Category: Taxes

City Council, Elections, homelessness, King County, Mayor Harrell, Taxes

This Week on PubliCola: July 5, 2025

King County assessor jailed, new public safety sales tax could pay for treatment, and a longtime youth homelessness provider is in tumult.

By Erica C. Barnett

Monday, June 30

Head of Downtown Business Group Lobbied for Digital Kiosk Company; Education Levy Will Help Backfill City’s Budget Deficit

Sung Yang, the board president for the Downtown Seattle Association, is also a registered lobbyist for IKE Smart City, the company that just brokered a deal to install digital ad kiosks that will benefit the DSA financially throughout downtown Seattle. And: The city’s families and education levy is supposed to fund preschool and other additive education improvements, but this year’s will also fund programs previously paid for out of the city’s general fund.

Seattle Nice: What’s Behind the Proposed New Business Tax?

On this week’s podcast, Sandeep and I discuss the proposed ballot measure to increase business and occupation taxes for the highest-grossing businesses—why it’s happening, why it’s happening now, and what it could mean for this year’s elections.

Tuesday, July 1

Local Public Safety Sales Tax Increase Could Include Some Treatment Funding (In Addition to Cops)

City Council President Sara Nelson, anticipating Mayor Bruce Harrell’s introduction of a 0.1-cent sales tax increase for public safety, is proposing that up to 25 percent of the new tax go to addiction treatment; precisely what kind of treatment the tax would fund remains up in the air.

Thursday, July 3

County Assessor Wilson Jailed on Allegations of Stalking, Violating Protection Order

After PubliCola broke the news that county assessor and King County executive candidate John Arthur Wilson had been jailed for stalking his ex-partner, Lee Keller, at her home, we updated this post to include details from Wilson’s bail hearing at the downtown jail, at which Keller spoke about her fear that Wilson would continue to violate her no-contact order against him.

Campaign Fizz: Mallahan Says He Voted GOP in Hopes of Hurting Trump, Sawant Proposes “Battering Ram” Free Health Care Initiative

Accused of voting Republican by the Harrell campaign, mayoral candidate Joe Mallahan first said the accusation was false, then recalled that, actually, he did vote for Tulsi Gabbard in the 2024 primary. And former councilmember (and current Congressional candidate) Kshama Sawant registered a campaign for a local health care initiative her political party has described as a “battering ram” to push nationwide universal Medicaid.

Amid a Long-Brewing Financial Crisis, Homeless Service Provider YouthCare Shuts Down Services, Fires Executive Director

YouthCare, the 50-year-old nonprofit dedicated to ending youth homelessness, has taken drastic actions in recent months to address a financial crisis—laying off a quarter of its staff and closing or consolidating standalone shelter and housing programs. Former staff critical of the agency worry that Youthcare is focusing too much on a future workforce-training hub, the Constellation Center, and not enough on its core mission.

 

Addiction, City Council, Mayor Harrell, Taxes

Local Public Safety Sales Tax Increase Could Include Some Treatment Funding (In Addition to Cops)
L-R: Ballard Alliance director Mike Stewart, Evergreen Treatment Services CEO Steve Woolworth, Council President Sara Nelson, We Heart Seattle director Andrea Suarez, Purpose Dignity Action deputy director Brandi McNeil

By Erica C. Barnett

Standing in Occidental Square on Tuesday morning, City Councilmember Sara Nelson announced a proposal to earmark 25 percent of a forthcoming one-cent sales tax increase to “evidence-based treatment” programs for people with addictions, name-checking Lakeside Milam, the residential treatment center in Kirkland, as an example.

“What I’m fighting for is simple, and it’s to put treatment at the heart and the center of the city’s policy agenda,” Nelson said. “We can’t keep deferring investments in treatment while watching the same people cycle through homelessness, overdose, emergency roomsm and jail over and over and over again.”

Nelson’s office estimated that a 0.1-cent sales tax would bring in about $35 million each year, or a little under $9 million for treatment programs. “When we invest in getting people off the street and into treatment, we prevent crime, reduce emergency room responses and make every neighborhood safer,” Nelson said.

Purpose Dignity Action, which runs the LEAD diversion program and the CoLEAD encampment resolution program, showed up to support Nelson’s proposal. The group, which hasn’t always seen eye to eye with Nelson, has adapted repeatedly to Seattle’s changing political climate, most recently embracing changes to the city’s drug laws that effectively forced LEAD to reverse its approach and go back to partnering directly with police to get new clients, rather than relying on community referrals, which don’t require an arrest.

