>>> GOOD MORNING, THE SPECIAL
SELECT BUDGET COMMITTEE WILL
COME TO ORDER. IT IS 9:31 A.M.
I AM DAN STRAUSS, CHAIR OF THE
COMMITTEE. SELECT COMMITTEE.
WILL THE CLERK THE ROLL?
COUNCILMEMBER KETTLE?
>> HERE.
>> COUNCILMEMBER MOORE?
COUNCILMEMBER MORALES? COUNCIL
PRESIDENT NELSON?
>> PRESENT.
>> COUNCILMEMBER SAKA,
COUNCILMEMBER WOO,
COUNCILMEMBER HOLLINGSWORTH.
>> PRESENT.
>> AND CHAIR STRAUSS.
>> SIX PRESENT.
>> THANK YOU. WE ARE ALSO GOING
TO OPEN THE OCTOBER 22nd
SPECIAL MEETING OF THE ECONOMIC
REVENUE FORECAST COUNCIL. THE
COUNCIL WILL NOW COME TO ORDER.
THE TIME IS 9:32 A.M.
COUNCILMEMBER MORALES IS
PRESENT FOR SELECT COMMITTEE.
I'M DAN STRAUSS, CHAIR OF THE
ECONOMIC REVENUE FORECAST
COUNCIL JOINED BY MEMBERS OF
THE FORECAST COUNCIL, CITY
COUNCIL PRESIDENT SARA NELSON,
THE CHIEF OF STAFF. WE HAVE ALL
THE CITY COUNCIL MEMBERS
JOINING US IN REALTIME TO
RECEIVE THIS CRITICAL
INFORMATION TODAY. WE ALSO HAVE
COUNCILMEMBER WOO PRESENT. SO I
BELIEVE THAT THE SELECT
COMMITTEE IS NOT ACCEPTING
VERBAL PUBLIC COMMENT TODAY.
YOU CAN SUBMIT PUBLIC COMMENT
BY EMAILING THE COUNCIL AT
COUNCIL@SEATTLE.GOV AS WELL AS
THERE ARE PUBLIC COMMENT CARDS
LOCATED NEAR THE PODIUM. YOU
CAN ALSO REACH THE FORECAST
COUNCIL AT FORECASTOFFICE@SEATT
LE.GOV. SO, COLLEAGUES, WHERE
WE ARE TODAY, IN THE PREVIOUS
MEETINGS WHEN I HAVE HAD THE
FORECAST COUNCIL, THE FORECAST
OFFICE COME TO THE SELECT
BUDGET COMMITTEES THERE WAS A
LOT OF DUPLICATIVE
PRESENTATION. SO BECAUSE OF
EVERYONE'S GREAT INTEREST, WE
ARE JUST DOING IT ALL TOGETHER
TO COME TO THE INFORMATION
PRESENTED AT THE SAME TIME. WE
HAVE EQUAL ACCESS TO ASKING THE
QUESTIONS AS WELL AS EQUAL
ACCESS IN TIMING OF RECEIVING
THIS INFORMATION. I HAVE JUST
RECEIVED THIS INFORMATION THIS
MORNING. IT'S NOT GOOD. WE
WILL GET INTO IT. AND
COLLEAGUES, ALSO, THE
PRESENTATION WAS EMAILED TO YOU
THIS MORNING BY JAN DURAS.
IT'S AT THE TOP OF THE YOUR
INBOX AT 9:29 A.M. I WILL PASS
IT TO JAN. I JUST WANTED TO GO
THROUGH SOME OPERATIONAL
DETAILS. THE ECONOMIC REVENUE
FORECAST COUNCIL IS COUNCIL
PRESIDENT NELSON, MYSELF, RAKA.
WHEN WE ARE VOTING ON FORECAST
ITEMS, ONLY THESE FOUR PEOPLE
WILL BE CALLED. BECAUSE THESE
ARE THE ONLY FOUR MEMBERS OF
THE FORECAST COUNCIL. THE
FORECAST OFFICE IS AN
INDEPENDENT OFFICE FROM BOTH
THE MAYOR AND THE CITY COUNCIL.
THIS WAS A CHANGE MADE IN THE
PAST FOUR YEARS. IT HAD BEEN
PART OF THE CITY BUDGET OFFICE
AND NOW IS AN INDEPENDENT BODY
WHICH IS WHY THE FORECAST
COUNCIL IS SET UP BY JEREMY
RAKA AS THE VICE CHAIR. LET ME
DOUBLE CHECK THESE NOTES.
THANKS JEREMY. SORRY ABOUT
THAT. AND ME AS THE CHAIR.
THAT'S HOW THE OPERATIONS OF
GOVERNANCE OVER AN INDEPENDENT
BODY ARE OCCURRING. AND SO WITH
THAT, THE MAIN PURPOSE OF THE
MEETING IS FOR US ALL TO
RECEIVE THE UPDATED ECONOMIC
AND REVENUE FORECASTS TOGETHER.
AS THE CITY COUNCIL IS
REVIEWING THE MAYOR'S 2025,
2026 PROPOSED BUDGET. WE WILL
RECEIVE AND REVIEW THIS FINAL
REVENUE FORECAST UPDATE OF THE
YEAR. THIS IS ESPECIALLY
IMPORTANT BECAUSE IT SERVES AS
THE BASIS FOR THE ADOPTED
BUDGET. THE CHANGES WE WILL SEE
COMING FROM THE FORECAST OFFICE
TODAY ARE CHANGES FROM THE
PROPOSED BUDGETS. WE WILL GET
INTO MORE ABOUT WHAT THAT MEANS
SHORTLY. THE MAIN GOAL IS TO
INCREASE TRANSPARENCY AND
ACCOUNTABILITY AROUND THE
CITY'S REVENUE FORECASTING
PROCESS AND BUDGETING PROCESS.
THIS IS GOOD BUDGET REFORM. TO
ENSURE THERE IS NO POLITICAL
INFLUENCE ON THE FORECASTS
THEMSELVES WHICH IS WHY IT IS
AN INDEPENDENT BODY. THE STAFF
FROM THE CITY BUDGET OFFICE IS
ALSO PRESENT TODAY TO PROVIDE
BRIEFINGS REGARDING REVENUES
STILL IN THE PER VIEW OF THE
BUDGET OFFICE. AND SO WITH
THAT, I'M GOING TO ASK THE
CLERK TO READ THE FIRST ITEM
INTO THE RECORD.
>> ADOPTION OF ECONOMIC REVENUE
FORECAST, AUGUST 5th, 2024 FROM
POSSIBLE VOTE.
>> THANK YOU. AND ARE THERE ANY
ANY DISCUSSIONS ON THE MEETING
MINUTES? SEEING NONE, I'LL ASK
THE CLERK TO CALL THE ROLL. I
CAN SEE IF THERE IS NO
OBJECTION, THE AUGUST 25th
MEETING MINUTES WILL BE
APPROVED. HEARING NO OBJECTION,
THE MEETING MINUTES ARE
APPROVED. WILL THE CLERK READ
THE NEXT TWO ITEMS IN THE
RECORD AT THE SAME TIME?
>> AGENDA ITEM 2, ECONOMIC
REVENUE FORECAST AND
RECOMMENDATIONS ON THE 2024,
2025, 2026 ECONOMIC AND REVENUE
FORECAST FOR DISCUSSION AND
POSSIBLE VOTE.
>> THANK YOU. THE FORECAST
PRESENTATION WILL BE THE OFFICE
THE COUNCIL IS FULLY INFORMED
AND ABLE TO HAVE ITS FULL RANGE
OF QUESTIONS ADDRESSED, STAFF
FROM THE CITY COUNCIL CENTRAL
STAFF AND BUDGET OFFICE WILL
ALSO PARTICIPATE. THEY WILL
PRESENT BASELINE, PESSIMISTIC
AND OPTIMISTIC SCENARIOS AND
PROVIDE AN ASSESSMENT OF WHICH
SHOULD BECOME THE FORMAL
FORECAST. WE'LL HAVE THE
OPPORTUNITY TO DISCUS THIS
RECOMMENDATION AND WHETHER TO
AFFIRM IT OR CONSIDER A
DIFFERENT FORECAST SCENARIO.
WITH THAT, I WILL NOW PASS IT
OVER TO THE FORECAST OFFICE TO
INTRODUCE THEMSELVES WITH
DIRECTOR DURAS. WHEN YOU ARE
LOOKING AT THIS VERY LONG
PRESENTATION, A LOT OF, THE
FIRST NUMBER OF SECTIONS ARE
THE LEAD UP WITH THE
INFORMATION THAT INFORMS THE
CURRENT FORECAST AND THAT
CURRENT FORECAST IS AT THE END
SECTION. WITH THAT, DIRECTOR
DURAS?
>> GOOD MORNING FORECAST
COUNCIL MEMBERS AND CITY
COUNCIL MEMBERS. MY NAME IS JAN
DURAS, CHIEF ECONOMIST AT THE
FORECAST OFFICE.
>> HELLO EVERYBODY. THIS IS
SEAN THOMPSON.
>> AND I'M DAVE HENNES WITH
THE CITY BUDGET OFFICE.
>> JESUS SELL CITY BUDGET JOE
RUSSELL.
>> AND BEN NOBLE.
>> PLEASE SPEAK AS CLOSE AS
POSSIBLE TO THE MIC. THANK YOU.
>> ALL RIGHT. SO HERE'S THE
OUTLINE FOR THE PRESENTATION
TODAY. FIRST, WE ARE GOING TO
LOOK AT THE RECENT ECONOMIC
DEVELOPMENTS AND SUMMARIZE THE
CHANGES IN THE FORECAST FOR
U.S. AND FOR THE REGIONAL
ECONOMY. AS A REMINDER TO THE
PUBLIC, OUR FORECASTS ARE
ESSENTIALLY PREPARED IN TWO
STEPS. FIRST, WE ARE UPDATING
THE REGIONAL ECONOMIC FORECAST.
AND THEN, USING THE REGIONAL
FORECAST TO INFORM THE REVENUE
FORECAST. PRIMARILY BECAUSE
THERE ARE A LOT OF LARGE
ECONOMICALLY DRIVEN REVENUES
AND ANY CHANGES TO THE REGIONAL
ECONOMIC FORECAST THAT RESULT
IN CHANGES IN THE REVENUE
FORECAST. NEXT THE UPDATE ON
THE REVENUES. LOOKING AT
GENERAL FUND REVENUES AND
SELECTED OTHER GOVERNMENT
REVENUES. SO WITH THAT LET'S
LOOK AT THE CHANGES IN THE
ECONOMIC OUTLOOK FOR THE U.S.
AS A WHOLE. IN JULY, IT WAS THE
MIDDLE OF QUITE OF A TURMOIL. A
VERY TURBULENT WEEK. AFTER THE
REPORT FOR JULY CAME OUT AT THE
BEGINNING OF AUGUST, THE
IMPLEMENT REPORT CAME OUT.
THERE WERE FEARS OF A RECESSION
BECAUSE OF A WEEK THAT
EMPLOYMENT REPORT WAS. IT ALSO
LED TO EXPECTATIONS THAT THE
FED WOULD HAVE TO CUT INTEREST
RATES MORE AGGRESSIVELY. MOVE
FASTER. AND DO BIGGER CUTS TO
AVOID THE HARD LANDING TO AVOID
RECESSION. SO THAT IS EXACTLY
WHAT HAPPENED. IN SEPTEMBER,
FED DECREASED THE INTEREST RATE
BY HALF OF A PERCENT. CURRENTLY
THE EXPECTATIONS IS THESE WILL
BE FOLLOWED BY TWO ADDITIONAL
QUARTER CUTS IN NOVEMBER AND
DECEMBER. THAT WILL BE FOLLOWED
BY QUARTER CUTS. WE WILL SHOW
YOU WHAT THE FORECAST FOR
INTEREST RATE WAS BACK IN JULY.
THE RED LINE. AND THEN, THE
DARKER RED LINE THAT IS THE
CURRENT FORECAST. ESSENTIALLY
INCORPORATES THAT LARGE HALF A
PERCENT CUT. THE TWO ADDITIONAL
CUTS THIS YEAR. AND THEN, A
SIXTH ADISSAL QUARTER PERCENT
CUT THROUGHOUT 2026. BOTH OF
THOSE ARE BASELINE SCENARIO
FORECAST. AND WE ARE GOING TO
DISCUSS THE PESSIMISTIC
SCENARIO, TOO. IT WOULD ENTAIL
INTEREST RATES COMING DOWN
FASTER BECAUSE THE FED IS KIND
OF TRYING TO AVOID THE
RECESSION OR TRYING TO MITIGATE
THE RECESSION. BECAUSE
PESSIMISTIC SCENARIO ACTUALLY
HAS A RECESSION AS PART OF ITS
FORECAST. SO PESSIMISTIC IS A
HARD LANDING RECESSION
OCCURRING. TRYING TO STIMULATE
THE ECONOMY BY LOWERING
INTEREST RATES. OR RATES
FURTHER. SO IT IS NOT REALLY A
GOOD OUTCOME THOUGH IT MIGHT
SEEM IN SOME SENSE LOWER
INTEREST RATES ARE GOOD. BUT
NOT WHEN IT LEAD TO RECESSION.
