Category: Taxes

Seattle Shuffles Scooter Share Deck, Library Invests in Social Services, Campaign Forms to Fight Potential Cannabis Tax

1. Bird, a scooter provider that’s already ubiquitous in cities across the country, will soon enter the Seattle market, while Spin and the venture-backed sit-down scooter company Wheels will no longer be seen on Seattle streets. In addition to Bird, Link and Lime will continue as scooter providers in Seattle.

The Seattle Department of Transportation announced the scooter shuffle on its website last week, just weeks after publishing the results of a controversial, nonscientific survey concluding that more scooter riders are injured while riding than previously reported.

The city will also permanently permit a new bikesharing company, Veo, whose low-slung bikes have vestigial pedals but function more like a sit-down scooter, with a throttle that allows riders to propel them while using the pedals as footrests.

Seattle’s relationship with scooters (and bikesharing) has long been ambivalent. In 2020, two and a half years after banning scooters entirely, the city took a baby step forward by issuing permits to three companies for 500 scooters each. Since then, the city has expanded its scooter permits to allow each of three providers to put 2,000 scooters on the streets; Lime, which provides both e-assist bikes and scooters, has a fourth permit for a total of 2,000 bikes and scooters.

According to SDOT’s scoring matrix, Spin narrowly lost out to Bird, Link, and Lime after scoring slightly lower on two measures: Parking (which includes policies the company implemented to make sure people parked correctly and how it responded to improperly parked scooters) and “operations and equity,” which included a number of factors such as how the company responds to complaints and its efforts to place scooters in “equity areas” outside the center city, including southeast and far north Seattle.

According to the city’s scooter data dashboard, Wheels scored particularly poorly compared to other companies, including Spin, at providing equitable access to its scooters.

Veo, which operates like a scooter but is classified as a bicycle, poses what SDOT spokesman Ethan Bergerson calls “interesting questions” for the city. Unlike traditional scooters, Veo devices are legal on sidewalks; because they aren’t classified as scooters, they also occupy one of just three potential bikeshare permits, which could limit the number of shared e-bikes allowed on city streets in the future, if other companies decide they want to enter the Seattle market.

“The bike/scooter share landscape is very dynamic and has shifted considerably since the bike share program began in 2017,” Bergerson said, and now includes “more companies offering devices which combine some of the features of bikes and some of the features of scooters. … If this market trend continues, it may make sense to consider how to adjust our permits to reflect the changing technology and industry trends.”

2. The Seattle Public Library is ending its contract with the Downtown Emergency Service Center, which for more than five years has provided a part-time “community resource specialist” to connect patrons to food, social services, and shelter, and hiring its own social service specialists.

The new hires include an assistant managing librarian at the downtown branch to oversee the work; a new social services librarian who will “work with information staff to maintain current information and contacts, coordinate the Bus Ticket program, and act as a link between our regular information services and our Community Resource Specialists,” according to library spokeswoman Elisa Murray; and two new in-house community resource specialists, including one who will focus on outreach to youth and young people.

“While this new model doesn’t necessarily provide patrons more time with on-site staff, we do think we can maintain more partnerships with this model, which we hope will lead to increased opportunities for patrons to access the supportive services they need,” Murray said.

For years, libraries (including Seattle’s) have debated whether, and to what extent, library staffers should be responsible for connecting patrons not just to library materials, but to social services and resources outside the library’s direct control. By hiring staff to oversee some of this work, SPL is making a more direct investment in the the theory that libraries can and should do both.

3. A new independent expenditure group representing marijuana retailers, called People for Legal Cannabis, just filed with the Seattle Ethics and Elections Commission, reporting $16,000 in debt to the polling firm EMC Research. The group’s intent: To fight off potential legislation, first reported by David Hyde at KUOW, that would impose an additional sales tax on weed sales in Seattle. If the legislation, currently being floated by the United Food and Commercial Workers Local 3000, passes, the group could propose a referendum to overturn the law.

According to a presentation first posted on KUOW, which PubliCola obtained independently, the UFCW’s still-nascent proposal would impose a “cannabis equity tax” of 25 cents a gram on flower; $2.00 per half-gram of high-potency concentrates; and a penny per milligram of THC in everything else. The money would fund a paid “cannabis equity commission”; “workforce training” for cannabis workers; and a “cannabis equity fund” that would “prioritize the needs of those most impacted by the War on Drugs,” which locked up millions of Black and brown Americans for possessing and consuming weed. Continue reading “Seattle Shuffles Scooter Share Deck, Library Invests in Social Services, Campaign Forms to Fight Potential Cannabis Tax”

Hiring Bonuses Don’t “Compensate” for Other Issues Impacting City Worker Retention; Bright Economic Forecast Won’t Zero Out Budget Gap

1. During a briefing at the city council’s public safety committee about the city’s struggle to retain qualified staff in every department, City Councilmember Sara Nelson suggested there is no need to “study the benefit of [hiring] incentives” for police, “because it’s been shown to work in other cities—pretty much most if not all cities in our region.” With public safety “such a crucial issue right now,” Nelson continued, “this is something that doesn’t need a lot more study.”

