“Danbo Mini :: Starbuck,” Skyfish81

February 5, 2020; KOMO News (Associated Press) and Seattle Times

A new attempt to impose a special big business tax on Seattle-area companies appears to be gaining traction in King County. A similar measure was passed and rescinded less than a month later in the city of Seattle after Amazon and Starbucks campaigned against the new law. But now, five mega-corporations, including Amazon and Starbucks, along with Microsoft and Alaska Airlines, jointly signed a statement on Tuesday that says, in part, “We think the most high-impact way to contribute to meet those needs is in the form of a new business tax.”

Contained in House Bill 2907 (HB2907) is authorization for King County to assess an annual payroll tax on companies operating there, with higher rates imposed for more highly paid workers. The bill would create, as Daniel Beekman in the Seattle Times details, “a payroll tax of 0.1 percent to 0.2 percent on compensation paid by businesses to employees making at least $150,000 a year, with exemptions for small businesses, government entities and some other companies. The money would be used to fund affordable housing, homeless services, behavioral health services and related public-safety services, and much of it would flow through the regional homelessness authority.”

The King County measure is expected to raise $121 million a year countywide, which is more than the Seattle-only measure defeated last year would have raised, but far less than the $500 million advocates such as Seattle Councilor Kshama Sawant have advocated. Another part of the deal: passage of the bill would preempt any ability for Seattle city voters to enact their own tax measure.

These caveats aside, the bill does makes a sweet kind of sense in an area where local residents have been priced out of their own housing markets. The fact that the money will be slated to address homelessness and related issues suggests that maybe this ought to have been done sooner.

San Francisco voters approved a ballot to institute a similar tax in San Francisco in 2018. But the way the King County bill has been constructed may create some barriers if some smaller local cities have anything to say about it. They made themselves heard at a recent legislative hearing, claiming they were excluded from the bill’s development and that businesses in their communities are left footing the bill for a tax that will largely be spent elsewhere in the county, where more homeless people live.

Another joint statement, released yesterday by King County Executive Dow Constantine and Seattle Mayor Jenny A. Durkan, also expresses support for the bill, suggesting that even if there’s no slam dunk here, critical mass may be gathering.

“We thank legislators in Olympia for recognizing that regional need and for bringing forward a progressive new funding tool for King County—and we encourage them to act with urgency. We also appreciate this opportunity for productive discussions with legislators, community members, philanthropy, service providers, businesses, and labor organizations. We believe that, working together, we can implement proven strategies that allow everyone in our community to thrive.

Because of our regressive tax code, King County has limited revenue options. This crisis demands more tools for the region outside of property and sales taxes. Many of the region’s largest businesses, with deep roots in our community, want to participate in solutions, and want to do so with a comprehensive, countywide approach to homelessness, housing, behavioral health, and public safety. We agree, and this bill is a strong step in that direction.

We know more input and ideas will help make this bill better, but we cannot miss this moment to act.

An executive hearing on this bill is set for February 7, 2020.—Ruth McCambridge