SO OVERALL FED IS SUCCEEDING IN
TERMS OF SO FAR SUCCEEDING IN
TERMS OF BRINGING THE INFLATION
DOWN. THE DEMAND AND SUPPLY AND
THE LABOR MARKET ARE MOVING
CLOSER TO THE BALANCE. THE
NUMBER OF JOB OPENINGS PER
UNEMPLOYED PERSON IS ROUGHLY
WHERE FED WILL WANT TO SEE.
SOMEWHERE WHERE IT WAS RIGHT
BEFORE THE PANDEMIC. AS A
RESULT, THE PRESSURES ARE
EASING, NATIONAL HOUSING MARKET
IS COOLING DOWN. WE ARE SEEING
LOWER INFLATION FOR RENTS. AND
SO, THE REVISED FORECAST
ACTUALLY BRINGS DOWN THE
INFLATION FORECAST FOR 2024 AND
FIRST HALF OF 2025. YOU CAN SEE
THE FAINT RED LINE AND THE
DARKER RED LINE THROUGHOUT THE
REST OF 24 AND THE FIRST HALF
OF 23. AND THERE IS A BIT OF AN
INTEREST. A BIT OF AN INFLATION
INCREASE THAT FOLLOWS. BUT
EVENTUALLY INFLATION IS COMING
DOWN AND COMING TO THE FED'S
TARGET. PESSIMISTIC SCENARIO,
THAT'S THE CASE WHERE THE
INCREASED CONFLICTS IN THE
MIDDLE EAST LEAD TO HIGHER OIL
PRICES, HIGHER ENERGY PRICES
OVERALL. INFLATION THAT IS
HIGHER THE FED IS NOT GOING TO
FIGHT THE INFLATION WITH HIGHER
INTEREST RATE BUT TRIES TO
ACHIEVE OTHER MANDATES TO
STIMULATE THE ECONOMY AND LOWER
THE INTEREST RATES. THE
FORECAST FOR U.S. WE ARE
FOCUSING ON HERE IN THIS
PRESENTATION IS COMING FROM S&P
GLOBAL. THE MAIN INPUT FOR THE
WORK THAT WE DO WHEN WE ARE
DEVELOPING THE REGIONAL
ECONOMIC FORECAST. WE ARE
COMPARING THAT FORECAST WITH
ALTERNATIVE OR OTHER SOURCES OF
FORECAST FOR THE U.S. ECONOMY
FROM ANALYTICS IN PARTICULAR
AND COMPARING IT TO THE WALL
STREET JOURNAL ECONOMIC
FORECASTERS. THIS IS GOING TO
GET SOME SENSE OF HOW
CONSERVATIVE OR HOW OPTIMISTIC
THAT S&P GLOBAL'S FORECAST IS
WHERE WE ARE TRYING TO MAKE
SURE THAT THEIR BASELINE
SCENARIO OR ALTERNATIVE
SCENARIOS ARE NOT TOO FAR FROM
WHERE THE REST OF THE
ECONOMISTS ARE BELIEVING THE
U.S. IS HEADED. VOCATIONALLY
THINK ARE DIFFERENT OPINIONS
ABOUT HOW THE OUTLOOK FOR THE
NEXT TWO YEARS WILL LOOK LITHAT
ECONOMIST BELIEVES. THE
INFLATION. THE UNEMPLOYMENT
RATE AND THE REAL GDP GROSS
RATE IS GOING TO BE IN 2025.
FOR FEDERAL FUNDS RATE, IT'S
THE RATE AT THE END OF 2025.
AND SO, EACH DOT IS ONE OF THE
ECONOMISTS IN THE SURVEY. AND
HIGHLIGHTED ARE THE BLUE DOT
WHICH IS AVERAGE. OR MEDIAN IN
THAT SURVEY. THE RED DOT,
THAT'S THE S&P GLOBAL'S
FORECAST. AND THE YELLOW DOTS
ARE THE ANALYTICS FORECAST. ARE
THE WHAT THIS CHART IS IN
GENERAL SAYING IS S&P GLOBAL'S
FORECAST IS SLIGHTLY MORE
CONSERVATIVE. THAN ANALYTICS
FOR REAL GDP GROWTH. THE SORT
OF DIFFERENCE FOR THE OUTLOOK
WHEN IT COMES TO THE LABOR
MARKET. IT IS SLIGHTLY MORE
OPTIMISTIC. AND THEY BELIEVE
THAT THE UNEMPLOYMENT RATE IS
NOT GOING TO COME SIGNIFICANTLY
HIGHER THAN WHERE IT IS RIGHT
NOW. S&P GLOBAL ON THE OTHER
SIDE FORESEES FURTHER INCREASES
IN UNEMPLOYMENT. AND
UNEMPLOYMENT DRIVING TO 4.6 BY
2026. NOT THE PESSIMISTIC
SCENARIO. THE BASELINE SCENARIO
WHICH DOES FORESEE SOME
INCREASES IN THE UNEMPLOYMENT
RATE AS THE LABOR MARKET
CONTINUES TO BALANCE TO WHAT
WOULD BE LONGER. NOW, FOR
FEDERAL FUNDS RATE, IT IS THE
OPPOSITE. AND AGAIN, THAT'S
BECAUSE OF HOW MODEST ANALYTICS
AND S&P GLOBAL IS HEADED. THE
RED DOT FOR FEDERAL FUNDS RATE
IS TO THE LEFT . FED IS TRYING
TO STIMULATE THE ECONOMY.
TRYING TO PREVENT FURTHER
WEAKENING OF THE LABOR MARKET.
AND THAT'S DONE BY LOWERING
THE INTEREST RATE SLIGHTLY
FURTHER THAN IT IS NOT THE
LARGEST HALF DIFFERENCE. WHEN
IT COMES TO FINAL INCOMES TO
CPI INFLATION, THE DIFFERENCES
THERE, THEY ARE SMALLER. THE
LIKELIHOOD OF A RECESSION.
LUCKILY, THOSE FEARS BACK IN
JULY SUBSIDED. AND THEN FURTHER
EMPLOYMENT REPORTS WERE
STRONGER. SO THE OUTLOOK FOR
THE LIKELIHOOD OF RECESSION
RIGHT NOW IS SOMEWHERE AROUND
26% ROUGHLY WHERE IT WAS BACK
IN JULY. SO NO BIG CHANGES IN
TERMS OF THAT. ONE OUT OF FOUR
THE ODDS FOR A RECESSION. SO
YEAH. LABOR MARKET IN THE U.S.
CONTINUES TO BE MODERATING.
LUCKILY THAT WEAK REPORT IN
JULY WAS JUST ONE MONTH. IT WAS
FOLLOWED BY PARTICULARLY STRONG
SEPTEMBER. JOB GAINS AND THE
REVISION OF THOSE INITIAL
ESTIMATES FOR JULY. SO THAT
ESSENTIALLY MOTIVATED GLOBAL TO
REVISE THEIR FORECAST FOR
EMPLOYMENT GROWTH UP. RIGHT W,'
UP FOR 0.6%. PESSIMISTIC
SCENARIO, AGAIN, THAT'S THE
RECESSION. OCCUR RING.
RELATIVELY SHALLOW RECESSION.
COMPARED TO 2001. NOT 2020 AND
2008. SO RELATIVELY SHALLOW
RECESSION. BUT IT WOULD IMPLY
THERE ARE JOB LOSSES, BEYOND
WHERE IT WOULD GO IN THE
BASELINE SCENARIO. NOW, HOLDING
ONTO THE REGIONAL FORECAST,
THERE ARE SOME ADDITIONAL
THINGS WE ARE INCORPORATING
WHEN DEVELOPING THE FORECAST.
WE USE THE NATIONAL FORECAST.
AND WE USE THE INFORMATION ON
THE LOCAL AND REGIONAL ECONOMY.
ONE OF THE VERY IMPORTANT
SOURCES OF INFORMATION HERE ARE
THE EMPLOYMENT ESTIMATES COMING
FROM WASHINGTON STATE
EMPLOYMENT SECURITY DEPARTMENT.
WE HAVE PRESENTED BACK IN JULY
THE RESULT OF REVISION THAT THE
ESD PERFORMED AS A PART OF
THEIR QUARTERLY BENCHMARK AND
WHAT IS CALLED QUARTERLY
BENCHMARKING PROCESS. IT MOVED
EMPLOYMENT ESTIMATES FOR
SEATTLE METROPOLITAN DIVISION
AREA DOWN. SO THAT IS THE
SECOND LINE THAT SHOWED UP ON
THE CHART. THE REVISION THAT
CAME AFTERWARDS, THE MOST
RECENT REVISION INCREASES THE
EMPLOYMENT ESTIMATES UP. SO ON
AVERAGE EMPLOYMENT IS NOW
GROWING BY THE MOST RECENT
ESTIMATE. 0.7% YEAR OVER YEAR.
THAT BY ITSELF WOULD BE
CERTAINLY GOOD NEWS AND WOULD
MOTIVATE A TRADITION IN THE
REVENUE FORECAST. HOPEFULLY IT
MEANS MORE MOMENTUM GOING
FORWARD. HIGHER REVENUE,
GENERATED BY DIFFERENT TAXES.
UNFORTUNATELY, THERE HAS BEEN,
WHEN WE ARE LOOKING MORE
CLOSELY AT THE EMPLOYMENT DATA,
THE UNDERLYING CHANGES BY
INDUSTRY ARE MORE CONCERNING.
AS A PART OF THE REVISION, THE
RECENT REVISION, ESD DECREASED
THEIR ESTIMATES FOR EMPLOYMENT
IN TRADE, INFORMATION,
FINANCIAL ACTIVITIES,
PROFESSIONAL AND BUSINESS
SERVICES SECTOR. OVERALL, AS
THESE CHARTS SHOW, THE
EMPLOYMENT IN THESE EXTRAS HAS
BEEN DECLINING SINCE SUMMER OF
2022. IT HAS BEEN, IT HAS
DECLINED SO FAR BY 30,000 JOBS
WHICH IS 3.8%. OF THAT PEAK.
NOW THE REASON WE ARE FOCUSING
ON THESE PARTICULAR SECTORS,
THE OUTSIDE IMPORTANCE FOR
BUSINESS AND OCCUPATION SALES
TAX AND FEDERAL EXPENSE TAX.
THEY OVERALL ACCOUNT FOR 43% OF
THE REGIONAL EMPLOYMENT. THAT
WOULD BE THE EMPLOYMENT FOR
KING AND SNOHOMISH COUNTIES
BECAUSE THAT IS THE KIND OF
INFORMATION THAT IS AVAILABLE
ON MONTHLY BASIS. WE DON'T
HAVE MONTHLY DATA FOR SEATTLE.
WHAT WE DO HAVE FOR SEATTLE IS
A TAX COLLECTION AND AGAIN, IF
WE ARE LOOKING AT THE
BUSINESSES THAT OPERATE IN
THESE INDUSTRIES, THEY
FOR EXPENSE TAX AND PAYROLL
TAX. THE FACT THE REGIONAL
EMPLOYMENT IS DECLINING AND HAS
BEEN REVISED DOWN IS NOT THE
GOOD NEWS FOR REVENUE
COLLECTION. AS A FINAL POINT OF
WHERE EXACTLY THE REGIONAL
LABOR MARKET CURRENTLY IS,
LOOKING AT IT COMPARING IT TO
THE DEVELOPMENT OF THE REST OF
THE WASHINGTON STATE, WEAKER
EMPLOYMENT GROWTH IN 2020 IN
THE REGIONAL LABOR MARKET. KING
AND SNOHOMISH COUNTIES HAVE NOT
BEEN GROWING AS FAST AS
WASHINGTON STATE. CUMULATIVELY
SINCE 2020, WASHINGTON STATE
HAS ADDED 4% JOBS OVER THE SAME
PERIOD, METROPOLITAN DIVISION
AND SNOHOMISH COUNTIES HAVE
ONLY GONE UP BY 0.5%. NOW,
METROPOLITAN DIVISION IS A PART
OF WASHINGTON STATE. IT IS
ABOUT HALF. SO IF THAT HAPPEN
HAS NOT GROWN AT ALL, THAT
MEANS THAT TO GET TO THE 4%
GROSS FOR WASHINGTON STATE AS A
WHOLE, THE AREA OUTSIDE OF
SEATTLE METRO, PART OF THE
WASHINGTON STATE THAT EXCLUDES
THE METROPOLITAN DIVISION HAS
GROWN ABOUT 8%. CUMULATIVELY
OVER THE COURSE OF FOUR YEAR,
THAT OVERALL MEANS THAT THE
SHARE OF THE EMPLOYMENT THAT IS
WITHIN SEATTLE METRO AREA HAS
GONE DOWN 51% OVER THE OVERALL
STATE EMPLOYMENT TO 49.
SLIGHTLY ABOVE 49% OF THE TOTAL
STATE'S EMPLOYMENT. IN THE TEN
YEARS BEFORE. SHOWN IN BETWEEN
2010 AND 2020 WHERE THE SHARE
OF THE REGIONAL STATE. SO TO
SUMMARIZE THE EMPLOYMENT
OUTLOOK FOR U.S., THERE HAS
BEEN A SLIGHT UPWARD REVISION
FOR THE EMPLOYMENT REPRESENTED
BY THE UPWARD SHIFTING BLUE
LINES FROM JULY TO OCTOBER.
WHEN WE LOOK AT WHAT THE
REVISIONS IMPLY, TOGETHER WITH
SOME ADDITIONAL BAD NEWS, THE
STRIKE WILL CERTAIN WILL HAVE
AN IMPACT ON THE LABOR MARKET.