Nelson, whose legislation to fund hiring bonuses will come before the same committee later this month, was responding to a presentation by the city’s Human Resources Department about a survey that concluded the biggest barrier to retention for most city staffers is the city’s 32-year-old job classification system, which creates artificial barriers to advancement for many city workers. 

Her comments elicited immediate pushback from other council members, including committee chair Lisa Herbold, who pointed out that recent short-lived hiring bonuses did not lead to more applicants for police jobs, although they did get people to apply for jobs at the city’s new 911 call center. (After the city offered hiring bonuses for new SPD recruits in 2019, slightly fewer than one in five applicants said the hiring bonus was one factor in their decision to apply). Councilmember Andrew Lewis asked, semi-rhetorically, whether there was any city in the country that wasn’t currently struggling to retain officers right now. And Councilmember Teresa Mosqueda went further, apologizing to SDHR’s Keith Gulley “on behalf of the council” because “the work that you’ve done was impugned” by Nelson.

So, about that work: SDHR’s analysis found that, in general, hiring incentives serve as “a one-time quick fix that may not compensate for uncompetitive wages, difficult or unsupported work conditions, lack of opportunity to develop career relevance, experience and skills, and limited promotion opportunities” at the city, Gulley said. Additionally, signing bonuses for new hires can hurt the morale of existing employees who “feel undervalued and underappreciated” because they’re doing the same work with no extra reward.”

The hardest jobs to fill, according to the department’s survey, include carpenters, plumbers, and truck drivers as well as IT programmers, senior civil engineers, and public safety auditors. 

The shortcomings of the city’s job classification system are especially troubling for mid-career employees, who frequently get stuck in mid-level positions because they lack a requirement, such as a graduate degree or specific college credits, to move up the ranks. Gulley gave the example of an accountant who had been at the city for more than 15 years but got stuck on the ladder because she hadn’t taken 24 hours of required coursework back in college. “That’s where the majority of our employees who have worked for the city for years get stuck,” Gulley said.

Of three possible scenarios, the city is using “baseline” assumptions in its forecast.

2. An economic forecast released by the city’s Economic and Revenue Council last week predicts the city will take in about $90 million more in taxes and fees this year than a similar forecast predicted six months ago, thanks to higher-than-expected revenues from sales taxes, the JumpStart payroll tax, and the tax on real estate sales.

In all, the city expects to collect about $711 million in general-fund revenues, which fund the city’s annual budget, in 2022—a 5.6 percent increase over 2021. The forecast also predicts the city will take in about $447 million in other taxes and fees that can only be spent on specific purposes, including taxes on real estate sales, which fund capital projects. Next year, the city predicts that revenues will continue to grow, but at a slightly slower rate.

In a press briefing last week, ERC director Ben Noble cautioned that the actual value of city tax dollars—the bang the city can get for its buck—will be reduced this year because of high inflation. And he noted that job growth has been distributed unequally: While tech and other white-collar jobs have more than bounced back, hiring in hotels and the hospitality industry, as well as manufacturing, is still far below pre-pandemic levels. Continue reading “Hiring Bonuses Don’t “Compensate” for Other Issues Impacting City Worker Retention; Bright Economic Forecast Won’t Zero Out Budget Gap”

Olympia Wrapup: Democratic Majority Falls Short on Core Democratic Agenda

Despite Democratic control in both houses, Washington state’s tax code remains deeply inequitable.

By Leo Brine

Last Thursday marked the end of the 2022 legislative session. Lawmakers only had 60 days to pass legislation, write and pass two supplemental budgets, and pass a transportation spending package. At the outset of the session, Democrats, who have a 57-seat majority in the house and a 29-seat majority in the senate, said they wanted to pass bills to help with housing affordability, homelessness, environmental sustainability, and the economy.

When it comes to housing, Rep. Nicole Macri (D-43, Seattle) told PubliCola, “it was not a great year in terms of policy.” Macri pointed out that Democrats killed Rep. Jessica Bateman’s (D-22, Olympia) bill to allow denser housing statewide (HB 1782) and Rep. Sharon Shewmake’s (D-42, Bellingham) accessory dwelling unit (ADU) bill (HB 1660), both of which could have helped the state increase its housing stock. Bateman’s bill would have required all Washington cities to include denser housing options, like fourplexes and courtyard apartments, in neighborhoods zoned for single-family housing, while Shewmake’s would have permitted mother-in-law apartments and backyard cottages in all types of residential neighborhoods.

When it comes to housing, Rep. Nicole Macri (D-43, Seattle) said “it was not a great year in terms of policy.”

The legislature also killed Rep. Strom Peterson’s (D-21, Lynnwood) tenant protections bill (HB 1904), failing to vote on it by the first legislative deadline.  Michele Thomas from the Washington Low Income Housing Alliance said it was “one of the biggest losses of the session,” adding, “Democrats in the House shouldn’t have been afraid to vote on that bill.” The bill would have required landlords to give tenants six months’ notice before increasing rent; capped fees for late rent payments at $75; and provided tenants who could not afford a rent increase assistance moving somewhere they could afford. Thomas said the bill was tame and didn’t propose any kind of rent control, typically a third rail for legislators.

