Dueling signs at City Hall over the head tax.
Dueling signs at City Hall over the head tax. SH

The Seattle City Council is moving quickly on a $75 million employee hours tax to fund housing and homelessness services.

The challenge for council members over the next couple days will be working out a plan that can get Mayor Jenny Durkan’s support or at least a veto-proof majority. A final vote could happen as soon as Monday.

Durkan said Wednesday she doesn’t support the tax in its current form, calling for a review after five years.

During a special committee meeting, council member Lorena González, one of the co-sponsors of the legislation, said she and her colleagues are considering an amendment that would put the tax up for review after a “set number of years.”

Under the current proposal, the city would impose a tax of about $500 per employee on for-profit businesses grossing more than $20 million annually. In 2021, the city would switch to a .7 percent tax on payroll for the same businesses. City staff estimate both taxes will generate about $75 million of revenue for housing and homelessness services.

On top of a sunset clause, González said the co-sponsors are also considering doing away with the payroll tax and just having an employee hours tax.

Under a spending plan that is still in the works, about 75 percent of the new revenue from the tax would go towards building and operating affordable housing. Twenty percent would be allocated towards shelter and services. The rest of the funds would go towards start-up and administrative costs.

González, Teresa Mosqueda, Mike O’Brien Lisa Herbold, and Kshama Sawant support the tax.

The five confirmed “yes" votes mean the proposal will likely pass the council. But they would need one more vote to override a potential veto from Durkan.

During yesterday's committee meeting, Bruce Harrell and Debora Juarez expressed skepticism of the tax rate. Both made comments suggesting $500 per employee is too high.

Sally Bagshaw and Rob Johnson have been noncommittal.

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The head tax has given Seattle one of the most divisive political moments in recent years. The saga reached a dramatic climax last week, when Amazon announced a halt in construction of downtown office buildings pending the council’s vote on the head tax. Company representatives said 7,000 jobs are on the line. Some public officials and advocates characterized Amazon's move as a threat. Later that same evening, opponents of the tax shouted obscenities at officials during a public forum in Ballard.

The tax has also driven a wedge through labor groups. Big unions, including organizations representing nurses, educators and grocery store workers, support the plan. But unions representing ironworkers and carpenters oppose it on grounds that it may affect their jobs. Responding to these concerns, council member Mosqueda introduced an amendment that would help secure jobs for affected workers on new housing projects resulting from the spending plan.

This article was originally posted at 7:31 a.m.