After hours of fighting over which programs deserve the City's precious dollars in the 2023-2024 budget, the Seattle City Council voted 3 to 5 against an increase in the payroll tax, aka the “JumpStart” tax. Sponsored by resident socialist Council Member Kshama Sawant, the small bump on the big business tax would have raised enough money to cover the troublesome $140 million budget hole that the council, the Mayor, and even big business agree needs to be filled with revenue from progressive taxes.
Still, Council Members Dan Strauss, Andrew Lewis, Alex Pedersen, Debra Juarez, and Sara Nelson voted against the increase without explanation. Council Member Lisa Herbold abstained, also without comment. I emailed all six council members to ask why they did not support raising the tax to eliminate the shortfall. No one answered by press time, but I will update if I hear back.
On Monday, in the last opportunity to make changes to the budget, Sawant challenged what she called “a false narrative” about budgeting in the face of a shortfall. As Mosqueda had reiterated several times, she would not call her budget an “austerity budget” because it does not lay off anyone, nor does it end any existing programs. However, she also made it clear that the City could not fund “nice-to-have” suggestions from the Mayor or council given the City’s financial situation, even though, as Strauss said on behalf of the council in the Monday meeting, “We wish we could fund everything under the sun.”
Sawant proposed a plan to make that “wish” a reality. As she said, “Austerity is not inevitable. It is thrust upon working people by a political establishment that stands with big business.”
Sawant’s amendment would increase the payroll tax on big business in Seattle by about 47%. For companies in the lowest JumpStart tax bracket–a payroll of $7 million to $100 million, where employees earn between $150,000 and $400,000–Sawant’s amendment would increase the current tax from 0.7% to 1.03%. For companies in the highest bracket–a payroll of more than $1 billion, where employees earn more than $400,000–the amendment would bump the current tax from 2.4% to 3.54%.
Sawant characterized the tax as “minuscule.” Even though she has reviewed the tax rates countless times, she said she still found herself pausing to make sure she read them correctly because working people “don’t deal with those kinds of fractions of taxes.”
The tax increase would pay for safety repairs to sidewalks, repainting bridges, upgrading library buildings, meeting ADA standards, three new tiny shelter villages, the Low Income Housing Institute’s plan to buy a hotel for non-congregate shelter, the Seattle Department of Transportation’s emergency response plan, the Mayor’s proposed investment in the emergency fund, and other needs the council said the City could not afford.
Initially, the council earmarked JumpStart revenue specifically for affordable housing, Green New Deal policies, and small business support, but mayors have made a habit of raiding the fund to fill in budget gaps in their proposals. Sawant simply suggested the council commit to taxing big business to fund more programs.
“So, the crisis is not a mathematical fact or an objective truth. It is simply a question of political will,” Sawant said before the vote.
Morales was the only council member to comment on Sawant’s proposal in the meeting. She said the City faces “overlapping crises,” and currently it chooses not to generate the revenue to fully address them.
Morales said she still looks forward to the recommendations of the Progressive Revenue Stabilization Work Group in the spring, but she reminded the council that the 2018 task force already gave the City recommendations it could implement sooner. Until the council acts on recommendations from either of those work groups, Morales said the council should approve an increase to the tax that has already demonstrated its ability to provide for Seattle’s most vulnerable.
In a phone interview last month, Mosqueda, who did not comment on the amendment but who voted to pass it, shared a similar perspective. She said she wouldn’t rule out increasing JumpStart when asked about Sawant’s initial plan to increase the tax by about 40% to make up for the $95 million that the Mayor raided from the revenue stream. Mosqueda, who chairs the Progressive Revenue Stabilization Work Group, said she didn’t want council members to use the existence of the task force as a reason not to propose progressive taxes, recognizing the urgency of the City’s revenue issues.
During the vote, no one else spoke. They just voted no, even though the money could have saved the programs they had just spent hours begging their colleagues to fund at the expense of others. Nelson and Pedersen both proposed several budget amendments that failed because they did not provide a plan to balance them. They would rather protect big business than actually fund the things they say they care about.
Similarly, Lewis lost the fight for $500,000 for an elevator in Pike Place because he proposed dipping into emergency funds, a reduction that Sawant said her tax increase would have made up for.
Hope Amazon sees this, bros, because this vote could cost the Democrats support from Seattle’s left. Throughout the budgeting process, a group of progressive organizers called the Solidarity Budget has asked lefties to challenge Democrats who squash progressive policies in the 2023 elections.
While one faction of Seattle’s left looks at taking the electoral route to power, Sawant called on everyday, working class people in Seattle to “force the council’s hand” by creating a progressive taxation movement of the kind Socialist Alternative built around taxing Amazon.