Democrats did manage to pass some homelessness bills that will provide temporary help to people living on the streets. The house and senate passed Rep. Frank Chopp’s (D-43, Seattle) bill that attempts to connect people under the state’s Apple Health (Medicaid) program with permanent supportive housing (HB 1866). Although the bill initially passed without funding, Democrats secured $60 million for the program in the capital budget. Macri saw the provision as a necessary upgrade. “Being on the budget team, I tried to focus on making sure we had strong investments because we didn’t have the strong policy I wanted to see pass,” she said.

To respond to the ongoing climate crisis, which is only getting worse, Democrats used their transportation package to try and reduce the state’s overall emissions by investing in electrified ferries, expanded transit services and better bike and pedestrian infrastructure.

Climate Solutions Washington Director Kelly Hall said she was pleased with the investments Democrats made with the transportation package and hopes they will allocate more of the funding from the transportation package toward electrifying heavy-duty machinery, like long-haul trucks and construction vehicles, between now and the 2023 legislative session.

While Hall supports the transportation package, she said the legislature failed to pass bills that would reduce emissions from the state’s gas-heated buildings and from other common polluters people don’t often think of. Hall pointed out Rep. Macri’s bill (HB 1918) would have exempted the purchase of energy efficient lawn equipment from the state’s sales tax and encouraged more people to ditch their gas-powered leaf blowers and lawnmowers for zero-emission models. Gas-powered lawn tools “emit a lot of toxic air pollution right in our communities,” Hall said. Continue reading “Olympia Wrapup: Democratic Majority Falls Short on Core Democratic Agenda”

Capital Gains Ruling Threatens Legislative Victory for Progressives

A Douglas County Judge ruled on Tuesday that the statewide capital gains tax, which progressive legislators passed last year, is unconstitutional. The ruling concerned two lawsuits that were consolidated into one—one by the conservative Freedom Foundation, the other by Republican former state attorney general Rob McKenna.

The decision marks a win for Washington’s ultra-wealthy, like Steve Gordon of Gordon Trucking and hedge fund manager Brian Heywood, who each contributed $20,000 to an initiative campaign to repeal the tax; former Starbucks CEO Howard Beher, contributed $5,000. Unsurprisingly, the Attorney General Bob Ferguson, a Democrat, said he would appeal the decision to the state Supreme Court.

Douglas County Superior Court Judge Brian Huber wrote in his ruling that the 7 percent tax on the sale of intangible financial assets, such as stocks and bonds, violates Washington’s constitution’s “uniformity clause” because it imposes “zero tax on capital gains below that $250,000 threshold.” The uniformity clause prohibits the state from taxing different property at different rates.

Democrats have argued that the tax is constitutional because it doesn’t assess property, but rather, the sale of property, making it an excise tax, not an income tax. Huber rejected that argument, saying the plaintiffs “properly characterized [the capital gains tax] as an income tax” in their lawsuit. And since Washington considers income to be a form of property, any income tax would need to meet the state constitution’s uniformity clause.

Washington is one of the few state’s in the country without an income tax. The state instead relies heavily on business and sales taxes to generate revenue. Democratic lawmakers have frequently criticized this model as regressive, because it means that people who earn less pay a larger percentage of their income in taxes than wealthy people pay. Democrats saw the capital gains tax as a way to reverse this regressive .

Following the judge’s decision, State Attorney General Bob Ferguson said  if the tax were ultimately struck down, the state could lose hundreds of millions in funding for childcare programs, early learning, and school construction projects. “Consequently, we will continue defending this law enacted by the peoples’ representatives in the legislature. All the parties recognize this case will ultimately be decided by the State Supreme Court. We respectfully disagree with this ruling, and we will appeal.”

—Leo Brine

Amid Court Battle Over Capital Gains Tax, House Finance Chair Previews Future Reforms

State Rep. Noel Frame (D-36)
State Rep. Noel Frame (D-36)

By Clara Coyote

Following up on last year’s capital gains tax—a major legislative win for progressives during the 2021 session that puts a 7 percent tax on profits greater than $250,000 from the sales of assets, such as stocks and bonds—state Rep. Noel Frame (D-36) has her eye on comprehensive structural change for Washington’s upside-down tax code. The poorest fifth of Washington state residents pay, on average, 16.8 percent of their incomes in state and local taxes while the richest 1 percent of Washingtonians pay an average of just 2.4 percent.

A key piece of that larger agenda for Frame, the House finance chair, is a wealth tax; she introduced a version last year,  HB 1406, which the state department of revenue estimated would bring in $2.5 billion a year. Frame passed the bill out of her Finance Committee last year before it stalled in House Appropriations. Frame said she sees the senate version, SB 5426, as this year’s vehicle, and hopes the Senate Ways and Means Committee will hold a hearing on the legislation. 