“To be clear, any serious public safety system must prioritize how we responded with complex behavioral problems, especially when those needs are contributing to harm or distress in neighborhoods and business districts,” PDA deputy director Brandi McNeil said Tuesday. “Ignoring that reality only prolongs the cycle. Confronting it head on is how we build safer, healthier communities.”

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The state legislature gave cities and counties the authority to pass a 0.1-cent tax increase for public safety, including behavioral health care programs, earlier this year, and King County is considering its own version of the tax. Unlike a separate proposal to increase business and occupation taxes on gross receipts above $2 million, the sales tax does not require voter approval; if both taxes pass, Seattle’s cumulative sales tax will rise to 10.55 percent, the highest combined sales tax in the country.

“Lending support for a sales tax increase is not something that I take lightly,” Evergreen Treatment Services director Steve Woolworth said. “However, if this tax to support public safety is adopted, I strongly support dedicating a portion of the revenue to funding low barrier shelter services, jail diversion and alternative response, and the coupling of behavioral health, permanent, and supportive housing.”

Nelson has expressed skepticism about harm reduction and housing first programs in the past, arguing that it’s time to “move beyond the harm reduction phase” toward abstinence-based recovery, which advocates often shorthand as “recovery” to distinguish it from models that try to reduce harm from drug use without conditioning treatment on total abstinence.

And although Tuesday’s speakers all represented groups that embrace harm reduction alongside traditional sobriety-oriented treatment like that offered at Lakeside-Milam, Nelson was flanked by a much larger contingent of allies from “treatment first” groups like We Heart Seattle, Battlefield Addiction, and The More We Love, whose leaders Nelson thanked in her remarks.

We Heart Seattle has not gotten any city contracts—yet—but The More We Love recently received nearly $600,000 after Councilmember Cathy Moore earmarked $1 million for the group. (The lower amount reflects the fact that the group didn’t sign its contract until earlier this month). The More We Love will use the money to expand its shelter in Renton, an abstinence-only facility that “exits” women and their children if they fail to to make it through abstinence-based treatment and stay sober after they graduate. In its contract, The More We Love calls this a “low-barrier, high-accountability” approach to helping victims of sexual exploitation and gender-based violence.

Just before Nelson’s press conference started, the US Senate passed a budget bill that will impose work requirements on Medicaid recipients, depriving millions of Americans of behavioral health care and treatment.

The state law giving cities the authority to pass public-safety sales taxes does not dictate how much has to go to police, behavioral health care, or other programs. In other words: There’s nothing in the authorizing legislation that says 100 percent of the money can’t go to behavioral health care, as opposed more spending on the police department, which already makes up an overwhelming plurality of the city’s budget. Nelson and Mayor Bruce Harrell are among the city’s most ardent proponents of police spending, so it’s unlikely that either will propose increasing the 25 percent cap in Nelson’s bill, though another city councilmember (hi, Alexis Mercedes Rinck!) could.

Asked if she had Harrell’s support for her proposal, Nelson said, “The mayor has indicated support of the principle, of the idea, and it will have to wait until we get closer to the to budget to figure out what, what the departments are proposing for reductions” before talking about how to spend the tax.

Asked if Harrell supported Nelson’s proposal, a spokesperson for the mayor said, “We’ll analyze this proposal in full when we receive it in the context of the overall budget, revenue solutions, and public safety needs.”

Business, City Council, Elections, Mayor Harrell, Taxes

Seattle Nice: What’s Behind the Proposed New Business Tax?

By Erica C. Barnett

This week, we’re talking taxes—specifically, the new business and occupation (B&O) tax proposal that City Councilmember Alexis Mercedes Rinck and Mayor Bruce Harrell dropped, seemingly out of the blue, last week. The tax includes a big exemption that the business community has been seeking for a long time; however, above that threshold—$2 million in gross receipts—the tax will go up substantially.

Because B&O taxes are based on gross receipts, they hit high-grossing, low-margin businesses like restaurants and grocery stores hardest, often leading to higher prices—which is one reason they aren’t generally considered progressive. In fact, neither of the groups the city set up to come up with new progressive revenue sources recommended a higher B&O tax.

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On Monday, as I was posting the podcast, I received a poll testing messages for and against the tax measure. The Seattle Metro Chamber of Commerce is pushing the message that higher B&O taxes will drive up prices and drive larger businesses out of Seattle. “If the City continues to drive away large employers, it will create a domino effect hurting the small businesses this plan is supposed to help while also causing unemployment to rise, office vacancies to increase, and tax revenue to shrink,” one of the test messages claimed. The Chamber is also using some  dodgy math to claim that the city has more than $500 million just sitting around, up for grabs, so expect to hear that message when this thing goes to the ballot.