SO BUILDING ALL OF THAT IMPLIES
SLOWER GROWTH THAN WE WERE
PREVIOUSLY PREDICTING FOR 2025.
THE PART OF THE LINE THAT HAS
GONE UP TO RED LINES, COMPARE
THE JULY FORECAST THAT WE
PRESENTED HERE IN AUGUST. AND
THE CURRENT FORECAST. THERE HAS
BEEN AN UPWARD REVISION FOR
TOTAL EMPLOYMENT. NOT NECESSARY
FOR ALL THE RELEVANT INDUSTRIES
OR THE MOST IMPORTANT
INDUSTRIES. BUT THERE HAS BEEN
AN UPWARD TRADITION FOR
EMPLOYMENT GROWTH. THE FACT
THAT THOSE IMPORTANT INDUSTRIES
HAVE BEEN REVISED DOWN. THE
FACT THAT THERE HAVE BEEN
LAYOFFS ANNOUNCED AT BOEING
MEAN THAT FOR THE REST OF 2024
AND 2025 WE ARE PREDICTING 0.7%
GROSS YEAR OVER YEAR ON
AVERAGE. THROUGHOUT UNTIL 2026.
AND THAT'S THE BASELINE
SCENARIO. AGAIN, S&P GLOBAL
PRODUCES THREE MAIN SCENARIOS.
THE BASELINE IS A SIGN 55%
PROBABILITY. THE PESSIMISTIC IS
25%. PROBABILITY. AND THEN, THE
OPTIMISTIC WHICH IS NOT SHOWN
HERE IS A SIGN OF 20%.
PROBABILITY. JUST LIKE FOR THE
NATION, THE PESSIMISTIC
SCENARIO WOULD LEAD TO JOB
LOSSES WHICH WOULD BE NOTABLE.
TO BE ABOUT 4.3% FEWER JOBS IN
THE SEATTLE AREA. BY SUMMER OF
2026. COMPARED TO WHERE WE ARE
NOW. THAT'S A RECESSION THAT
IS MILDER. SLIGHTLY MILDER.
THAN THE 2001 RECESSION OR THE
2020 RECESSION. THE RECOVERY
WOULD TAKE UNTIL 2029. AGAIN,
SLIGHTLY SHORTER THAN WHAT WE
HAVE SEEN FOR THE 2001
RECESSION. IN GENERAL. FEEL
VERY SIMILAR. UNLESS THERE ARE
ANY QUESTIONS, WE CAN MOVE ONTO
THE REVENUE FORECAST.
>> DIRECTOR DURAS, WHEN WAS THE
LAST TIME WE SAW DOWNWARD
REVISIONS LIKE THIS?
>> THERE ARE CERTAINLY SOME
THAT ARE UNPRECEDENTED AND WE
WILL TALK ABOUT THE SALES TAX.
IN TERMS OF THE OVERALL
MAGNITUDE, THERE HAVE BEEN SOME
YEARS WHERE A SIMILAR MAGNITUDE
HAVE OCCURRED. AND WHEN WE ARE
PRESENTING THE GENERAL FUND
REVENUE FORECAST THAT MIGHT BE
MORE HELPFUL. THOSE REVISIONS
FOR EMPLOYMENT IF YOU ARE
LOOKING AT EMPLOYMENT. THEY DO
OCCUR EVERY QUARTER. SOMETIMES
THEY ARE SMALLER, SHORTER,
SOMETIMES THE NUMBERS GO DOWN.
THE UNFORTUNATE NEWS HERE IS
RECENTLY THEY HAVE JUST BEEN
GOING DOWN. IN THE CASE WHERE
THEY HAVE GONE UP, IT'S NOT
THE KIND OF INDUSTRY THAT WE
WANT TO BE REVISED OF.
>> THANK YOU. AND I SEE THE
COUNCIL PRESIDENT HAS HER HAND
UP. I HAVE A FEW MORE QUESTIONS
AND I WILL PASS IT OVER TO YOU.
IT IS MY UNDERSTANDING THAT ONE
OF THE FIRST STEPS YOU TAKE IS
LOOKING AT THE REGIONAL
ECONOMIC SITUATION. AND THAT
REGION INCLUDES PIERCE, KING,
AND SNOHOMISH COUNTY. THE
REGIONAL IS THE METROPOLITAN
DIVISION. AND THE FORECAST FOR
THOSE TWO COUNTIES IS WHAT IS
USED TO INFORM THE REVENUE
FORECAST. THERE IS OCCASIONALLY
TRACKING AND MONITOR
DEVELOPMENT IN THE REST OF THE
WASHINGTON STATE. BUT WE DON'T
BELIEVE THAT IT HAS A
PARTICULAR RELEVANCE.
>> THAT'S FAIR. I CONDITIONED
HELP BUT NOTICE IN SNOHOMISH
COUNTY THE SECOND LARGEST
EMPLOYER IS THE TULALIP TRIBES
THAT CONTINUE TO BE A
SUCCESSFUL LARGE BUSINESS. THE
FIRST, THOUGH, BEING BOEING. I
CAN'T HELP BUT NOTICE THAT
SOME OF THE ISSUES THAT HAVE
ARISEN HAVE OCCURRED IN WHAT I
MEAN IS THERE WAS A STRIKE
SUPPORTING THE UNION AND THEIR
RIGHT TO STRIKE SUPPORTING YOU
KNOW, AND ALL OF THAT NOT
SAYING ANYTHING HERE ABOUT
THAT. STANDING WITH THE
WORKERS. BUT DID THAT PLAY A
ROLE IN THE CURRENT SITUATION?
IT DOES FOR THE EMPLOYMENT
GROWTH FORECAST SHOWN HERE IN
THE CHART. THE RED LINE HAS
MOVED DOWN TO INCORPORATE THE
STRIKE THAT IS STILL ONGOING.
WHICH IS BRINGING DOWN THE
FORECAST FOR THE EMPLOYMENT
GROWTH. AND THOSE ANNOUNCED
LAYOFFS ARE STILL UNCLEAR HOW
MUCH THEY WILL AFFECT THE
REGIONAL EMPLOYMENT. SOME OF
THAT WILL BE TAKING PLACE
ELSEWHERE. BUT WE HAVE TRIED TO
ESTIMATE THE IMPACT OF THOSE
PLAYOFFS AND THE IMPACT ON THE
REGIONAL EMPLOYMENT IN THE
AEROSPACE SECTOR. SO IT IS A
PART OF WHAT IS DRIVING DOWN
THE EMPLOYMENT GROWTH.
>> THERE HAS BEEN FURLOUGH
COMPARED TO THE BLUE COLLAR
STRIKE OCCURRING. JAN, SHOULD
BOEING PROVIDE A CONTRACT TO
IM751 TO VOTE THEY FIND
SUFFICIENT AND RESOLVE THIS
STRIKE? WOULD THAT HAVE AN
IMPACT ON THE REVENUE FORECAST?
WHEN IS THE NEXT TIME WE GET
THAT UPDATE? I KNOW THAT'S
HAPPENING THIS WEDNESDAY.
WHAT'S OUR TIME LINE AS FAR AS
THE FORECAST GOES?
>> SO WHEN IT COMES TO THE
DIRECT IMPACT OF REVENUES, IT
IS NOT AS LARGE AS WOULD BE THE
IMPACT OF SOME OTHER EMPLOYERS
IN THE CITY. A LOT OF THAT
ECONOMIC ACTIVITY IS NOT REALLY
TAKING PLACE IN THE CITY AND
DOES NOT DIRECTLY AFFECT OR
DOES NOT AFFECT TO A LARGE
EXTENT THE REVENUES. WOULD NOT
BE AGAIN SIGNIFICANTLY DIRECTLY
IMPACTED. BY THESE LAYOFFS,
SALES TAX IS DESTINATION BASED.
PEARL EXTENSE TAX, PAYROLL
EXPENSE TAX IS A DIFFERENT
STORY. DEPENDS WHERE EXACTLY.
IF IT IS THESE WHITE COLLAR
WORKERS. AND IF THEY HAPPEN TO
BE EMPLOYED IN SEATTLE AND IF
BOEING HAPPEN TO BE ONE OF THE
COMPANIES THAT IS PASSING ALL
THE THRESHOLDS. AGAIN, 10%
LAYOFFS THAT HAVE BEEN
ANNOUNCED IN BOEING WILL NOT
HAVE PARTICULARLY BIG DIRECT
IMPACTS. THE INDIRECT EFFECTS
THAT WOULD MATTER. LOWER
OVERALL EMPLOYMENT MEANS LOWER
WAGES AND SALARIES, INCOMES.
LESS SPENDING. OVERALL CONSUMER
SENTIMENT COMING DOWN. AND
EVERYTHING DRAGGING THE REVENUE
COLLECTION. BUT AGAIN, THERE
ARE THINGS THAT WOULD BE MORE
WORRISOME. IF THIS WAS 10,000
JOBS.
>> WELL SAID. NOTING THE IMPACT
IT HAS ON OUR REVENUES RECEIVED
WHICH WE RECEIVED LAST QUARTER.
AND LAST FRIDAY. THE REVENUES
RECEIVED ARE NOT GOING TO BE AS
IMPACTED AS BECAUSE WE ARE
GETTING SECONDARY FUNDS FROM
THE SECONDARY ECONOMIC IMPACTS
FROM THE SALARIES.
>> THAT'S CORRECT. YEAH.
>> WITH THAT, I WILL PASS IT TO
COUNCIL PRESIDENT NELSON AND
THEN I WILL CHECK IN WITH
DIRECTOR CARNELL AND VICE CHAIR
RAKA TO SEE IF NOT I WILL
SEND IT TO COUNCILMEMBER SAKA.
>> THANK YOU. COULD YOU GO TO
PAGE 12? I AM LOOKING AT THE
FIRST TIME THE PLACE WHERE THE
JULY AND OCTOBER FORECAST
DIVERGE. SO THAT IS IN LOOKS
LIKE JULY BASICALLY. I AM
ASSUMING THAT THE ASSUMPTION
THE REASON FOR THAT DIVERGENCE
IS WHAT WE HAVE ALREADY BEEN
TALKING ABOUT. IS THE STRIKE.
IS THAT SAFE TO SAY OR DO OTHER
ASSUMPTIONS LEAD TO THAT
DIVERGENCE WE HAVE NOT TOUCHED
ON? OR OTHER FACTORS?
>> THE FACT, THE FIRST PART OF
THESE TWO LINES THE DARKER RED
LINE IS ABOVE THE ONE SHOWING
THE JULY. THAT'S THE IMPACT OF
THE UPWARD REVISION IN THE
EMPLOYMENT ESTIMATES BY ESD.
ESSENTIALLY THEY WENT BOOK,
LOOKED AT THE EMPLOYMENT DATA.
YOU CAN SEE IT IS GOING BACK
ALL THE WAY TO 2023 AND IT
BECOMES LARGER OVER 2024 SO
OCCASIONALLY, THERE HAS BEEN
THE LARGER REVISIONS OF THING
THAT'S HAVE ALREADY HAPPENED.
JUST BETTER ESTIMATES FOR
EMPLOYMENT DATA SO IT IS NOT
ABOUT THE OUTLOOK CHANGING BUT
OUR UNDERSTANDING OF THE
CURRENT EMPLOYMENT IN THE
REGIONAL MARKET. THAT'S WHAT'S
HAPPENING HERE.
>> OKAY, BECAUSE IN JULY IT
LOOKS LIKE YOU WERE, THE
REGIONAL EMPLOYMENT FORECAST
WAS ON A POSITIVE TREND, BUT
THE RED LINE SHOWS THAT IT WAS
ACTUALLY GOING DOWN. THAT'S
WHAT I'M LOOKING AT.
>> CAN YOU REPEAT THAT?
>> YEAH, WHEN YOU LOOK AT WHERE
THE THREE LINES JOIN, IT LOOKS
LIKE IN THE MIDDLE OF 2004.
RIGHT? AND THEN THE PINK LINE
GOES UP. BUT THE RED LINE GOES
DOWN. AND SO I'M JUST
WONDERING IF SO CLEARLY THERE
WAS AN UNEXPECTED TURN OF
EVENTS OR ASSUMPTIONS.
>> SO WE ARE NOW TALKING ABOUT
STARTING FROM MIDDLE OF 2024.
AND GOING FORWARD.
>> RIGHT.
>> AND THE FACT THAT THE PINK
LINE IS ABOVE THE RED LINE. GOT
IT.
>> YES.
>> SORRY ABOUT THAT. YEAH. SO
THAT IS NOT A HISTORICAL
REVISION, THAT'S THE BOEING
STRIKE, THE LAYOFFS, THE
OVERALL LOWER EMPLOYMENT GROWTH
IMPLIED BY THE COMPOSITION OF
THE EMPLOYMENT BY INDUSTRY. THE
FACT THAT THOSE IMPORTANT
INDUSTRIES, PROFESSIONAL AND
BUSINESS SERVICES, INFORMATION
SECTOR, TRADE AND INFORMATION
SECTOR, THEY HAVE REVISED THE
DATA FOR EMPLOYMENT GROWTH
THERE. LOOKING AT THE LAST
LINE, THE ONE THAT KEEPS COMING
DOWN, IT IS ESSENTIALLY SAYING
THAT WHILE THESE SECTORS HAVE
NOT STABILIZED YET. THEY ARE
STILL IN A DECLINE. THERE IS
LESS MOMENTUM GOING FORWARD.
