wondered why she’d do a 180 by adding the fees where they currently don’t exist. Given the slumping post-MHA housing production numbers, urbanists ask why Seattle would tax something its wants to encourage—housing.
Foster, who wants to be “transparent that [her] vision” supports inclusionary zoning, says she doesn’t believe MHA is solely responsible for the falloff in housing production; she cites Trump’s tariffs, for one. However, she also says she wants to make sure the fees don’t stall development and wants staff to “recalibrate” MHA fees “to find the right balance.” (As Erica reported last week, Foster differentiates her resolution from a council proposal last year that would have simply applied the MHA fee structure as is.)
“Right now we are doing a short-term fee reduction to help get development back on track in the midst of lots of negative macroeconomic factors we weren’t facing a decade ago,” Foster said when asked about the seeming contradiction in her approach. “And as we look towards the future, I believe inclusionary zoning should continue to be a part of how we build a city that works for everyone. We just have to get the dials right. The resolution focuses on determining the right path to include neighborhood residential in that recalibration.”
City Councilmember Dionne Foster has introduced a bill that will give developers a break on mandatory housing affordability fees for two years, with the goal of spurring projects forward at a time when housing development is stalled.
Under the deal, which is similar to one that fell apart earlier this year, developers who already have projects in the city’s development pipeline will get an 80 percent break on MHA fees for the next two years, a reduction that could get some of the 30 or so projects that are currently stalled moving forward. Developers of these projects would have two years to get to the foundation inspection stage, a requirement designed to make sure they actually build the projects quickly.
In a concession to affordable advocates who argued that the MHA “holiday” would inappropriately reduce funding for affordable housing, the legislation exempts non-vested projcets in the Central District, the ChinatownInternational District, and much of Southeast Seattle from the proposal, ensuring that no developer can propose a new project in those areas while the lower fees are in place. Two of the 30 stalled projects are in this area, but both are on vacant land.
The legislation would also allow developers to propose new, or non-vested, projects—in addition to projects that are currently proposed but not moving forward—in 2027 only if they meet two conditions: At least 25 percent of their new units must be two bedrooms or larger, and their project has to reach the foundation inspection stage within three years after they get their building permits. Those projects will get a 60 percent cut to MHA fees, except for “legacy homeowners, who would get an 80 percent reduction as in MHA fees to develop on their own property.
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“This feels really important because we have a lot of projects that are stalled and permits that are trending down, and this is an opportunity to take action,” Foster said. “I’m really excited about two-bedroom requirement. … I think that’s an example of something that helps address a gap in the market, knowing that we definitely need more family-size units to meet the needs of Seattle renters and Seattle families, and I hope that will have an impact.
Mayor Katie Wilson’s office was not involved in the deal, and in fact had been working on a parallel track, headed up by Councilmember Eddie Lin. When an earlier effort to reach a similar agreement fell apart after affordable housing developers withdrew their support, Wilson announced she would convene a task force of stakeholders including advocates, labor, and market-rate and nonprofit to broker an MHA compromise, among other policies to spur new affordable housing construction.
Developers, who have been seeking a temporary break from the fees, for months, have argued that Wilson’s drawn-out timeline would have effectively killed the projects that are currently in the pipeline.
MHA fees, which fund affordable housing, have been on the decline as development has slowed, dropping from $74 million in 2021 to $47 million last year. (Editor’s note: An earlier version of this story erroneously said MHA brought in $22 million last year; we regret the error.)
Foster said the work Wilson’s office did on their parallel MHA strategy was “critical. … I see this proposal as taking on a time-sensitive. immediate, short-term approach and I think there’s lots of additional changes that we need to make to support housing and affordable housing production. There’s certainly no shortage of issues for us to all work on, so I think the mayor’s task force will be a really important part of that.
In a statement to PubliCola, Wilson said her task force will “work on multiple fronts to accelerate the production of housing and prevent displacement, including short and long-term updates to MHA. I respect Councilmember Foster’s decision to move forward now with a proposal for a temporary MHA holiday, similar to the one we were developing together this spring. While the Council deliberates, my focus is on the work of the Housing Production Task Force and lining up our next set of key actions and policies.”
Foster’s proposal also includes a resolution that says the council “intends to consider and act on legislation” that would apply MHA requirements to neighborhood residential areas—former single-family zones, where small apartment buildings are now allowed. Currently, these areas are exempt from MHA. Foster says her proposal is different than former councilmember Cathy Moore’s plan to impose existing MHA requirements on all neighborhood residential areas because it is less prescriptive; the resolution includes a number of possible carveouts, for example, it says the council may consider charging lower fees for denser development.
MHA, which went into effect citywide in 2019, allowed developers to build slightly taller buildings in exchange for variable affordabl-housing fees. The program, part of the Housing and Livability Agenda adopted during the Ed Murray administration, is based on the premise that new market-rate apartments can cause displacement of existing residents, so developers should have to pay for new affordable housing to offset their impact. The fees are higher in areas the city determined have less access to opportunity and higher displacement risk, making it more expensive to build new housing in, say, the Central District than Laurelhurst.
I will be out of town until next Thursday, so look for my stories on the mayor’s gun violence reduction strategy, Dan Strauss’ proposal to ban unregistered RVs from Seattle, and the mayor’s budget announcement after I get back on Thursday, September 24. Plus a couple more posts between now and then.
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