Additionally, Rep. Frame said there will be smaller but meaningful bills during this year’s short (60-day) legislative session to clarify the implementation of existing legislation—for example, refining the 2023 rollout of the Working Families Tax Credit, a program Democrats passed last year, that will provide payments ranging from $300 to $1,200 to low-to-moderate-income people. Frame’s committee may also consider progressive modifications to the existing estate tax, by lowering taxes on small and medium estates while increasing taxes on the largest. This is work that first began with HB 1465, introduced (but not passed) last year.

Frame said that larger, systemic reform is emerge from the work of the multi-year bipartisan Tax Structure Work Group, which Frame chairs. Frame told PubliCola that she hopes to see bills as soon as 2023 refining an anti-displacement property tax exemption proposal meant to protect housing for mid-to-low income Washingtonians. In its final draft, Frame said, the legislation will incorporate feedback from town hall meetings where participants said renters as well as homeowners should benefit from the exemption. Frame said the work group will also figure out the details of her proposed wealth tax. 

Frame believes small businesses also need help. “We have the business and occupation (B&O) tax passed in the 1930s as a temporary measure that never went away,” Frame said. The B&O tax applies to all revenues a business takes in, regardless of whether a business turns a profit. “This disproportionately harms small businesses,” Frame said. “A central goal of the working group is finding a better alternative.”

Frame said she’s well aware that the progressive capital gains tax is already facing a court challenge but said she’s undeterred about moving forward with additional reforms that could draw more lawsuits. “Just because the rich and the powerful will threaten us every single time with a lawsuit doesn’t mean we shouldn’t ask them to pay their fair share,” she said. 

Durkan Budget Would Gut JumpStart Spending Plan, Increase Funding for Encampment Response

By Erica C. Barnett

Mayor Jenny Durkan released the final budget of her term yesterday, outlining the proposal at a very high level in a six-minute speech from North Seattle College. In the coming weeks, the proposal will be debated, analyzed, and rewritten by the Seattle City Council (the addition of 35 net new police officers is an obvious target for their red pens), and PubliCola will be covering every aspect of those upcoming discussions. For now, though, here are a few initial notes on the plan, which reflects better-than-expected revenues and incorporates a lot of ongoing federal funding for COVID relief.

• The budget proposes taking $148 million from the city’s payroll tax fund, a repository for revenues from the JumpStart payroll tax, and moving it into the general fund to pay for Durkan’s other priorities. Legislation the mayor will transmit to the council would also empower future mayors to use JumpStart revenues for virtually any purpose, including the “[m]aintenance of existing essential City services.” The mayor’s proposal would remove language from existing law stipulating that the tax can’t be used to “supplant existing funding from any City fund or revenue source.”

The council adopted the payroll tax specifically to fund programs addressing housing, homelessness, and equity, and created a separate fund for JumpStart revenues with the intention that they couldn’t be used for other purposes—which is precisely what Durkan is proposing to do.

“The proposed changes are necessary in order to reconcile the priorities identified in [the JumpStart bill] with Council actions in support of other critical funding needs, including homelessness, community safety, BIPOC investments, domestic violence prevention and victim services, appropriate compensation for City employees, and the ongoing shortfall in some City revenues,” the mayor’s budget proposal says.

The city estimates that JumpStart will bring in about $235 million next year, so Durkan’s plan would use up the majority of JumpStart funding for non-JumpStart purposes.

Durkan attempted to reallocate JumpStart revenues last year as well.

A summary of the bill by the City Budget Office notes that Durkan didn’t sign the JumpStart bill, “expressing many of the same concerns about earmarking certain revenue streams at a time when the City was making significant investments using one-time funding received from the federal government as a response to the COVID-19 public health emergency.” She also vetoed legislation last year that used JumpStart revenues to fund COVID relief, a veto the council narrowly overturned.

The city estimates that JumpStart will bring in about $235 million next year, so Durkan’s plan would use up the majority of JumpStart funding for non-JumpStart purposes. The budget would use one-time federal emergency dollars to backfill the gap in the JumpStart fund, but because those funds only last one year, the budget creates a future funding cliff for the next mayor and council. If the council adopts this plan, it will have to either cut the programs Durkan funded using a tax meant for other purposes, or continue to dip into JumpStart revenues while cutting back on programs funded this year with one-time funds. It seems unlikely that the council will allow this part of the budget proposal to stand as is.

This is hardly the first time Durkan has proposed dipping into funds earmarked by legislation for a specific purpose in order to fund her own unrelated priorities. In 2018, she started using funds from the sweetened beverage tax—a tax that was supposed to fund healthy food programs in areas most impacted by the tax—to pay for programs that had historically been funded through the city’s general fund, creating “extra” money for her office to allocate elsewhere.

Mayoral spokeswoman Kamaria Hightower said the higher-than-expected contribution to the regional homelessness authority “represents increased spending on homelessness projected 2022. The [agreement] was written in 2019 and did not contemplate the pandemic or the massive infusion of funds to help our most vulnerable neighbors stay safe.”