LESS EMPLOYMENT GROWTH TO BE AN
ANTICIPATED.
>> OKAY. THANK YOU, SO THE JULY
FORECAST WAS MORE OPTIMISTIC.
>> THE JULY FORECAST WAS MORE
OPTIMISTIC REGARDING THE
EMPLOYMENT OUTLOOK FOR 25. YES.
>> THANK YOU. AND ON PAGE 10,
4% EMPLOYMENT GROWTH IN THE
WASHINGTON STATE VERSUS .5 IN
SEATTLE METROPOLITAN DIVISION
BECAUSE OUR ECONOMY IS SO
DOMINATED BY THE INDUSTRIES
THAT ARE MORE VOLATILE OR NOT
DOING SO WELL. CORRECT? WHEN
WAS THE LAST TIME THERE WAS
ALIGNMENT WITHIN ABOUT 2%? SO
YEAH, THE FACT THE GROWTH IN
SEATTLE METROPOLITAN DIVISION
IS SO WEAK THAT HALF A PERCENT
HAS A LOT TO DO WITH THE OTHER
CHART. WHICH SHOWS THE
DECLINING EMPLOYMENT IN THE
SECTORS WHICH ARE 4% OF THE
OVERALL EMPLOYMENT. THAT IS
HAPPENING IN THE SEATTLE
REGION. NOT REALLY OUTSIDE.
>> THAT'S ALL MY QUESTIONS.
>> THANK YOU. DIRECTOR, VICE
CHAIR RAKA? DO YOU HAVE
QUESTIONS AT THIS TIME?
>> NOPE. I HAVE NO QUESTIONS.
IT HAS BEEN A VERY CLEAR AND
CONCISE PRESENTATION.
>> THANK YOU.
>> NO QUESTIONS FROM ME. JUST
REITERATING THE SEATTLE
METROPOLITAN CONTINUED SLOW
GROWTH IS CONCERNING.
>> OVER TO YOU COUNCILMEMBER
SAKA, THEN KETTLE AND RIVERA.
>> THANK YOU MR. CHAIR. THANK
YOU FOR THIS INITIAL BRIEFING.
LOOK FORWARD TO LEARNING MORE
LATER. I DO HAVE SOME INITIAL
QUESTIONS AT A HIGH LEVEL OF
HOW THIS ALL TIES TOGETHER.
MAYBE SOME OF THOSE WILL GET
ADDRESSED ALONG THE WAY. AS
PART OF THIS JOURNEY. I HAVE
SOME FOUNDATIONAL QUESTIONS TO
ASK AND LEVEL SETTING HOW ALL
OF THIS TIES TOGETHER WITH
RESPECT TO THE REVENUE FORECAST
COUNCIL WOULD LOVE TO BETTER
UNDERSTAND THE ROLES AND
RESPONSIBILITIES OF THE REVENUE
FORECAST COUNCIL. WE GLOSSED
OVER IT A LITTLE BIT TODAY. SO
THE ROLES AND RESPONSIBILITIES
OF THE COUNCIL. IT IS DECISION
MAKING AUTHORITY. WHO PROVIDES
THE BASELINE SUBJECT MATTER
EXPERTISE? DO THEY REPORT UP TO
THE EXECUTIVE OR REPORT UP TO
US OR A MIXTURE OF BOTH? AND
ALSO, THE COMPOSITION OF THE
REVENUE FORECAST COUNCIL. I
UNDERSTAND THAT COUNCIL
PRESIDENT AND OUR BUDGET CHAIR
REPRESENT THAT. WHAT IS THE
REST OF THE COMPOSITION? AND
THEN THE OTHER QUESTIONS. THANK
YOU.
>> THANK YOU. I WILL TURN IT TO
DIRECTOR NOBLE. HE WENT TO BE
THE INDEPENDENT FORECAST
COUNCIL DIRECTOR AND IS CENTRAL
STAFF. I WILL ASK FOR YOU TO
KEEP IT THE SUMMARY SHORT.
>> SO, SEVERAL YEARS 2020
OR 2021, CITY COUNCIL CREATED
THE FORECAST COUNCIL. FOR KING
COUNTY AND STATE OFFICES
SIMILARLY TITLED. SO IN BOTH
KING COUNTY AND THE STATE,
THERE IS A SEPARATE FUNCTION
THAT FORECAST REVENUES, HAVING
BEEN MODELED ON THOSE
SIGNIFICANTLY, THE SEATTLE
OFFICE THAT JAN DIRECTS REPORTS
TO A FOUR-MEMBER BOARD. THIS
WAS ALL SET OUT IN SMC. A FOUR
MEMBER BOARD THAT INCLUDES TWO
REPRESENTATIVES FROM THE
EXECUTIVE SIDE AND TWO FROM THE
COUNCIL. THE COUNCIL SIDE IT IS
THE COUNCIL PRESIDENT AND THE
FINANCE CHAIR IF YOU WILL. THE
BUDGET DIRECTOR. THE CHAIR OF
THE BUDGET COMMITTEE. IT IS THE
MAYOR OR HIS OR HER DESIGNEE.
SO, JAN'S DIVISION WHICH I
HELD A UP THE OF YEARS MYSELF
REPORTS TO THAT BOARD AND THOSE
FOUR INDIVIDUALS. THE EXPERTISE
IS WITHIN THAT OFFICE, JAN CAN
SAY MORE. SUBSCRIBE TO A
NATIONAL FORECAST SERVICE THAT
PROVIDES THE NATIONAL FORECAST.
THERE IS A REGIONAL MODEL THEY
INHERITED. WE MADE OUR OWN. JAN
IN PARTICULAR HAS MADE HIS OWN.
SO THAT'S THE GENOCIDE OF IT.
IT WAS A VERY PURPOSEFUL
DECISION SO FOXES IN HEN HOUSES
COME TO MIND. THE FOLKS RUNNING
THE BUDGET OFFICE WHO WERE
ENGAGED IN THE ENTERPRISE OF
TRYING TO BALANCE THE BUDGET
MIGHT HAVE A CONFLICT OF
INTEREST OR FACE POLITICAL
PRESSURE FROM THE EXECUTIVE OR
THE LEGISLATIVE BRANCHES IN
TERMS OF THE FORECAST ITSELF.
AND THE GOAL WAS TO, AND THIS
IS VERY EXPLICIT. GOES TO
SEPARATE THEM FROM THOSE KINDS
OF POLITICAL PRESSURES AND TO
DELIVER A FORECAST WITHOUT
INFLUENCE.
>> SO THE BASELINE INFORMATION,
THE SUBJECT MATTER EXPERTISE
FED UP TO THIS COUNCIL IS
PROVIDED BY THE MAYOR'S
OFFICE?
>> NO. THE FORECAST OFFICE
ITSELF. SO JAN DURAS, I WENT TO
WHEN I WAS THERE. EXPERTISE IS
IN THE OFFICE.
>> WHO DOES THE OFFICE REPORT
TO?
>> COUNCILMEMBER SAKA. I HAVE
ANSWERED IF QUESTION TWICE
ALREADY. I WILL ASK FOR IF YOU
HAVE QUESTIONS ON THE FORECAST
THAT WE JUST GONE THROUGH,
HAPPY TO TAKE THOSE QUESTIONS
BUT I WANT TO KEEP US TICKING
ALONG BECAUSE WE HAVE NOT EVEN
GOTTEN TO THE MEAT OF THE
SUBJECT YET.
>> THIS IS IMPORTANT IN TERMS
OF UNDERSTANDING THE BROADER
CONTEXT SO MR. CHAIR I THINK IT
IS IMPORTANT TO UNDERSTAND
THIS.
>> THE EXPERTISE IS IN THE
FORECAST OFFICE.
>> YEAH. WHO DOES THE OFFICE
REPORT TO?
>> TO THE FOUR MEMBERS OF THE
FORECAST COUNCIL. TWO FROM THE
EXECUTIVE.
>> AND THEIR DECISION MAKING
AUTHORITY?
>> THE WAY THE ORDINANCE YOU
WILL SEE THIS PLAY OUT ONE WAY
OR THE OTHER. THE DIRECTOR OF
THE FORECAST OFFICE WILL
PRESENT A RECOMMENDED FORECAST.
AND YOU WILL SEE THAT TODAY.
UNLESS THE FORECAST COUNCIL
VOTES TO OVERRIDE THAT
FORECAST, THAT IS THE OFFICIAL
CITY FORECAST. AND TO OVERRIDE
REQUIRES THREE OF THE FOUR
MEMBERS VERY PURPOSELY
STRUCTURED SO IT REQUIRES SOME
CONSENSUS BETWEEN THE EXECUTIVE
AND LEGISLATIVE BRANCHES. YOU
NEED A VOTE FROM ONE SIDE OR
THE OTHER TO OVERRIDE THAT
FORECAST. SO THAT'S THE SETUP.
YOU'LL HEAR A LITTLE BIT TODAY
FROM THE EXECUTIVE STAFF. THERE
IS A NARROW SET OF REVENUES
DERIVED FROM DEPARTMENT
OPERATIONS WHERE THE EXECUTIVE
IS WELL POSITIONED TO DEVELOP
THOSE FORECASTS. BECAUSE THEY
ARE WORKING CLOSELY WITH THE
OFFICES THEMSELVES ON THE
THINGS LIKE DEPLOYMENT OF
PARKING METER AS AN EXAMPLE.
BUT THE LARGER ECONOMIC DRIVEN
REVENUES THAT ACCOUNT FOR THE
90% OF THE GENERAL REVENUE ALL
COME FROM THE FORECAST OFFICE.
>> THANK YOU. ULTIMATELY WHAT I
WAS TRYING TO DRILL DOWN INTO
IS THIS WHOLE CONSTRUCT OF
INDEPENDENCE. I WOULD SUBMIT
THAT IT IS NOT TRULY
INDEPENDENT. WE HAVE GOOD
REPRESENTATION. AND THIS IS I
THINK THE BEST SYSTEM BASED ON
EVERYTHING I KNOW. BUT IT IS
NOT TRUE INDEPENDENCE. BUT IN
ANY EVENT, THANK YOU.
>> COUNCILMEMBER KETTLE?
>> THANK YOU CHAIR STRAUSS.
IT'S INTERESTING TO LISTEN TO
THE BRIEFING AS AN ADULT HERE
IN SEATTLE. IT IS KIND OF SAD
NEWS BUT AS A BOW WHO
IN BELT
THE GREAT LAKES, IT'S NOT BAD.
SO IT IS SOMEWHAT OF YOUR
PERSPECTIVE, OBVIOUSLY SITTING
HERE WE NEED TO DO BETTER. I
FIND, CAN I, I MAY HAVE
MISHEARD YOU. I THINK CHAIR
STRAUSS ASKED A QUESTION. METRO
SEATTLE, THERE ARE DIFFERENT
DEFINITIONS LIKE JUST KING
COUNTY. THE THREE COUNTIES AND
SOME INCLUDE THE METRO AREAS
LIKE SKAGIT COUNTY. I HEARD YOU
SAY SNOHOMISH. IS IT JUST KING
AND SNOHOMISH?
>> YEAH. SO THERE IS
METROPOLITAN DIVISION. AND THEN
THERE IS METRO STRAYTIST COOL
AREA. IN OUR WORK WE ARE ALMOST
ALWAYS LOOKING AT KING AND
SNOHOMISH COUNTIES. THERE IS
SOME DATA COMING ONLY FOR THE
TRICOUNTY AND WOULD INCLUDE
PIERCE COUNTY. CPI FOR A PRICE
INDEX FOR THE THREE COUNTIES
RATHER THAN JUST TWO. MOST OF
THE TIME WHEN I SAY METRO IT
WOULD INCLUDE KING AND
SNOHOMISH BUT NOT PIERCE.
>> THANK YOU FOR THAT
CLARIFICATION. I APPRECIATE THE
POINT REGARDING THE IMPACT OF
BOEING KNOCK ON WOOD THAT GOES
WELL. THAT IS A MAJOR INDUSTRY
IN OUR AREA. PARTICULARLY IF IT
IS COMING OHM. ANALYTIC
ENGINEERING FIRM AGAIN. THAT
WOULD BE FANTASTIC FOR THE
REGION. BUT FOR US, I THINK
ABOUT AMAZON, AND AMAZON HAS
GONE THREE DAYS A WEEK. THE
EXECUTIVES GO INTO THREE. MANY
NOVEMBER BASICALLY. AND I SEE
THOSE KINDS OF FACTORS AND
OTHER FACTORS AT PLAY IN TERMS
OF SEATTLE SPECIFIC. AS IT
RELATE TO THE TAXES. IT'S
INTERESTING, IF YOU LOOK AT THE
LEGAL PROFESSION, THEY HAVE
DOWNSIZED DOWNTOWN IN THE CITY.
PART OF IT IS THE PANDEMIC.
PART OF IT IS THE
ATTRACTIVENESS OF DOWNTOWN.
ACROSS MANY FRONTS. AS MY
COLLEAGUES KNOW, I TURN EVERY
MEETING INTO A PUBLIC SAFETY
MEETING. I WAS CURIOUS. ARE YOU
LOBING SEWLY AT THE NUMBERS OR
THE UNDERLYING FACTORS THAT
PLAY INTO IT? BAY THE WAY,
IT'S NOT JUST PUBLIC SAFETY.