So what’s really behind the new proposal? The mayor’s up for reelection, facing a progressive challenge from Katie Wilson. Seattle’s facing a budget hole of $250 million even without federal cuts. And supporters of the tax measure may be gambling the Chamber won’t fight too hard against the tax, because it includes a big tax exemption that small- and medium-size businesses have been seeking for years.

With David still away gamboling in parts unnamed, Sandeep and Erica take up these questions and more on this week’s episode of Seattle Nice.

Business, City Council, homelessness, Mayor Harrell, Taxes

This Week on PubliCola: June 28, 2025
An IKE kiosk in Atlanta

State contracts go unpaid, the homelessness authority considers cuts, council approves digital sidewalk billboards, and more.

By Erica C. Barnett

Monday, June 23

Dozens of Digital Literacy Groups Funded Through a Statewide Grant Haven’t Been Paid Since January. The State Says It Isn’t to Blame.

We began the week with an in-depth feature about a statewide digital equity program, started during the pandemic to provide laptops and training in marginalized communities, that has not been able to pay its contractors for six months. The result: Small nonprofits, including some with just one or two employees, have been forced to shut down programs that help people exiting prison, non-English speakers, and folks living in isolated rural communities access the internet and learn digital skills.

Tuesday, June 24

Seattle Nice: Is It Time to Admit the King County Regional Homelessness Authority Is a Bust?

On this week’s podcast, we discussed the past, present, and future of the King County Regional Homelessness Authority, an agency established with the lofty goal of rebuilding the region’s homelessness system from the ground up. It hasn’t panned out that way.

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Wednesday, June 25

Towering Vertical Billboards Coming Soon to a Sidewalk Near You

The Seattle City Council approved a 30-year agreement to allow IKE Smart City, a Columbus, Ohio-based advertising company, to install 30 digital billboards, each 8’4” tall, on sidewalks throughout downtown Seattle, plus another 50 in other business districts across the city in the future. The Downtown Seattle Association, a private business group, will receive the profits from ad sales.

Thursday, June 26

Proposed Business Tax Increase Would Raise $90 Million a Year While Exempting Most Small Businesses

City Councilmember Alexis Mercedes Rinck and Mayor Bruce Harrell proposed a ballot measure that would increase the city’s business and occupation (B&O) tax rates while exempting gross revenues under $2 million, producing an estimated $90 million a year in new revenue to pay for housing stability, homeless services, food security, and small business sustainability.

Council Can’t Wait to Vote “Hell Yes” on Bills Cracking Down on Graffiti and “Nuisance” Bars and Clubs

The city council took up two bills designed to crack down on what Councilmember Bob Kettle calls the “permissive environment” in Seattle. One would empower the City Attorney to fine graffiti taggers and those who “encourage” them at a rate of $1,000 per tag. The second would give the city authority to penalize and shut down businesses because of crimes their patrons commit in “proximity” to their property, including misdemeanors like using drugs or drinking in public.

 

City Council, Elections, Mayor Harrell, Taxes

Proposed Business Tax Increase Would Raise $90 Million a Year While Exempting Most Small Businesses

By Erica C. Barnett

On Wednesday, City Councilmember Alexis Mercedes Rinck and Mayor Bruce Harrell proposed a ballot measure that would increase the city’s business and occupation (B&O) tax rates by about 50 percent and use the proceeds to fund programs that support housing stability, homeless services, food security, and small business sustainability.

The proposal, which could appear on the November ballot, would exempt businesses’ gross receipts up to $2 million, which would increase the number of businesses who don’t have to pay B&O taxes to about 16,500, or around 76 percent of businesses in Seattle. The remaining businesses would have to pay the tax on all revenues above $2 million. The exemption has been a longtime goal of the Seattle Metro Chamber of Commerce, which has argued that the current exemption is set too low, at $100,000, to provide tax relief to most of the city’s small businesses.

After accounting for the expanded exemption, which would cost the city about $30 million, the tax increase on larger businesses would bring in an estimated $90 million a year.

Speaking to PubliCola on Tuesday, Rinck acknowledged that the business and occupation tax is “not without shortcomings”— for instance, high-revenue, low-margin businesses like grocery stores and restaurants tend to increase prices in response to higher taxes, passing costs on to consumers. But, she said, the city is “looking at an urgent situation, where we’re being confronted with federal funding cuts” that stand to harm Seattle’s most vulnerable residents, including potentially steep reductions in federal spending on homelessness, housing, and human services.