When the council attempted to reverse this sleight-of-hand and use the tax revenues for their designated purpose, Durkan accused them of “cutting” programs that she was using the tax to fund, setting off a nasty battle that resulted in the council creating a designated fund for soda tax revenues—much like the designated JumpStart fund.

• Durkan wants to add another 35 (net) new police officers to the force—a fairly modest goal, but one directly in conflict with many council members’ stated commitment to reduce the size of the police department and invest the savings into community-based public safety alternatives. Last year, Durkan vetoed the entire city budget because the council amended it to reduce the size of the police force, a veto the council subsequently overturned.

Although the budget proposal includes funding for new and continued alternatives to policing and police response, such as Health One and Triage One, and funding for the Regional Peacekeepers Collective, a gun-violence prevention program, it also commits to “restoring SPD staffing to previous levels” by hiring new officers. To that end, Durkan’s budget also includes $1.1 million to pay for hiring incentives for new recruits and officers who make lateral transfers from other departments.

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The city council just rejected a series of proposals from Councilmember Alex Pedersen that would have set aside as much as $3 million to retain existing officers and recruit new ones to the department.

• The budget proposes sending more money than the city originally agreed to provide—$104.2 million, compared to $75 million the city agreed to provide in the interlocal agreement adopted in 2019—to the King County Regional Homelessness Authority, which is supposed to take over (almost) all the homelessness programs previously managed by the city at the end of this year. The homelessness authority is funded by the city and King County; suburban cities, which hold three seats on the authority’s governing board, don’t contribute financially to the authority.

Mayoral spokeswoman Kamaria Hightower said the higher-than-expected contribution “represents increased spending on homelessness projected 2022. The [agreement] was written in 2019 and did not contemplate the pandemic or the massive infusion of funds to help our most vulnerable neighbors stay safe.”

The new funds include $2.4 million in state and local funds for “tiny home villages,” coincidentally the same amount of state and local dollars the council has been trying to get the mayor to release to pay for three new tiny house villages this year. The mayor’s proposed $2.4 million would pay for ongoing “operations, maintenance, and services s for three tiny home villages (estimated 120 units) or other noncongregate emergency shelter or temporary housing options,” leaving open the possibility that the regional authority might fund a different shelter option.

However, because the money is supposed to “operationalize” funding in the state capital budget that was explicitly for “tiny homes,” it’s likely that advocates for tiny house villages would object strongly to using the money for some other kind of shelter. Authority CEO Marc Dones has expressed skepticism about tiny houses as a form of temporary shelter, noting that people tend to stay in villages far longer than the city’s own goals for the program.

There’s also funding in the proposal for a new men’s shelter run by Africatown at a former nursing home in the Central District; ongoing support for the Salvation Army’s mass shelter in SoDo; and about $190 million for new housing, paid for through the voter-adopted housing levy, federal dollars, and other funding sources.

Durkan’s proposed budget increases funding for Parks’ encampment work by almost a million dollars, adding 6.5 full-time equivalent employees to respond to “the increased demand on [Seattle Parks and Recreation] to address impacts of unmanaged encampments, such as litter removal, storage of personal belongings, and data collection & reporting in compliance with Multi-Department Rules (MDAR).”

The budget also proposes $6 million for services to help people who receive federal emergency housing vouchers maintain their housing when the vouchers run out. Some of this money, according to the budget summary, could come from rapid rehousing funds. As we’ve reported, the city’s plan to move people quickly from two shelter-based hotels into apartments using rapid rehousing subsidies has failed to place many people in housing, largely because the people moving into the hotels tend to be poor candidates for rapid rehousing programs, which generally require tenants to pay full market rent within a few months to a year.

• Although Durkan’s budget plan relinquishes control of most homelessness work, it still assumes that the city, not the regional authority, will maintain its role removing encampments and, to some extent, doing outreach to unsheltered people, although the form that role will take is unclear. Budget director Ben Noble told PubliCola yesterday that although “the shelter contracts and related pieces are all going to the regional authority… the feeling was that folks who are on the street and not in a sanctioned encampment but living outside are sill the primary responsibility of the city.” Continue reading “Durkan Budget Would Gut JumpStart Spending Plan, Increase Funding for Encampment Response”

Is It Time for Free Transit?

Image of Metro’s Route 99, a free waterfront bus that ran until 2018, by Atomic Taco

By Katie Wilson

Last week, PubliCola reported a “surprising consensus” among Seattle mayoral candidates on the subject of free public transit. Jessyn Farrell, Lorena González and Andrew Grant Houston have all displayed enthusiasm for pursuing this vision, while Colleen Echohawk and Bruce Harrell have expressed more cautious interest.

During the COVID-19 pandemic, when local transit agencies stopped charging fare and implemented back-door boarding, transit riders who kept on riding got a taste of what a fare-free system might be like. No more fumbling for change, no tapping a card, just hop on the bus or the train. But even before the pandemic, free transit was having a moment.