AND TIES TO THAT, TOO, IS THE
OPTIMISM AND THE MOMENTUM. LIKE
THE WORLD CUP. SO WHEN I SEE
THESE NUMBERS, I'M HEARING A
LOT OF THINGS GOING THE OTHER
WAY, BUT THE NUMBERS SEEM TO BE
POINTING THE OPPOSITE WAY. I
WONDER IF YOU CAN ADDRESS THAT
CONFLICT.
>> COMMISSION TO THE EMPLOYMENT
DATA, RETURN TO THE OFFICE IS
IMPORTANT FACTOR FOR BUSINESS
AND OCCUPATION TAX. THOSE
ECONOMIC FORECASTS ARE JUST ONE
PART OF THE INPUT. THEN WE HAVE
ADDITIONAL DATA INPUTS BUILDING
THE REVENUE FORECAST. AND WE DO
TAKE INTO ACCOUNT THE RETURN TO
THE OFFICE. IT IS CERTAINLY
GOOD NEWS FOR PAYROLL EXPENSE
TAX WHEN THERE IS AN INCREASED
RETURN TO THE OFFICE. BECAUSE
THE TAX BASE GETS LARGER. IN
THE SAME VAIN, OFFICE VACANCY
RATES ARE A FACTOR WE ARE
TAKING INTO ACCOUNT. RELATED TO
THAT. IF THE RETURN TO THE
OFFICE WERE TO STALL, THE FIRMS
WOULD SHED OFFICE SPACE. THE
VACANCY RATE WOULD DEPRESS. IT
WOULD LEAD TO LOWER RATE FOR
EXAMPLE. IN ADDITION TO THE
IMPACT ON PAYROLL EXPENSE TAX.
>> THANK YOU COUNCILMEMBER
KETTLE. COUNCILMEMBER RIVERA?
>> THANK YOU CHAIR AND JAN. I
WAS GOING TO ASK, BY
COUNCILMEMBER KETTLE ASKED
ABOUT HOW RETURN TO WORK HAS
IMPACTED THIS SO THANK YOU FOR
ANSWERING THAT QUESTION. AND I
WILL JUST MAKE AN OBSERVATION
ON SLIDE 12. 25% OF THE
PESSIMISTIC SCENARIO WHICH
LOOKS A LOT WORSE THAN THE
OPTIMISTIC ONE FOR 2025. 5%
SEEMS LIKE A LOT IN DIFFERENCE
BETWEEN THOSE TWO SCENARIO, BUT
CAN YOU CONFIRM FOR ME THAT'S
THE CASE?
>> YEAH. SO, THERE ARE TWO
THINGS THAT DETERMINE HOW THE
RISKS ARE BALANCED. THE FIRST
OF IT IS HOW MUCH OF A
PROBABILITY THERE IS TO THE
UPSIDE. AND HOW MUCH IS TO THE
DOWNSIDE. AND THEN THE SECOND
THING WOULD BE HOW GOOD IS THE
UPSIDE RELATIVE TO THE BASELINE
AND HOW BAD THE DOWNSIDE IS
RELATIVE TO THE BASELINE, RIGHT
NOW, THE RISK IN GENERAL, THE
DOWNSIDE IS A RECESSION, THE
25% THING THAT WAS MENTIONED AT
THE BEGINNING FOR OVERALL
LIKELIHOOD OF A RECESSION
WITHIN THE 12 MONTHS FROM NOW.
THE SCENARIOS USUALLY ASSIGN
THE HIGHEST PROBABILITY MORE
THAN 50% TO THE BASELINE. THAT
IS WHY IT IS A BASELINE. HAS TO
HAVE MORE THAN 0%.
>> ALL RIGHT. I WOULD RATHER IT
BE IN THE OPTIMISTIC SCENARIO.
BUT NEVERTHELESS, THAT'S WHERE
WE ARE AT. AND IT IS HELPFUL TO
KNOW HOW THESE THINGS ARE
CALCULATED. AND THANKS FOR
ANSWERING ON THE RETURN TO
WORK. WE HAVE TO GET FOLKS BACK
IN THE OFFICE. IT'S HAVING A
HUGE IMPACT ON OUR ECONOMY. AND
WE SEE IT HERE TODAY AS YOU ARE
DESCRIBING. SO THANK YOU CHAIR.
>> THANK YOU COUNCILMEMBER
RIVERA. WHO IS VICE CHAIR OF
THE SELECT BUDGET COMMITTEE BUT
WE ARE NO THE FORECAST COUNCIL.
WITH THAT, I SEA NO OTHER HANDS
REGARDING THE ECONOMIC OUTLOOK
FOR U.S. AND SEATTLE AREA.
LET'S DIVE INTO THE BAD NEWS.
>> ONE MORE SLIDE. AND THEN,
YEAH. ONE MORE SLIDE AND WE
WILL GET TO THE BAD NEWS. SO
JUST A QUICK REMINDER WHERE WE
ARE. AND THE NEW INFORMATION WE
HAD WHEN DEVELOPING THIS
FORECAST. THE CHART ON THE
RIGHT SHOWS HOW THE REVENUE IS
COMING. TYPICALLY COMING IN
THROUGHOUT THE YEAR. HOW MUCH
OF THE PARTICULAR REVENUE
STREAM IS COLLECTED AND WE ARE
AWARE OF AT THE TIME WHEN WE
ARE DEVELOPING THE APRIL,
AUGUST, AND OCTOBER FORECAST.
BY THIS TIME OF YEAR, WE HAVE
ABOUT HALF OF THE GENERAL
REVENUE FUND THE FIRST TWO
QUARTERS. SINCE AUGUST, WE HAVE
RECEIVED THE RETURNS FOR
BUSINESS AND
THE SECT QUADERRER. THIRD IS
COMING IN. WE ARE HAVE RECEIVED
THE DISTRIBUTION SALES TAKE
DISTRIBUTION FOR SEPTEMBER AND
AUGUST. WHEN THE REVENUE IS
COLLECTED. AUGUST AND SEPTEMBER
DISTRIBUTIONS ARE IN GENERAL
ACCOUNTING FOR ECONOMIC
ACTIVITY THAT TOOK MRS. IN JUNE
AND JULY. SO WE HAVE
INFORMATION ON THE ECONOMIC
ACTIVITY THAT TOOK PLACE IN THE
FIRST TWO QUARTERS OF 2024 WITH
THE EXCEPTION OF RATE. THAT
ONE, WE ACTUALLY HAVE ALL THREE
QUARTERS IN ALREADY. AND THAT
IS ALSO THE REASON WHY THE
PURPLE LINE IS HIGHER THAN
EVERYTHING ELSE. THREE QUARTERS
OF REVENUE ARE IN. IN 2023, IT
WAS 80% OF THE REVENUES
COLLECTED.
>> AND JAN, JUST BEFORE
DIRECTOR DURAS,Y APOLOGIES, WE
WILL ASK COLLEAGUES, WE WILL
CAKE QUESTIONS JUST FROM THE
FORECAST COUNCIL MEMBERS UNTIL
THE END OF THIS PRESENTATION,
THEN COME BACK AND OAT UP UP TO
EVERYONE. BUT I BELIEVE UNLESS
THERE ISING THE WE NEED TO ASK,
LET'S HOLD OUR QUESTIONS UNTIL
THE END. WITH THAT, DIRECTOR?
>> ALL RIGHT, SO HERE COMES
THAT BAD NEWS IN PART. THE
FIRST PART IS THE SALES TAX
REVENUE. HOW MUCH THE GROWTH OF
THIS PARTICULAR REVENUE STREAM
HAS GONE DOWN. SO 2022 WAS
QUITE A STRONG YEAR FOR REVENUE
COLLECTION. TOTAL YEAR OF YEAR
GROWTH OF SALES TAX AND THE
BARS SHOW THE CONTRIBUTIONS OF
MAIN SECTORS. TRADE, AND
CONSTRUCTION SECTORS ARE IN
PARTICULARLY THE TWO
SIGNIFICANTLY IMPORTANT
SECTORS. LEISURE AND
HOSPITALITY WOULD BE THE THIRD
ONE. THE REST OF THE INDUSTRIES
AND THAT IS EVERYTHING ELSE PUT
TOGETHER. SO THROUGHOUT 2022,
PRETTY MUCH ALL OF THOSE FOUR
PARTS WE ARE CONTRIBUTING TO
THE OVERALL GROWTH AND AS YOU
CAN SEE, IT HAS BEEN REALLY
STRONG IN EXCESS OF 10% IN
GENERAL THROUGHOUT 2022. THAT
CONTINUED FOR THE FIRST HALF OF
2023. BUT THEN THE SLOWDOWN IN
2023 BROUGHT THE REVENUE
COLLECTION DOWN AND WE STARTED
TO SEE YEAR OVER YEAR DECLINES
IN SALES TAX REVENUE. AND THE
BLACK LINE BELOW ZERO SHOWS IT
HAS DECLINED YEAR OVER YEAR. AS
YOU CAN SEE A LOT OF THAT IS
DUE TO THE CONSTRUCTION SECTOR
AND THE SLOWDOWN IN THE
CONSTRUCTION SECTOR PULLING
DOWN THE REST OF THE SECTOR. SO
IF YOU STACK UP THOSE BARS, YOU
GET TO WHERE THAT BLACK LINE IS
SO THE FACT THAT THOSE YELLOW
BARS START TO BE CONSISTENTLY
BELOW ZERO MEANS CONSTRUCTION
SECTOR IS OFFSETTING THE GAINS.
THAT SORT OF STORY CONTINUES
THROUGHOUT 2024. SO OVERALL
SALES TAX REVENUE IS ON AVERAGE
DECLINING YEAR OVER YEAR
COMPARISON AROUND 2%. THERE HAS
BEEN SLIGHTLY BETTER BETTER.
MONTHS. AS YOU CAN SEE, MOSTLY
CONSTRUCTION SECTOR WITH TRADE
SECTOR WEIGHING DOWN ON THE
OVERALL COLLECTION. WE HAVE
TALKED ABOUT THE SLOWDOWN IN
CONSTRUCTION THE LAST COUPLE OF
MEETINGS HERE. WE WERE
ANTICIPATING THAT TO SOME
EXTENT. IT IS HARDER TO FIGURE
OUT HOW MUCH IT WILL SLOW DOWN.
WE ARE SEEING OVERALL DEMAND
FOR NEW CONSTRUCTION. AS A
RESULT OF INTEREST RATES AND
LARGE AMOUNT OF VACANCIES FOR
OFFICE SPACE. AND THOSE VACANCY
RATES ARE CERTAINLY NOT
MOTIVATING TO BUILD MORE OFFICE
SPACE. THERE HAVE BEEN A LOT OF
MULTIFAMILY UNITS DELIVERED TO
THE MARKET. WITH THE HIGH
INTEREST RATE, NOW IS NOT THE
TIME WHEN DEVELOPERS WOULD RUSH
AND BUILD. THEY ARE TRYING TO
WAIT FOR THE TIME WHEN THE
INTEREST RATING WILL COME DOWN.
SO CONSTRUCTION PERMITS HAVE
DECLINED SIGNIFICANTLY. THAT IS
ONE OF THE INPUTS WE ARE USING
TO GET A SENSE OF WHERE THE
CONSTRUCTION SECTOR IS HEADED.
PERMITS HAVE TO BE ISSUED SO IT
IS LEADING INDICATER FOR WHERE
THE SECTOR IS HEADED.
CONSTRUCTION PERMITS HAVE FOR
THE 12 MONTHS ENDING IN
SEPTEMBER, 2024 DECLINED
RELATIVE TO WHAT WE ARE SEEING
PREPANDEMIC SO RIGHT NOW, FOR
12 MONTHS ENDING SEPTEMBER 20,
2024, THE VALUE OF PERMITS WAS
2.6 BILLION. THAT IS 40% LESS
THAN THE 4.3 BILLION THAT WAS
THE AVERAGE FOR 2016 TO 2019
PERIOD WHERE BEFORE PANDEMIC.
AND BEFORE THE INTEREST RATE
STARTED TO GO UP AND THE
CONSTRUCTION SECTOR STARTED TO
SLOW DOWN. AND SO, CONSTRUCTION
SECTOR IS WEIGHING DOWN
SIGNIFICANTLY ON SALES TAX, IN
ADDITION WITH THOSE REVISION
INS THE EMPLOYMENT DATA. THE
LARGE ECONOMICALLY DRIVEN
REVENUES ARE NOT GROWING AS
FAST, IN SOME CASES THEY ARE
DECLINING. THE FACT THE SALES
TAX IS DECLINING ON THE YEAR
OVER YEAR BASIS OUTSIDE OF A
RECESSION HAS BEEN
UNPRECEDENTED. OUTSIDE OF
RECESSION, IT IS REALLY NOT
SOMETHING WE HAVE SEEN BEFORE.
>> AND DIRECTOR DURAS, AS WE
MOVE INTO SLIDE 16, CAN YOU
ORIENT US TO THE COLUMNS ON THE
CHART? I KNOW THERE WILL BE
INFORMATION FILLED IN AS WE
CLICK THROUGH SO CAN YOU HELP
US UNDERSTAND THE FOR ACTUAL
2023 WHERE THAT INFORMATION
COMES FROM, WHAT THE OCTOBER
FORECAST, WHERE THAT
INFORMATION COMES FROM?
