Seattle Passes Tax on Big Business to Fight Homelessness

Jeannie Matthews
May 15, 2018

But the notion of the city council approving the reform which would raise taxes by $75 million annually is something that Amazon is not prepared to entertain which is why they have halted the construction plans and are willing to let go of the space they leased. Amazon on Monday declined further comment.

Following a weekend of negotiations between Seattle City Council members and Mayor Jenny Durkan, the council voted unanimously Monday to adopt a new tax on the city's largest employers to help address homelessness.

Under the ordinance, for-profit companies that gross at least $20 million in Seattle will pay the tax. So unless the state's Attorney General really does start charging companies with felonies for leaving Seattle, this tax is going to slow the growth of jobs in the city. Under the amendment, the tax expires after five years with the option to renew it. Kshama Sawant was the only councilmember to vote against the amendment, but voted in support of the final tax after the smaller version was approved by her colleagues.

Other cities have implemented similar taxes, but critics say Seattle's tax could threaten the booming local economy and drive away jobs.

"Big businesses like Amazon have many tactics to avoid paying their fair share of taxes, and it has required true dedication and sacrifice from hundreds of us to bring us to this point". Construction workers took that as a threat to their livelihoods since they're the ones who are building the offices. The e-commerce giant paused construction on one of its office towers and said it is reconsidering occupying another. Amazon is in the midst of an expansion in the city that would create an additional 7,000 high paying jobs. Amazon's plans in Seattle after today's vote are not clear.

Other unions, including the Service Employees International Union, supported the tax.

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The city's homeless population is growing, behind only NY and Los Angeles. "Because every city is facing a housing and homelessness crisis". United Way of King County spent around $6.5 million in 2017. The Seattle region had the third-highest number of homeless people in the US and saw 169 homeless deaths in 2017.

Starbucks spokespersron John Kelly, Starbucks' senior vice president of global public affairs and social impact, said the city hasn't been accountable enough to prove it can use the money wisely.

Meanwhile, median cost of a single-family house in Seattle rose 110 percent since Amazon opened its headquarters in 2010, according to The Seattle Times.

Mayor Jenny Durkan said that Seattle now spends about $70 million in annual direct investments to programs that fight homelessness in her first State of the City address. Past year the city spent $68 million on homeless services.

The Seattle metropolitan area also is home to the third-largest concentrations of homeless people, nearly 12,000 counted in a January U.S. government survey, and almost half of them were living on the streets or otherwise unsheltered. The Durkan/Harrell plan also includes a four percent wage increase for social service workers (many of whom make just over $15 an hour) and funding for a second Navigation Team to remove tent encampments and refer their residents to services.

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