On January 1, 2020, Intercity Transit, which serves Olympia and the rest of Thurston County, went fare-free. In the first month, ridership jumped up 20 percent. Bobby Karleton, a community organizer and daily bus rider in Olympia, noticed the change: “More people of color, elderly and disabled people and families with small children appear to be using the system,” he said. “For IT’s most impoverished riders—many who are homeless—free service means saving $1.25 every bus ride. That may not sound much, but it adds up.”

But even before the pandemic, free transit was having a moment.

Olympia wasn’t alone. In December 2019, Kansas City, Missouri became the first major U.S. city to dispense with fares. A few months earlier, Lawrence, Massachusetts began a two-year pilot. It was starting to look like a trend, but it wasn’t entirely new—in fact, the Pacific Northwest has long been something of a quiet national leader on free transit. A number of smaller cities and rural areas in Washington, Oregon and Idaho have operated fare-free systems for decades. Visiting Whidbey Island? Put away that wallet. Traveling around Mason County? Welcome aboard.

For Seattle, a city accustomed to being on the leading edge of progressive policy, this is all a little embarrassing. How could we let other parts of our own state—including some that vote Republican!—get so far out ahead? Why are many of us still paying $2.75 to stand, crammed in like sardines, on buses crawling down car-choked streets? Why do we submit to the indignity of fare inspections, with steep fines that punish poverty and disproportionately harm Black riders? In a global climate crisis, why are we still erecting barriers to choosing sustainable transportation? In short, when is fare-free transit coming to Seattle and King County?

Sadly, it’s not quite that simple — but it’s not an impossible dream, either. Let’s take a look.

The transit agencies that have recently hopped on the fare-free bandwagon all have one thing in common: They’re smaller systems, and their revenue from fares is small both absolutely and as a portion of their total budget. Kansas City had to scrape together a modest $9 million per year. In the case of Intercity Transit, fares covered less than 2 percent of operating costs, and the agency was facing an expensive upgrade to the ORCA card system. For some rural systems the calculus is even more extreme: The ancillary costs of collecting fares exceed the fare revenue itself. In both cities, fare-free just makes sense.

The notion that fare-free transit somehow pencils out without a massive infusion of new tax revenue is a pipe dream.

By contrast, in a large, dense urban system like ours, fares bring in real money. Pre-pandemic, farebox revenue covered about a quarter of the operating costs for King County Metro’s bus system. Metro’s annual haul from fares was somewhere in the neighborhood of $175 million. Sound Transit, which operates Link light rail, regional Express buses and the Sounder line, brought in another $100 million. While it’s true that collecting and enforcing fares also costs money—a 2018 audit found that Metro spent $1.7 million per year on fare enforcement, for example—the amounts simply aren’t comparable. The notion that fare-free transit somehow pencils out without a massive infusion of new tax revenue is a pipe dream.

That’s not the only challenge for fare-free transit. While it’s undeniable that the cost of fares is a hardship for many and a disincentive for many more, the bigger problem for most people—including those with low incomes—is the service itself. Public transit doesn’t come frequently enough or get people where they need to go fast enough. Buses and trains are overcrowded and don’t run at all times of the day and night. So even if the transit agencies found a quarter billion dollars on the doorstep every year, eliminating fares might not be the highest and best use of those funds—especially since people would respond to this change by riding still more, further increasing the demand for service.

Recognizing these realities, over the past decade community organizers, advocates and transit riders have taken a needs-based approach to fare-free transit. Through pressure and work with elected officials and agency staff, they’ve won and expanded a suite of reduced- or no-cost transit programs serving specific populations: the Human Services Ticket program, ORCA LIFT reduced fare program, Seattle Youth ORCA program, and, as of last fall, a no-cost annual transit pass program for people below 80 percent of the federal poverty level. I have been involved in all these efforts through my work with the Transit Riders Union. Continue reading “Is It Time for Free Transit?”

Many Top Mayoral Candidates Support Free Transit. Here’s What Corporations Would Save.

Image by Atomic Taco, via Creative Commons

As the leading mayoral candidates establish (and sometimes alter) their positions on major campaign questions, including homelessness, growth, and transportation, a surprising consensus has emerged around an issue that wasn’t even on the table four years ago: Free public transit.

The city has slowly expanded programs subsidizing transit passes for students and low-income residents, providing free or reduced-cost passes to thousands of riders. But elected officials, as well as the leaders of Sound Transit and King County Metro, have balked at making transit free for everyone, arguing that free transit would punch a huge hole in their agencies’ budgets. About a quarter of both agencies’ budgets come from revenue collected at the farebox.

Current city council president Lorena González and former council member Bruce Harrell both said they support free fares, at least in concept, although González has been more enthusiastic in her support. At a forum sponsored by the MASS Coalition last month, González said she “would be committed to making sure that we initiate every effort we can to accomplish the goal of free public transit,” looking to US cities and cities in Europe that have made transit free, such as Talinn, Estonia, as examples.

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Jessyn Farrell, a former state legislator who directed the Transportation Choices Coalition, was more effusive, saying at the same forum that she “absolutely and with a great amount of enthusiasm” supported eliminating transit fares. “Free transit is a core component to getting us to net zero [carbon emissions],” she said. “And it is a core component to racial equity in our system and access and decriminalizing the use of our transit system.”