>> BEFORE WE LOOK AT THE
INDIVIDUAL REVENUE STREAMS,
WHAT THE PICTURE LOOKS LIKE, IT
SHOWS THE ACTUAL REVENUE
RECEIVED FOR 2023 THERE IS AN
ADDITIONAL ROW THAT TAKES OUT
TRENDS, THERE IS A REASON TO
LOOK SEPARATELY AT THE GENERAL
FUND. THE NEXT THREE COLUMNS
ARE THE CURRENT FORECAST. THREE
NUMBERS SHOW THE TOTAL GENERAL
FUND REVENUES THAT WE ARE
CURRENTLY PROJECTING FOR THE
CURRENT YEAR, BASED ON ROUGHLY
50% OF COLLECTION SHALLOW
RECESSION WE HAVE COLLECTED SO
FAR. WE ARE TRYING TO PROJECT
THE REST OF THE YEAR, WHERE IT
WILL END UP ONCE THAT IS 25 AND
FORECASTS. THE NEXT THREE
COLUMNS, WHERE THE RED NUMBERS
ARE STARTING TO SHOW UP, ARE
THE DIFFERENCES BETWEEN THE
CURRENT FORECAST AND THE
FORECAST THAT WE HAVE AND THE
FORECAST USED FOR THE 2025-26
PROPOSED FORECAST. IN AUGUST,
THERE ARE SOME SMALL TECHNICAL
CHANGES. THE DIFFERENCE IS
OCTOBER FORECAST IN COMPARISON
TO THE 2025, 26 PROPOSED
BUDGET.
>> JUST TO CLARIFY, FOR THE
VIEWING PUBLIC, THE THREE
COLUMNS UNDER THE DIFFERENCE
FROM 25 TO 26 SINCE THE BUDGET
WAS TRANSMITTED TO US.
>> THE CHANGE ADD UP TO 48.6
MILLION, THE LARGE PART OF THAT
BEING THE DOWNWARD REVISION FOR
2026 IN GENERAL. THAT SLOW
ECONOMY GROWTH THAT IS DRIVING
THESE REVISIONS, IT ALUM DATES
OVER TIME. SO THESE NUMBERS GET
LARGER AS WE LOOK AT 25 AND 26.
THE SLOW GROWTH IN INCOME AND
SPENDING ADDS UP OVER TIME AND
LOWERS THE REVENUE PROJECTIONS.
SO LOOKING AT THE INDIVIDUAL
REVENUE STREAMS THAT ARE
HIGHLIGHTED IN BLUE, THOSE ARE
THOSE THAT OUR OFFICE IS
FORECASTING. AS BEN MENTIONED
THERE ARE A COUPLE OF REVENUE
STREAMS WHERE CBO IS BETTER
POSITIONED TO FORECAST. AND
THEY REMAIN WITHIN BUDGET
OFFICE. COORDINATES WITHIN
INDIVIDUAL DEPARTMENTS WITH
BETTER INSIGHT INTO WHERE THAT
REVENUE STREAM IS HEADED. WE
ARE DEVELOPING FORECAST FOR THE
ASSESSED VALUE AND FOR NEW
CONSTRUCTION. THAT IS USED AS
THE INPUT FOR PROPERTY TAX AND
THE PROPERTY TAX IS DEVELOPED
BY CBO DATA. SOME INFORMATION
WHERE THE REVISIONS ARE FROM.
>> I WANTED TO EXPLAIN THE
DIFFERENCES FROM THE PROPERTY
TAX. THE GENERAL EXPENSE LEVY
AND THE OTHER IS THE MEDIC ONE
LEVY WHICH ALSO GOES INTO THE
GENERAL FUND. BUT DESIGNATED
FOR THE PURPOSES OF THAT
SERVICE. AND SO, THE CHANGES
YOU SEE HERE, THE NEGATIVE 1.2
MILLION IN 2025 AND THE
NEGATIVE 6.3 IN 2026 ARE ALL
DUE TO THE EMS LEVY. THERE IS A
GAME PLAYED BETWEEN THE AV OF
THE COUNTY AND THE CITY WE GET
CHANGES THROUGHOUT THE YEAR.
THE THE ESSENTIAL MATH IS THEY
HAVE TO FIGURE OUT THE RATE
THEY NEED TO APPLY TO COLLECT
THAT AMOUNT OF LEVY DOLLARS AND
IF THE AV INCREASES THE LEVY
RATE COMES DOWN. THE CITY
RECEIVES ITS ASSESSED VALUE
TIMES THAT RATE. SO IF IT
DOESN'T GROW AT THE SAME RATE,
WE GET A CHANGE IN OUR REVENUE
AND WE GET A NEGATIVE RESULT.
SO THAT'S WHAT'S HAPPENING
HERE. KING COUNTY'S AV IS
INCREASING FASTER THAN THE
CITY'S AV. THERE IS A BIT OF
THAT OWN ON IN 2026 AS WELL. WE
LEARNED TOO LATE TO INCLUDE IN
THE PROPOSED BUDGET THE LIKELY
RATE CHARGED FOR THE RENEWAL OF
THE EMS LEVY FOR COLLECTION IN
2026 IS LESS THAN WHAT WE
ASSUMED. ABOUT A
CENT-AND-A-HALF LESS THAN WE
ASSUMED. THAT RESULTS IN THE
LARGE MINUS 6.3 CHANGE.
>>> ALL RIGHT, MOVING ONTO THE
REVENUES THAT OUR OFFICE IS
RESPONSIBLE FOR. HIGHLIGHTED IN
BLUE. ECONOMICALLY DRIVEN
AFFECTED DIRECTLY BY THE
REVISIONS IN THE ECONOMIC
FORECAST. AS YOU CAN SEE, SALES
TAX REVENUE, BUSINESS AND
OCCUPATION TAX REVENUE HAVE
BEEN REVISED DOWN CONSIDERABLY
OVER THE THREE YEARS THESE TWO
ADD UP TO ABOUT 38 MILLION
DOWNWARD REVISION RELATIVE TO
THE PROPOSED BUDGET FORECAST.
SO 38 OUT OF 48 MILLION IS
COMING FROM THOSE TWO SOURCES.
THEY ARE THE MOST SENSITIVE TO
THE CHANGES IN THE ECONOMIC
OUTLOOK. THAT DIRECTLY FEEDS
INTO THE FORECAST FOR THESE
REVENUE STREAMS. BEYOND THE
EMPLOYMENT DATA REVISIONS. SO
OVER THE THREE YEARS, SALE TAX
HAS BEEN REVISED DOWN. BUSINESS
OCCUPATION TAX HAS BEEN REVISED
DOWN. LOWER CONSTRUCTION
REVENUE MEANS THIS CONTINUES TO
WEIGH DOWN ON THE REST OF THE
SECTORS. THEN, FOR UTILITY
PRIVATE UTILITY TAX, THOSE ARE
THE REVENUES SEAN IS WORKING
ON.
>> FOR PRIVATE UTILITY TAXES,
ESSENTIALLY IN A NUTSHELL, A
LOT OF THE DOWNWARD REVISIONS
WERE THE RESULT TO DO FOR CABLE
AND TELEPHONE TAX REVENUES.
THOSE TAX REVENUES HAVE BEEN
DECLINING. I ASSUME PEOPLE ARE
MOVING AWAY FROM TELEPHONE AND
CABLE TELEVISION TO. OUTSIDE
THE PRIVATE UTILITY TAXES ARE
THOSE, THE TAX REVENUE FOR
STEAM, NATURAL GAS COMING IN
CONSISTENTLY. NO REAL REVISIONS
FOR THOSE. WHEN IT COMES TO
DECIDING THE INFORMATION WE
HAVE CURRENTLY, WE ARE ABOUT
HALFWAY THROUGH. THE NEXT THREE
YEARS THE TOTAL REVENUE WILL BE
REVISED DOWN.
>> SO WE DO CONTINUE TO RECEIVE
SOME RETURNS GOING BACK TO 2021
OBLIGATIONS. AND IT IS NOT
SOMETHING THAT EASY TO
FORECAST. WE ARE ESSENTIALLY
NOT ASSUMING ANYTHING TO
COMING. SO IT IS A SURPRISE TO
THE POSITIVE SIDE. SO 1.4
MILLION THAT HAS BEEN ADDED TO
THIS FORECAST ARE THOSE RETURNS
FOR 2021. PLUS THE PENALTY AND
INTEREST ASSOCIATED WITH THOSE
LATE RETURNS. THEN, THE REST OF
THE REVENUES THAT CBO IS IN
CHARGE OF. WHERE WHERE THERE IS
A BLANK LIKE PUBLIC UTILITY
TAXES, NO REVISION. SO THAT'S
WHAT'S GOING ON WITH ANY OF
THE PLAIN WHITE SPACES. FOR
PARKING METERS AND COURT, YOU
WANT TO SPEAK TO THOSE?
>> SURE. PARKING METERS HAVE
BEEN REVISED DOWN. THE CITY
ADJUSTED THE RATES WE PAY AT
THE PARKING METERS JUST A WEEK
AGO ACTUALLY IN MID OCTOBER.
THOSE CAME DOWN LOWER THAN WE
EXPECTED. THAT'S THE REASON
FOR THE DROP IN A MILLION
DOLLARS. THE COURT IS PROPOSED
PRINCIPALLY OF PARKING
CITATIONS, AND TICKETS. AND
PARKING CITATIONS ARE
RELATIVELY FLAT. THE RED LIGHT
COME AS CONTINUE TO TREND
DOWNWARD SO THE ACTUALS
SURPRISED US TO THE DOWNSIDE OF
IT. DAVE, YOU WANT TO SPEAK TO
THE OTHERS?
>> THE NEXT CATEGORY LICENSES
PERMITS, THAT INCLUDES A LOT OF
DIFFERENT THINGS. THE CHANGES
HERE ARE DUE PRIMARILY ALMOST
EXCLUSIVELY TO THE INTEREST
INCOME. DUE TO A REVISION
UPWARD WE ARE GETTING ON OUR
CASH POOL INTEREST EARNINGS.
THAT IS PRETTY STRAIGHTFORWARD.
I THINK THAT IS ALL WE HAVE TO
SAY FOR THIS CHART.
>> JUST TO SUMMARIZE, NOT
REALLY GOOD NEWS WHEN IT COMES
TO THE SIZE OF THE DOWNWARD
REVISION. , IT IS HALF OF A
PERCENT OF THE GENERAL FUND.
16.9MILLION, ABOUT 1%. AND THEN
25.2 MILLION FOR 26. 1.5%
DOWNWARD REVISION. SO ON
AVERAGE, WE ARE LOOKING AT 1%
DOWNWARD REVISION REIN
TERMS OF THE DOLLAR AMOUNTS.
NOT REALLY THE WORST NEWS WE
ARE DELIVERED LOOKING BACK AT
2020, THE SITUATION HAS BEEN
MUCH MORE DIRE. BUT WE HAVE
SEEN IN 2022 REVISIONS THAT
WERE SIMILARLY PAINFUL.
>> AND BEFORE WE MOVE ON
DIRECTOR, I JUST WANTED TO
CHECK IN WITH THE FORECAST
COUNCIL MEMBERS IF THERE ARE
QUESTIONS ON THIS SLIDE.
>> I CONTINUE HAVE A QUESTION
ON THIS SLIDE. BUT CAN WE GO
BACK TO THE SALES TAX? I DON'T
HAVE A QUESTION ON THIS SLIDE.
BUT THE CHANGE IN THE
HOSPITALITY GIVEN THAT WE,
ASSUMING WE HAD A GOOD SUMMER,
IT SEEMS LIKE OUR HOSPITALITY,
LEISURE AND HOSPITALITY RATE
HAS CHANGED SIGNIFICANTLY. CAN
YOU COMMENT ON THAT?
>> I DON'T KNOW IF IT IS THIS
PARTICULAR CHART. IN THIS
CHART, LEISURE AND HOSPITALITY
CONTRIBUTIONS OF LEISURE AND
HOSPITALITY TO THE OVERALL
SALES TAX GROWTH IS SHOWN IN
RED BARS. THEY DO TEND TO BE ON
THE POSITIVE SIDE SO THE RED
CHUNKS OF BARS ARE ABOVE ZERO.
WITH THE EXCEPTION I GUESS OF
ONE, TWO, THREE, FOUR, THAT
LOOKS LIKE APRIL AND THEN JULY.
FOR JULY IT'S THE YEAR OVER
YEAR EFFECT THAT WE HAVE HERE.
IF YOU LOOK BACK AT THE EVENTS
TAKING PLACE IN JULY, 2023. HOW
MUCH EXCITEMENT THERE WAS ABOUT
THINGS GOING ON BACK IN JULY OF
2023. THAT INCREASED REVENUES
IN 2023. SO THE YEAR OVER YEAR
COMPARISON IS BIASED BECAUSE OF
THAT.
>> THANK YOU FOR THE ADDITIONAL
CLARIFICATION.
>> THANK YOU. OTHER FORECAST
COUNCIL MEMBERS? JEREMY?
>> THANK YOU VERY MUCH. IT IS
EASY TO UNDERSTAND
CONSTRUCTION. WE UNDERSTAND IT.
BUT CAN YOU GO BACK TO THAT
OTHER CHART? TRADE IS
CONCERNING. IS THAT A FUNCTION
OF A WEAKER WORLD ECONOMY, AND
OTHER TRADING PARTNERS AND THAT
THEY ARE ABLE TO PURCHASE FROM
US?
>> WE WERE TRYING TO LOOK INTO
THE UNDERLYING REASONS FOR WHY
THEY ARE PERFORMING SO POORLY.