“[The plan] creates some tax relief for small businesses, and it’s a really great opportunity for us to provide that support for small businesses while asking some of our large businesses to pay more of their fair share to keep the city running and help our most vulnerable neighbors,” Rinck said.

On Wednesday, Rinck said the tax increase, which she has dubbed the Seattle Shield law, will protect essential programs from Trump-era cuts. “And here’s what makes this moment special: We’re not imposing this on Seattle, we’re trusting Seattle,” Rinck said. “You choose whether we protect each other or abandon each other, and you choose what kind of city we want to be.”

State law prohibits the city from increasing the business and occupation tax without a public vote. One advantage of a voter-approved tax is that, unlike the council-approved JumpStart tax, it can’t be easily reallocated to new purposes based on the transitory whims of a mayor or city council.

The proposal includes specific spending categories—broadly, housing stability for low-income tenants; small business assistance; services for people facing homelessness, food insecurity, or gender-based violence, and protections for vulnerable workers through the city’s Office of Labor Standards. If the measure passes, these categories would have the force of law.

According to the most recent revenue forecast, the city is facing an unanticipated budget shortfall of more than $240 million over the next two years, with or without additional cuts to federal programs that fund services in Seattle.

The city has two business and occupation tax rates for different kinds of businesses; one, which applies to all retail businesses (and five other business categories) would increase from 0.222 percent to 0.34 percent if voters approved the new tax. The other, which applies to freight transportation and professional services, would increase from 0.443 to 0.65 percent.

By pairing a tax increase with a tax exemption, the proposal puts the reflexively anti-tax business community in a somewhat awkward position. In an email blast about the forthcoming proposal last Friday, Seattle Metropolitan Chamber CEO Rachel Smith praised the proposed exemption, while arguing that a new tax will harm Seattle’s economy and drive businesses away.

“While proposal details have not been released, one component would expand the B&O exemption for very small businesses with an annual gross under $2 million—a good policy that we support,” Smith wrote. “But taxing all of our other businesses to pay for it—when the city has $800 million in unspent revenue—is the wrong move.”

In a statement on Wednesday, Smith said the new proposal “has been rushed, [and] the beneficiaries and payers have not been sufficiently identified or engaged. Everyone deserves to understand the impact of any proposed tax restructuring with more than just 45 days of consideration before heading to the ballot.”

The Chamber’s $800 million estimate refers to the money allocated, but not yet spent, from the JumpStart payroll tax (which funds, among other things, the Equitable Development Initiative, programs to mitigate the impacts of climate change, and affordable housing); funds allocated by the Office of Housing through the voter-approved housing levy; and an estimated $200 million in budget funds that were allocated, but not spent, last year.

“Let’s be clear: Seattle isn’t facing a deficit, in fact, they can’t spend the money they have budgeted today,” Smith wrote.

Budget experts and proponents of the legislation confirmed that most of the money Smith identified can’t easily be moved from place to place—it isn’t possible, for example, to pull money allocated to a signed contract away from that project just because it didn’t get underway by the end of the year.

Additionally, the city’s annual “underspend” stretches across multiple city departments that have different reasons for failing to spend their full budget by the end of the year. It’s legitimate to ask city departments to explain why they aren’t spending all the money they get, and to establish polices to address this perennial issue, but the answers are bound to be complicated. Requiring city departments to unilaterally forego unspent money at the end of each year without knowing the reason each department ended up under budget could be a recipe for budget chaos.

Harrell, whose 2021 run for mayor got a big boost from Chamber members like Vulcan and Goodman Real Estate, stands to benefit politically from allying with Rinck on the taxing measure even as he risks pissing off his deep-pocketed business backers: His leading opponent, Katie Wilson, is outflanking him on the left with a campaign focused on progressive revenue, housing abundance, and access to safe, reliable transit. Recent polling described to PubliCola suggests that Harrell is vulnerable to a challenge from the left.

Wilson, a longtime proponent for progressive revenue, said in a statement that she’s “glad that Mayor Harrell is backing this proposal coming from Councilmember Rinck’s office,” because it will help the measure move through the mostly Harrell-aligned council.

“It’s clear that Harrell is terrified he won’t win re-election and he suddenly feels the need to show progressive leadership,” Wilson added. “It’s disappointing that it takes the threat of being unseated for our mayor to do the right thing.”