People who pay full price for public transit would benefit from fare-free transit, obviously. So would large and small businesses, which provide a substantial chunk of transit agencies’ revenue through free or subsidized transit passes for employees, including highly compensated tech workers who could easily afford to pay full fare. This raises potential equity questions, because free transit would shift the cost burden for these workers’ free transit from corporations like Amazon and Microsoft onto taxpayers. Continue reading “Many Top Mayoral Candidates Support Free Transit. Here’s What Corporations Would Save.”

State Goes on Offensive to Save Capital Gains Tax, Police Oversight Group Considers Candidate Forum, and Compassion Seattle Plays Victim

1. Washington State Attorney General Bob Ferguson filed a motion Tuesday seeking to have a Douglas County judge throw out two lawsuits against the capital gains tax. Ferguson argues in his motion that the plaintiffs filed the suits for political reasons and don’t have grounds to sue because they don’t know yet if they’d be subject to the tax.

The capital gains tax bill (SB 5096) imposes a 7 percent tax on profits of $250,000 or more from the sale of intangible financial assets, such as stocks and bonds. The bill would go into effect in 2022, but the state would not collect taxes until January 2023. Roughly 7,000 Washington taxpayers would be subject to the tax, which would generate $415 million for the state in its first year.

Three days after the legislature passed the bill, the Freedom Foundation, a conservative think tank, challenged the law in court. Less than a month later, former attorney general Rob McKenna, along with the Washington Farm Bureau, filed a second lawsuit against the bill. Both suits were filed in conservative Douglas County.

The lawsuits say taxing capital gains is unconstitutional because capital gains are property, and all property must be taxed at a uniform rate in Washington because of a 1933 state Supreme Court decision.

However, Democrats have argued that the capital gains tax is an excise (sales) tax, not a property tax, because it is triggered by the sale of financial assets.

Ferguson argued that the plaintiffs have asked the court to settle a political dispute, rather than a legal one, noting that they “are suffering no legal harm from the tax they challenge and ask this Court to issue a purely advisory political opinion.” He also argued that the lawsuits are preemptive and speculative, since the plaintiffs don’t know whether they’ll even have to pay the tax when it goes into effect in 2023.

The state Supreme Court is also hearing arguments for a lawsuit against the state’s 2019 bank business and occupation tax (HB 2167), which was also filed by McKenna. Washington State Solicitor General Noah Purcell argued at the court on May 25 that state law prohibits lawsuits against taxes until they have gone into effect. If the court sides with Purcell, the lawsuits against the capital gains tax might have to wait until state residents actually pay the tax, which wouldn’t be until 2023 at the earliest.

State Sen. Jamie Pedersen (D-43, Seattle) said that if the court dismisses the lawsuits, it will only delay the inevitable: having the state Supreme Court reviewing the law. Democrats want the court to review the tax because they believe the court would overturn the previous ruling declaring income a form of property, which would blow the doors open for an income tax.

The next hearing for the cases is set for July 13 at 10am, with Douglas County Superior Court Judge Brian Huber presiding.

2. The future of the Seattle Police Department is front-and-center in the upcoming elections, but some members of Seattle’s Community Police Commission (CPC)—the branch of the city’s police oversight system tasked with gathering community input on police reforms—are wary of wading into electoral politics.

Reverend Harriet Walden, the commission’s longest-serving member, also opposed the candidate forum. “It’s not part of our mission,” she said.

During the CPC meeting Wednesday, CPC communications director Jesse Franz described plans that are already underway for a general election forum that the CPC plans to co-host alongside a community organization involved in criminal justice reform, such as Choose 180 or Community Passageways.

But some prominent members of the commission pushed back on the plan. Suzette Dickerson, who will represent the CPC during contract negotiations with the Seattle Police Officers Guild next year, argued that hosting a candidate forum was outside the scope of the CPC’s responsibilities. From her perspective, the commission’s role is to be a sounding board for Seattle residents’ opinions on reforms to SPD; “stepping into the political arena,” she argued, would undermine public trust in the commission.

Reverend Harriet Walden, the commission’s longest-serving member, also opposed the candidate forum. “It’s not part of our mission,” she said, adding that she isn’t confident that the CPC would allow community groups opposed to downsizing SPD to have a voice in the forum. “I think that we’re headed down a path to help social engineer the defunding the police department,” she said.

The commission’s current leaders, however, supported the idea. “To me, holding a candidate forum seems within the scope of ensuring that the community is informed about what accountability may or may not look like, in particular candidates minds,” said CPC co-chair LaRond Baker.

Though the CPC can’t endorse candidates, the commission is not a neutral player in the police oversight sphere: It recommends reforms to SPD and Seattle’s police oversight system. Recent CPC recommendations have included a ban on tear gas and removing limits on the number of civilian investigators in the Office of Police Accountability. The success of those recommendations depends on the support of the mayor, the council, and the police chief, which gives the CPC a clear stake in the outcome of the election.