THIS PARTICULAR SECTOR HAS
GROWN, CONTRIBUTIONS OF THAT
PARTICULAR SECTOR HAVE BEEN
QUITE SIGNIFICANT IN THE YEARS
RIGHT AFTER PANDEMIC. PEOPLE
WOULD NOT SPEND MONEY ON TRAVEL
AND EXPENSES THEY TENDED TO BUY
MORE GOODS. EITHER FURNITURE
FOR THEIR HOMES, RENOVATE THEIR
HOMES. THEY WOULD MAKE SOME BIG
TICKET PURCHASES. THEN THERE
WAS ONCE THE THE RESTRICTIONS
WERE LIFTED, PEOPLE STARTED TO
SLOWLY MOVE THEIR SPENDING BACK
TOWARD THOSE PATTERNS WHERE
THEY WOULD TRAVEL MORE. AND SO,
THERE IS LITTLE BIT OF THAT
EFFECT. LESS SPENDING ON GOODS
AND BECAUSE OF THAT, THE SALES
TAX REVENUE FROM TRADE SECTOR
WHICH IS AGAIN MOSTLY SPENDING
ON GOODS, PERFORMING POORLY. A
LOT OF IT IS COMING FROM THE
SALES OF MOTOR VEHICLES THAT
HAVE DECLINEDQUITE
CONSIDERABLY YEAR OVER YEAR.
THE IMPACT OF FEWER VEHICLES
PURCHASED HAS PULLED EVERYTHING
DOWN.
>> I WILL ASK US TO CONTINUE
MOVING ON. JUST HIGHLIGHTING
THAT THIS PRESENTATION DOESN'T
INCLUDE THE EXCISED TAX,
PAYROLL TAX OR AD TAX. WE HAVE
BEEN HAVING THESE DOWNWARD
TRAJECTORY WAS HAPPENING LAST
YEAR. WE HAD, WE CAME BACK IN
QUARTER ONE. BUT NOW WE ARE
BACK ON THIS NEGATIVE
TRAJECTORY AGAIN WITH THE SALES
AND USE BUSINESS OCCUPATION.
AND THESE OBLIGATIONS. PAYROLL
OBJECT GRACES AND PROPERTY TAX.
THERE IS SOME SILVER LINING. WE
WILL GET INTO THAT NOW. WE HAVE
BEEN OFFSET IN THE NET. SO AT
THE END OF THE DAY WE HAVE BEEN
WHOLE. THIS YEAR IS DIFFERENT.
THAT'S THE BAD NEWS IS WE
DON'T HAVE GOOD NEWS OFFSETING
THE BAD NEWS.
>> IF I COULD INTERJECT
QUICKLY. FOR THE PROPERTY TAX.
WE WEREN'T ABLE TO BUILD THIS
IN, INTO THE FORECAST. BUT WE
WERE ABLE TO SET ASIDE $4.7
MILLION IN A RESERVE. I THINK
DR. NOBLE IS AWARE OF THIS. BUT
JUST FOR GOOD NEWS. SO IT IS
4.7 MILLION LESS IN DEALING
WITH A PROBLEM.
>> THANK YOU. BACK TO YOU
DIRECTOR DURAS.
>> ALL RIGHT. SO MOVING ONTO
BETTER NEWS. THE OUTLOOK FOR
THE NONGENERAL FUND REVENUES
HAS NOT BEEN REVISED DOWN
CONSIDERABLY, IN FACT, FOR SOME
OF THEM, THERE HAVE BEEN UPWARD
REVISIONS THAT PARTIAL LOVESEAT
THE GENERAL FUND REVENUES. THE
OVERALL REVISION ADDS 27.4
MILLION. SLIDE INCREASE IN 24.
AS THE EFFECTS ACCUMULATE OVER
TIME. WE HAVE ONE MORE SLIDE ON
PAYROLL EXPENSE TAX THAT
FOLLOWS SO I WILL LEAVE THAT
FOR A SECOND. MOVING ONTO RATE.
WE HAVE SEEN ADDITIONAL, ABOUT,
2 MILLION ADDITIONAL REVENUE
FROM SEVERAL LARGER SALES THAT
HAS LED TO AN INCREASE IN THE
FORECAST FOR 24. THE FACT THE
INTEREST RATES ARE COMING DOWN
FASTER THAN PREVIOUSLY EXPECTED
FEEDS INTO A BETTER OUTLOOK FOR
25 AND 26. THE MORTGAGE RATES
HAVE LOCKED IN A LOT OF
POTENTIAL SELLERS TO THE
OVERALL AMOUNT OF HOMES SOLD
HAVE BEEN LOW RECENTLY. PEOPLE
WHO HAVE BEEN RTGAGE BELOW 3%.
CURRENTLY THEY ARE UPWARDS OF
6%. SO UNLESS THERE ARE GOOD
REASONS TO MOVE TO SELL THE
CURRENT HOME, THEY WOULD NOT DO
IT. AS THE INTEREST RATES COME
DOWN, THE PAIN OF ACCEPTING
HIGHER INTEREST RATES WILL
DIMINISH AND SEIZE. SO THAT IS
AGAIN, SOMETHING THAT IS
DRIVING UP THE REVENUE. IT ADDS
ABOUT 10 MILLION. THERE IS A
SMALL DOWNWARD REVISION THAT
HAS TO DO WITH SOME FINE TUNING
OF OUR FORECASTING OF
INDIVIDUAL CATEGORIES. NOT
NECESSARILY AN IMPACT OF LESS
OF TOURISM OR LESS FOOT TRAFFIC
SEEN IN SEATTLE AREA HAS JUST
SOME TECHNICAL ISSUES. HOW
DIFFERENT CATEGORIES CONTRIBUTE
HERE. THEN THE BLUE LINE FOR
SALES TAX SAME FACTORS AT PLAY
HERE. THE SALES TAX THAT GOES
INTO THE GENERAL FUND. DOWNWARD
REVISION DUE TO THOSE SAME
FACTORS IS TAKING PLACE HERE.
FINALLY. THE SHORT TERM RENTAL
TAX.
>> THANK YOU. I WAS REMISS
EARLIER. I DIDN'T INTRODUCE
ONE OF OUR TEAMMATES, ALEXANDRA
ZHANG. SHE HAS FORECAST THE
SHORT TERM RENTAL TAX.
ESSENTIALLY WHAT THIS IS, IS
CAPTURING WHAT ACTUALS HAVE
BEEN IN 2024. THEY HAVE BEEN UP
A BIT. WHICH IS A GOOD SIGN. SO
THIS JUST CARRIES THROUGH INTO
THE THREE YEARS.
>> ALL RIGHT, SO WITH THAT, I
WILL WANT TO ADD A FEW MORE
THINGS. GOING BACK TO THE
REASON WHY WE HAVE INCREASED
THE FORECAST BY 2.4 MILLION FOR
THIS YEAR, THE STOCK MARKET IS
PERFORMING VERY WELL. THEY ARE
GROWING AND THE PURPLE DOTS IN
THIS CHART SHOW THE EXPECTED
YEAR OVER YEAR GROWTH IN THE
STOCK PRICES FOR A SELECT
COUPLE OF COMPANIES THAT ARE
HERE YOU CAN SEE THE STOCKS
PRICES HAVE GONE UP OR ARE
EXPECT TODAY GO UP QUITE
CONSIDERABLY IN 24 OVER 23
COMPARISON SHOWN AGAIN BY THOSE
PURPLE DOTS. THE OUTLOOK FOR
2025 IS SHOWN HERE WITH THE
BLUE DOTS FOR THE AVERAGE
FORECAST AND THE LINE SPREADS
BETWEEN THE LOW AND HIGH
ESTIMATE. ALL OF THESE ARE
COMING FROM WALL STREET JOURNAL
DATA THE DATA THE WALL STREET
JOURNAL USES. THE REASON HERE
IS THAT A LARGE PART OF
COMPENSATION IS IN THE FORM OF
STOCK BRAND SO WHEN THOSE ARE
PERFORMING WELL, WE HAVE
REASONS TO BELIEVE THAT THE
PAYROLL EXPENSE TAX WILL
PERFORM QUITE WELL. THOSE TEND
TO DOMINATE AS THEY HAVE IN THE
PAST. WE HAVE IN MIND THE FACT
THERE HAVE BEEN LAYOFFS SINCE
2022 AS YOU HAVE SEEN IN THE
CHART FOR PROFESSIONAL BUSINESS
SERVICES INFORMATION, AND TRADE
SECTOR. SO TECH KENS IN GENERAL
NOT ONLY IN INFORMATION. THEY
WOULD BE CLASSIFIED AS OTHER
SECTORS. IT IS A PROFESSIONAL
AND BIDS SERVICES. AMAZON.COM.
THE RETAIL COMPONENT. THAT
WOULD BE IN TRADE. THAT WOULD
BE THE REASON WHY THOSE COUPLE
OF SECTORS COMBINED ARE SO
IMPORTANT FOR THE LOCAL ECONOMY
AND REVENUE COLLECTION. SO
AGAIN, GOING BACK TO STOCK
PRICES VERSUS THE EMPLOYMENT
OUTLOOK. THEY HAVE A NEGATIVE
IMPACT ON THE REVENUE
COLLECTION, WE HAVE STARTED TO
LOOK AT THE MOMENT DATA. WE
HAVE BEEN ABLE IN THE LAST TWO
YEARS TO SECURE DATA FROM THE
EMPLOYMENT SECURITY DEPARTMENT
FOR THE EMPLOYERS IN SEATTLE
AREA. AND SO, WE ARE NOW ABLE
TO START TO FIGURE OUT THE
EFFECT ON THE PAYROLL EXPENSE
TAX COMING FROM CHANGES IN THE
EMPLOYMENT VERSUS CHANGES IN
THE STOCK PRICES. STILL
RELATIVELY EARLY STAGES. BUT SO
FAR, WHAT WE ARE ESSENTIALLY
SEEING, WHAT WE BELIEVE IS
GOING ON IS THAT IF YOU HAVE
LET'S SAY 100 EMPLOYERS, SAY
5% OF THEM ARE LAID OFF. AND
THAT WOULD OTHERWISE PULL DOWN
THE OVERALL COMPENSATION. IF
YOU HAVE THOSE 100 EMPLOYERS
WHO HAVE PART OF THEIR SALARY
IN A STOCK GRANT. 150K BASE.
AND THOSE FRAUDULENTS GO UP BY
20% OVERALL, YOU WILL SEE AN
INCREASE IN THE PAYROLL PAID BY
THE COMPANY. EVEN IN THE
PRESENCE OF THE 5%. WORK FORCE.
DECREASE. AND SO THE EFFECT OF
THAT, THE CHANGES OF
EMPLOYMENT. AND AGAIN, THERE
HAVE BEEN LAYOFFS. THERE HAVE
NOT BEEN VISIBLE WHEN YOU ARE
LOOKING AT THE OVERALL PAYROLL
TAX BECAUSE THEY ARE SMALL
RELATIVE DUE TO STOCK PRICE
CHANGES. FOR 2025, WE EXPECT
STOCK MARKETS TO CONTINUE TO
GROW. WE ARE MOVING FROM
INDIVIDUAL COMPANIES AND
OUTLOOK FROM INDIVIDUAL
COMPANIES. AND LOOKING AT THE
OUTLOOK FOR STOCK PRICES AN
STOCK MARKET AS A WHOLE. THE
S&P GLOBAL EXPECTS THE STOCK
PRICES, SLIGHTLY SLOWER THAN
COMPARED TO 2024. 5.4% GROWTH.
AND THEN, THEY ACTUALLY PREDICT
A DECLINE IN 26. 3.6% DECLINE
IN THE BASELINE SCENARIO.
PESSIMISTIC SCENARIO AND THE
RECESSION WOULD. THE ECONOMY
OVERALL, STOCK PRICES WOULD
DECLINE ALREADY IN 2025.
INSTEAD OF GROWING TO 1.3%
DECLINE RATHER THAN 5.4%
INCREASE.
>> AND AT THE END OF SLIDE 20 I
WILL ASK THE FORECAST MEMBERS
IF THEY HAVE QUESTIONS OVER THE
LAST THREE SLIDES.
>> SOUNDS GOOD. SO FAR WE HAVE
BEEN LOOKING AT THE BASELINE
SCENARIO FORECAST. THESE
SUMMARIZE THE ALTERNATIVE
SCENARIOS. THE OPTIMISTIC AND
THE PESSIMISTIC SCENARIO. AND
COMPARE THEM TO THE BASELINE
SCENARIO FORECAST. DEPENDING ON
THE REVENUE STREAM THAT WE ARE
LOOKING AT. THAT SPREAD BETWEEN
THE OPTIMISTIC AND PESSIMISTIC
SCENARIO. THE EXPENSE TAX
LOOKING AT 2026. GIVEN HOW MUCH
STOCK PRICES CAN GROW OR
DECLINE. AND THE UNCERTAINTY
RATE, THE OUTLOOK FOR STOCK
PRICES SO FAR OUT. IT IS NOT
SURPRISING THAT THE RANGE WILL
BE MUCH LARGER THAN THE RANGE
FOR BUSINESS AND OCCUPATION AND
SALES TAX. WHERE THE IMPACT OF
A RECESSION WOULD BE MUCH, MUCH
SMALLER. ONE THING YOU CAN SEE
HERE IS THE RISKS ARE SKEWED
TOWARD THE DOWNSIDE. SO THAT
OPTIMISTIC SCENARIO LINE IS
ABOVE THE BASELINE. THE
DISTANCE BETWEEN THE OPTIMISTIC
AND THE BASELINE IS MUCH
SMALLER THAN THAT GAP BETWEEN
THE BASELINE AND THE
PESSIMISTIC SCENARIO FORECAST.
