By Erica C. Barnett

City Council budget chair Teresa Mosqueda said yesterday that she would propose using JumpStart payroll tax revenues to supplement the city’s general-fund budget for the fourth and fifth years in a row, after the City Budget Office released new projections of a growing budget shortfall through the next five years. Between 2023 and 2026, the city now projects an average budget gap—the difference between revenues coming in and expenditures going out—of $142 million, on average, including a $141 million budget gap next year.

JumpStart—a payroll tax paid by the city’s largest employers on the salaries of their highest-paid workers—has consistently produced more revenue than originally anticipated. Since it went into effect in 2021, the tax has paid for COVID relief, housing, small business support, and to top off the general fund. Mosqueda’s proposal, which hasn’t been formally drafted, would use JumpStart revenues in excess of the city’s original 2020 projections to backfill the general fund in 2023 and 2024; currently, the city projects those excess revenues at $71 million and $84 million, respectively.

“The broad coalition that proposed JumpStart always intended to avoid austerity, and we can do both the spend plan as codified in 2020 and potentially find some short-term solutions for addressing the shortfall,” Mosqueda told PubliCola on Wednesday. In the meantime, she said, Mayor Bruce Harrell’s office is convening a new progressive revenue task force to consider other locahoul revenue sources. The original progressive revenue task force, which recommended a payroll tax in 2018, also said the city should consider a local estate tax, a tax on excess compensation, and a tax on real-estate speculation, among other options.

“This is just a 2023-2024 option,” Mosqueda said. “This is not a stopgap measure; this is a temporary use because that additional source of progressive revenue has not been passed and we need to prevent austerity while maintaining the city’s commitment to the JumpStart spending plan.”

In addition to new revenues, the city could be looking at cuts to departments, including the elimination of some positions that have been vacant but funded in the budget for long periods. Advocates for reducing the Seattle Police Department’s budget aren’t likely to see much trimming in that area, though; the last time a council member (then-council president Lorena González) proposed reducing SPD’s budget by eliminating unfillable positions, the council voted it down.

At the same time, the King County Regional Homelessness Authority, which is primarily funded by the city, sent a budget proposal to the city and county earlier this year requesting $90 million for new programs, on top of the $119 million that it currently receives from the city and county. If the city funded this extra spending proportionally to its current contribution ($70 million in 2022), that would amount to an additional $60 million in city spending.

Harrell has expressed frustration publicly about the KCRHA’s budget, and has reportedly wondered aloud privately what the agency is doing with its money. Efforts to stand up a program to “navigate” people off the streets of downtown Seattle by placing them in shelters or housing, launched with a one-time infusion of private money earlier this year, are going slowly, with one of the program’s high-profile leaders leaving the agency after just three months in June. In February, KCRHA director Marc Dones said one of the goals of the initiative was to reduce the number of people living unsheltered downtown to around 30, or “functional zero,” in as little as 12 months.

When PublICola asked Harrell about KCRHA’s big budget ask back in June, he said the agency seemed to “approach the budgeting process as, ‘in a perfect world, this is what [we] could do.’… But at some point, I need you to do the hard work, which is tell us exactly what you need. This is not a negotiate, ‘you go high, I go low,’ process.”

Harrell will send his proposed budget to the council on September 24.