“Opponents have been using increasingly violent tactics against our signature collection teams,” the solicitation for funds claims. “We must persevere, and we need your help to ensure we reach 33,060 signatures by June 25.”

3. In a fundraising email Tuesday, the Compassion Seattle campaign, which is gathering signatures to get its charter amendment on homelessness on the November ballot, claimed that several of its paid signature gatherers have been attacked by people who oppose the initiative.

“Opponents have been using increasingly violent tactics against our signature collection teams,” the solicitation for funds claims. “We must persevere, and we need your help to ensure we reach 33,060 signatures by June 25.” Continue reading “State Goes on Offensive to Save Capital Gains Tax, Police Oversight Group Considers Candidate Forum, and Compassion Seattle Plays Victim”

Advocates Say It’s Time to Ditch the Old Transportation Funding Process

Anna Zivarts, Disability Rights Washington

by Leo Brine

Transportation advocates were actually pleased when lawmakers ended the most recent legislative session without passing a new transportation package.

After the transportation committees released their proposed revenue packages late in the session, transportation accessibility groups and environmentalists were disappointed by the outdated investment priorities. Wanting a more equitable transportation package, advocates repeated a line of critique they’ve been making for years: The state needs to find new transportation revenue sources and free up revenue that is otherwise restricted to highway spending.

However, and perhaps because their recommendations have gone unheeded for a decade, a new, more sweeping critique emerged in 2021: It’s time to dump the whole politicized “transportation package” model and create a new framework that assesses and prioritizes the state’s actual transportation needs.

Anna Zivarts, Director of the Disability Mobility Initiative for Disability Rights Washington, said the current system is a “pork model,” where legislators pick projects for their districts rather than investing in projects that make the whole state transportation system function better.

“A transportation system has to work across the state,” she said. “If you have everyone competing, that’s not going to create the best system overall.”

Advocates say lawmakers have too much power over which projects get funded and have political incentivizes to fund major highway expansion projects rather than expand transit services or improve pedestrian infrastructure. Featuring friction over projects, funding, regionalism, mode split, and maintenance versus new construction, the legislative ritual, akin to passing a kidney stone, played out in 2003, 2005, and 2015.

A new, more sweeping critique emerged in 2021: It’s time to dump the whole politicized “transportation package” model and create a new framework that assesses and prioritizes the state’s actual transportation needs.

In April, during the last weeks of the session, the House and Senate transportation committee chairs, Rep. Jake Fey (D-27, Tacoma) and Sen. Steve Hobbs (D-44, Lake Stevens), shared their transportation revenue proposals. The House proposal would have spent $22 billion over 16 years, earmarking the majority of the dollars for highway projects, with about 20 percent going to multimodal projects. The Senate’s proposal would have spent $18 billion over the same period, with less than 10 percent going to multimodal projects.

Leah Missik, transportation policy manager for Climate Solutions, said lawmakers’ proposed investments in multimodal projects were a major step up from previous packages, but “continuously investing in road expansions is certainly not the way we want to go.”

In order to fix the state’s transportation system, Paulo Nunes-Ueno of Front and Centered, a BIPOC environmental group, said, “this package process needs to go.”  Transportation packages never meet people’s needs and are a hodgepodge of project ideas from legislators, he said. Instead, Nunes-Ueno says lawmakers should establish climate, infrastructure, and safety goals, and allocate funding to state and local agencies that would decide how to allocate funding on projects.

Hester Serebrin, policy director for the Transportation Choices Coalition, said politics play too great a role when lawmakers craft transportation packages. She said lawmakers are more likely to invest in large projects, like highway expansions or major road repairs, because they garner more attention than smaller multimodal projects. “This process doesn’t incentivize … projects that help people travel between places,” Serebrin said. “Instead it incentivizes larger, geographically isolated projects.”

Other advocates agree that politics should play less of a role in the state’s transportation system. Vlad Gutman, Climate Solutions’ Washington director, like Nunes-Ueno, wants legislators to devise a set of goals and values for Washington’s transportation infrastructure and allocate funding to state agencies who can come up with projects and programs to accomplish the goals.

In order to fix the state’s transportation system, Paulo Nunes-Ueno said, “this package process needs to go.”  Instead, Nunes-Ueno wants lawmakers to set climate, infrastructure, and safety goals and allocate funding to state and local agencies.

“We need to be selecting projects and investing and designing our transportation system in a sort of objective, metric-based way that also recognizes and inputs the needs of communities and people who are impacted and stakeholders of transportation,” he said.

To do so, he argued, the Washington State Department of Transportation (WSDOT) should study the needs of the state and select projects based on those needs, “instead of [lawmakers] sort of piecemealing it by selecting projects one at a time,” Gutman said.

This participatory approach to transportation planning doesn’t make sense to Senate Transportation Chair Hobbs. “We’re in a democracy and legislators have a right to say how their districts should be supported by government,” he said.

Continue reading “Advocates Say It’s Time to Ditch the Old Transportation Funding Process”