While progressives who support raising revenue to preserve city services and respond to federal budget cuts argue that a higher B&O tax that exempts smaller businesses is progressive, the tax is generally considered regressive because it has a greater impact on smaller businesses and those that operate on slim margins, and because businesses generally pass B&O tax increases on to consumers in the form of higher prices. Exempting most businesses from the tax arguably eliminates the first problem, but it doesn’t directly address the second.

Complicating matters, the city is planning to take up separate tax increase soon: A 0.1-cent sales tax hike to pay for public safety, which the state legislature authorized earlier this year. King County is currently considering its own 0.1-cent tax increase; together, the two tax increases, which do not require voter approval, would increase the sales tax in Seattle to 10.55 percent, the highest combined sales tax rate in the country.

Asked about the potential sales tax increase on Wednesday, Harrell said it’s “on the table for discussion, but because we understand the regressive nature of it, we are treading very carefully.”

Mayor Harrell, Police, Taxes

SPD Celebrates Its Hiring Spree. The Only Thing That’s Missing: Women

By Erica C. Barnett

Mayor Bruce Harrell and acting Police Chief Shon Barnes touted SPD’s latest hiring numbers on Monday. Standing in a gym at SPD’s training facility in Georgetown, the two men stood in front of by 15 members of the Seattle Police Department recruit class of 2025—a group of people Harrell said “truly represent our community.”

One thing was notably absent in the backdrop of new recruits: Women. SPD, which is facing multiple lawsuits from women alleging gender discrimination and harassment, has frequently said that recruiting more women is a top priority, but the department has not announced any specific efforts to improve the department’s well-documented culture of misogyny.

In 2021, SPD signed the “30 by 30” pledge, committing to have a 30 percent female recruit class by 2030.

To say they’ve failed to make progress is an understatement. Last year, SPD only managed to hire 12 women—just 14 percent of its 84 new hires. This year, that figure has dropped to just eight percent—an abysmal five women out of 60 officers hired so far this year.

Perhaps it’s unsurprising that a city so hyperfocused on increasing the number of bodies in police uniforms has failed to register alarm that almost all those new bodies are male. If your whole pitch for SPD is that you can make six figures and get a hiring bonus, you probably aren’t going to reach people who aren’t considering a job in law enforcement in the first place, particularly those who have heard about SPD’s reputation as a place where women get harassed and overlooked.

Still, it was a bit of a visual jump-scare to walk into SPD’s training facility and see that the city had chosen a phalanx of preternaturally buff young men to serve as the visual backdrop for their big hiring announcement. (One young woman became visible in the back of the group partway through the press conference.)

I asked Barnes—who received wide praise in Seattle for maintaining a better gender breakdown  at the Madison, WI police, where he was chief before coming to Seattle—what the department was doing to address its male-dominated culture and proactively recruit more women. (Barnes had just finished telling three brief anecdotes in which various men expressed an interest in becoming a Seattle police officer to him personally).

“I looked at those numbers, and those numbers are not exceeding my expectations,” Barnes said. “Last year we hired 10 females,” he continued, misspeaking slightly. “This year we have five. So we still have some work to do on that.”

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“Maureen McGaugh”—the founder of 30 By 30— “is a close personal friend of mine,” Barnes continued. “And so I had a conversation this morning with staff about making sure that we give a second look to any female applicant before we give them a rejection letter—like, what’s going on there?”

“But you know, a lot of police departments struggle with” hiring women, Barnes said. “I think for me, it’s making sure that any applicant, no matter your demographics, you know that Seattle Police Department has a place for you.”

Overall, the 60 new hires represent a net increase of 36 officers, after factoring in 24 departures so far this year.

The police department remains by far the biggest portion of the city’s general fund budget. On Monday, Harrell said he would consider the new option of a 0.1 percent sales tax for public safety that the state legislature approved last week, using public safety as the “lens by which we will make decisions” on the upcoming budget. “That doesn’t mean that housing and child care and education and other climate change, the other strong components of our ecosystem, are not important,” Harrell said. But, he added, “we have to center public safety to make sure that our kids are safe.”

The local-option tax has to be spent on criminal justice, but the legislation adopts an expansive definition of that term that includes diversion, public defense, and prevention programs, which King County Councilmember Girmay Zahilay said he would want to fund, in addition to more prosecutors and cops, if the county passes their own version of the tax.

The city is facing a projected budget shortfall of $241 million over the next two years, on top of previous budget forecasts that showed growing deficits starting in 2026. Thanks to the council’s actions last year, the JumpStart tax, originally dedicated to four specific spending categories, is now an all-purpose bucket of money the city can slosh into the general fund at will, but the council may soon have to reckon with the volatility of a tax that depends overwhelmingly on fewer than a dozen companies.