On June 23, Seattle Mayor Jenny Durkan released her 2020 rebalanced budget proposal to close a $378 million budget shortfall. Kevin Schofield, at SCC Insight, has a helpful breakdown of the proposal here.
I appreciate that the Mayor’s proposal balances the 2020 budget without proposing new revenue, in part because the City Budget Office has said there is no way to collect new revenue this year. The Mayor has proposed difficult decisions and she deserves appreciation for her effort to govern in a fiscally responsible manner.
We will be watching to see how City Council receives the Mayor’s proposal. So far, Council seems focused on passing Councilmember Teresa Mosqueda’s proposal to tax businesses, which would generate new revenue for new spending and not address the budget shortfall this year or next. This isn’t fiscally responsible nor is it realistic.
While I appreciate Councilmember Mosqueda’s willingness to engage with a range of stakeholders about her new tax proposal, the Chamber does not support this proposal.
In response to the proposal, Alicia Teel, our Senior Vice President of Public Affairs and Communications said, Our region is in severe economic shock. We need leaders to focus on an equitable and inclusive economic recovery that gets businesses back open and people back to work. It’s still not clear how long impacts like job losses are going to last, and many businesses in Seattle and throughout our region are not in the same place they were at the start of the year. Policy proposals should reflect that reality. This conversation about public budgets and revenues is bigger than just Seattle and should happen at the state level. A new city tax on businesses at this moment will not help economic recovery.
For more information on Councilmember Mosqueda’s proposal, here’s a primer.
Our Executive Committee has convened a member-led Fiscal Analysis Task Force to conduct an independent and objective data analysis of the city’s spending and revenue base and ask critical questions of public accountability regarding limited tax revenues and productivity of public services. The City’s budget is complex in any year, but especially now, and we need to educate ourselves and our members about the budget so we can make informed recommendations and advocate for them.
At the state level, the latest revenue projections show a $8.8B budget deficit through 2023. Crosscut reports that Democratic legislative leaders expect some combination of spending cuts and new revenue to deliver a balanced budget.
As Alicia said, we believe the state level is the right place to have conversations about new revenue. To help prepare the Chamber to engage productively in those conversations, our Policy Leadership Group has created a member-led tax force, and we will continue to gather members, input on this topic through our process.
As a business advocate, the bottom line is that policies need to make our region more economically competitive, equitable, and resilient. Proposals should not jeopardize economic recovery, and we are committed to continuing to advocate for an approach that sets our region up for a stable and inclusive future.