>> AND IF YOU WANT TO STICK TO
THAT. ONE MORE SLIDE. WE'LL
TAKE THIS AS A GROUP FOR THE
FORECAST COUNCIL MEMBERS.
>> THEY WILL HEAR NOW COMPARES
THOSE ALTERNATIVE SCENARIOS TO
THE BASELINE. AND FOCUSES ON
MAIN ECONOMICALLY DRIVEN
REVENUES. FOR GENERAL FUND,
THAT SALES TAX, BUSINESS AND
OCCUPATION AND UTILITY TAXES.
IN ADDITION, WE ARE ADDING THE
TABLE HERE PRESENTS THE PAYROLL
EXPENSE TAX. THE TOTAL GENERAL
FUND REVENUES WOULD BE BETWEEN
17 MILLION AND 69 MILLION LOWER
. SALES TAX AND BUSINESS AND
OCCUPATION TAX IN CASE OF THE
OPTIMISTIC SCENARIO. THERE IS
SOME UPSIDE. JUST SMALLER AND
THE INCREASE IS ONLY $37
MILLION BECAUSE OF THAT.
PAYROLL EXPENSE TAX, 45 MILLION
LESS FOR CURRENT YEAR. COMPARED
TO BUSINESS AND OCCUPATION TAX.
FOR IT, A LITTLE BIT OF A
DOWNSIDE. A LITTLE BIT OF AN
UPSIDE. SLIGHTLY SKEWED TOWARD
THE DOWNSIDE. ESPECIALLY FOR 25
AND 26. INTEREST RATES AND HOW
MUCH THEY MATTER FOR SALES OF
HOMES AND THE OVERALL
UNCERTAINTY REGARDING THE PAST
OF THE INTEREST RATE. THAT IS
SOMETHING THAT MATTERS HERE THE
MOST FOR THIS PARTICULAR
REVENUE STREAM.
>> THANK YOU DIRECTOR
MEMBERS IF THEY HAVE. I WILL
START US OFF WITH ONE. IT IS
MORE TYPICAL TO HAVE AN EVEN OR
SIMILAR AMOUNT OF SPACE BETWEEN
THE PESSIMISTIC AND THE
BASELINE AS WELL AS THE
BASELINE AND THE OPTIMISTIC.
ARE THERE ADDITIONAL RISKS
HERE? IS THIS WHAT THE S&P WAS
GETTING TO WITH THE PROBABILITY
FOR EACH OF THESE DIFFERENT
POTENTIALITIES BEING DIFFERENT.
WHEN IT COMES TO THE NATIONAL
FORECAST. THERE ARE RISK FOR
THE DOWNSIDES ARE SOMETHING
THAT HAS BEEN AROUND FOR SOME
TIME. SO THAT GAP BETWEEN THE
BASELINE AND THE PESSIMISTIC
SCENARIO DUE TO RECESSION
OCCURING IN 12 MONTHS THAT HAS
BEEN THERE IN LAST YEAR. THAT
BALANCE OF RISK WOULD BE MORE
EVEN. THE POTENTIAL RECESSION,
AND VERY FEW THINGS AT THE SAME
TIME THAT CAN GO BETTER THAN
EXPECTED. THERE IS STILL A LOT
OF UNCERTAINTY REGARDING THE
LIKELIHOOD OF A SOFT LANDING.
AND AGAIN, COMING UP WITH
THINGS THAT CAN GO POTENTIALLY
BETTER. THE NATIONAL ECONOMY IS
DOING REMARKABLY WELL. THERE
ISN'T A WHOLE LOT OF UPSIDE
LEFT. INTEREST RATES ARE COMING
DOWN, THERE'S NOT A WHOLE LOT
BETTER IT COULD BE DOING AT
SOME LEVEL. OBVIOUSLY, LOCALLY,
THAT IS A DIFFERENT STORY
THERE. ON THE DOWNSIDE, WORLD
EVENTS ARE SUCH THAT LIKE, IT
DOESN'T TAKE LONG TO SORT OF
SPIN UP A SCENARIO WHERE HIGHER
ENERGY PRICES, THE STUFF WE SAW
SPIN UP AGAIN AND DRIVE YOU
INTO A DARKER PLACE. TO MY
MIND, THAT IS WHERE THAT
ASYMMETRY COMES FROM. WE ARE
DOING QUITE WELL. BUT THEN
THERE ARE OBVIOUSLY SITUATIONS
ACROSS THE GLOBE THAT COULD
HAVE SIGNIFICANT NEGATIVE
IMPACT ON A NATIONAL NEVER MIND
INTERNATIONAL SCALE.
>> WE ARE STILL ON THE WAY TO A
SOFT LANDING. BUT THERE'S A
LITTLE BIT OF TURBULENCE BEFORE
HITTING THE TARMAC. IS THAT
WHAT I'M HEARING?
>> IT HAS BEEN CHARACTERIZED AS
A BUMPY RIDE. BUT YEAH,
HOPEFULLY A SOFT LANDING IN
SIGHT.
>> I HAVE COUNCILMEMBER KETTLE
WITH A QUESTION. COUNCILMEMBER
NELSON, JEREMY?
>> I DO HAVE A QUESTION. I
DON'T KNOW WHICH SLIDE IT
APPLIES TO BUT I ASK MYSELF
ABOUT IT. WHEN WE TALK PET
REVENUES, HOW CLOSELY ARE YOU
TRACKING THE DECLINE THAT IS
DUE TO THOSE WORKERS NO LONGER
IN SEATTLE?
>> SO, THE DATA WE HAVE
AVAILABLE ALLOWS US TO GET SOME
INSIGHT INTO THE EMPLOYMENT
CHANGES IN CITY VERSUS OUTSIDE
OF A CITY. IT IS NOISY SORTFORMY
HOW THINGS ARE REPORTED TO THE
ESD. THE MAIN IDEA IS THAT THE
DATA IS COMING FROM THE
UNEMPLOYMENT INSURANCE.
DEPENDING ON THE COMPANY, IT
CAN BE THE COMPANY'S
HEADQUARTERS. IF THEY HAVE
SEVERAL LOCATIONS IN THE
COUNTY. WE ARE RESTRICTED IN
OUR ABILITY TO FIGURE OUT HOW
MUCH OF THAT DEPLOYMENT IS IN
CITY VERSUS OUTSIDE, BUT FOR
COMPANY WITHS ONLY ONE
LOCATION, AND THEY OPEN A NEW
LOCATION ELSEWHERE, THAT WOULD
BE SOMETHING WE COULD SEE. WE
WILL BE ABLE TO GET SOME
INSIGHT.
>> SO YOU HAVE TALKED ABOUT THE
PET BEING SOMEWHAT, NOT
NECESSARILY VOLATILE, BUT
UNCERTAIN. BECAUSE OF POTENTIAL
LAYOFFS IN THIS SECTOR.
HOWEVER, WHAT I'M HEARING YOU
SAY RIGHT NOW IS THAT YOU ARE
NOT TRACKING VOLATILITY BASED
ON WHERE THE ACTUAL EMPLOYEE
IS.
>> TO THAT EXTENT WE ARE ABLE
TO DO THAT. FOR SOME COMPANIES
IT IS EASIER THAN FOR OTHERS
DEPENDING ON HOW MANY LOCATIONS
THEY HAVE. DEPENDING ON HOW
THEY ARE FILING. IT IS AN
EFFORT THAT TAKES TIME. WE ARE
INCORPORATING THOSE EMPLOYMENT
CHANGES AND WHEN WE ARE LOOKING
TO THOSE. TO THE EXTENT IT IS
POSSIBLE WE ARE LOOKING AT
CITIES OF SEATTLE VERSUS
OUTSIDE. OTHER THAN THAT, IT IS
ABOUT LOOKING AT CORRELATIONS
AGAIN IN DATA. TRYING TO MAKE
THE BEST OF WHAT WE HAVE.
>> IF THE COMPANY HAS A BASE IN
SEATTLE AND IF THEY ARE
HEADQUARTERS IN SEATTLE BUT
HAVE AN OFFICE ACROSS THE LAKE,
THAT IS WHAT WE ARE TALKING
ABOUT IS MULTIPLE LOCATIONS.
>> THAT WOULD BE A CASE, YEAH.
THEY COULD HAVE OFFICES IN
SEATTLE OR THE EAST SIDE. WHERE
THOSE EMPLOYEES WORK. TO THE
EXTENT THAT THEY ARE STILL
WORKING FROM HOME. THAT IS AN
ADDITIONAL LAYER OF
UNCERTAINTY. IT IS NOT JUST THE
EMPLOYMENT ITSELF THAT MATTERS.
BUT IN TERMS FROM THE WORK FROM
HOME. IF SOMEONE IS LIVING
OUTSIDE OF SEATTLE AND PERFORMS
THE WORK AT HOME. DOES NOT
COMMUTER TO THE OFFICE. THAT
WOULD NOT BE PART OF IT. THAT
IS WHY WE ARE TRACKING THE
RETURN TO THE OFFICE AND USING
THAT AS AN ADDITIONAL INPUT IN
THE FORECAST.
>> THANK YOU. ANYTHING ELSE
HERE? WITH THAT, I WILL YEP. I
WILL PASS IT OVER TO
COUNCILMEMBER KETTLE.
COLLEAGUES I WILL ASK US TO
STAY ON PAYROLL EXPENSE TAX
REAL ESTATE. SWEETENED BEVERAGE
TAX, SHORT TERM RENTAL. BENEFIT
TRANSPORTATION AND COMMERCIAL
PARK BECAUSE WE WILL THEN BE
MOVING TO THE NEXT SLIDE WHERE
IT GETS MORE GENERAL AGAIN.
>> THANK YOU CHAIR STRAUSS AND
DIRECTOR NOBLE FOR YOUR
NATIONAL OUTLOOK. AND IT
DOESN'T SEEM TO MATCH
POLITICAL RHETORIC WHICH
HIGHLIGHTS MISINFORMATION THAT
HAPPENS ACROSS THE COUNTRY. AND
I WOULD ADD IN OUR OWN CITY.
DIRECTOR DURAS, THANK YOU. I
SHOULD ALSO SAY THANK
MR. THOMPSON. THANK YOU ALL FOR
BEING HERE AND THE
PRESENTATIONS OVER THE LAST
SECTION. I REALLY APPRECIATE
THE POINTS ABOUT TRADE. IT IS A
GOOD REMINDER THAT WE ARE A
MAJOR PORT CITY. AND THE PORT
HAS TO BE CENTRAL IN OUR POLICY
DECISIONS AND WHAT WE DO MOVING
FORWARD. TO THE SECTION HERE, I
WAS REALLY STRUCK BY YOUR POINT
THAT YEAR OVER YEAR, SALES TAX
DOWNTURN IS UNPRECEDENTED. I AM
INTERESTED IN YOUR THOUGHTS
WHY. IT IS REALLY IMPORTANT.
THE SALES TAX IS NEARLY 80% OF
THE 46 MILLION DOWNTURN RELATED
IN THOSE TWO AREAS. IT IS
BECAUSE OF THE POLICIES OF CITY
GOVERNMENT THAT CREATED SOME OF
THE SITUATIONS WE SAW ON THE
GROUND REGARDING URBAN
DISORDER. YEAH, WE HAD THE
PANDEMIC. BUT WE CAME DOWN WITH
POLICIES THAT CREATE THE
CHALLENGES WE ARE DEALING WITH
TODAY. AND THE IMPACT IS HUGE.
WHEN 80% OF IT IS RELATED TO
SALES. ON THE SMALL END, WE
HEARD ABOUT HOW WE TOOK OUT
PARKING ENFORCEMENTS. THAT WAS
A DISASTER. YOU KNOW, WHEN WE
HAVE THE ORGANIZATIONS THAT ARE
PART OF THE COLLECTION IN
DISORDER, WE SHOULDN'T BE
SURPRISED. AND SO. BY THE WAY,
I WAS LOOKING FORWARD, WHAT WE
JUST DID. EVEN THE DOWNTURN
ACTIVATION PLAN IS SO IMPORTANT
TO THE POINT I'M MAKING. THAT
GOES TO THE OTHER POINT I WAS
MAKING. YEAR OVER YEAR SALES
TAX DOWNTURN IS UNPRECEDENTED.
YOUR THOUGHTS, WOULD YOU AGREE
OR DISAGREE? ARE THERE
ADDITIONAL PIECES? HOW WOULD
YOU PLAY THAT OUT IN TERMS OF
THE UNPRECEDENTED NATURE OF THE
DOWNTURN?
>> IT IS SOMETHING THAT HAS NOT
BEEN SEEN. A LOT OF IT IS THE
CONSTRUCTION SECTOR WEIGHING
DOWN AT THE SAME TIME. AS THOSE
SPENDING PATTERNS SHIFTING FROM
GOOD, IF SOMEBODY TRAVELS OUT
OF SEATTLE. ONE THING THAT
WOULD BRING PEOPLE INTO
SEATTLE. THERE ARE CERTAINLY
POLICIES THAT WOULD INCREASE
THE TAX BASE AND MAKE THE CITY
MORE ATTRACTIVE TO VISITERS AND
PEOPLE TO WORK HERE. THE FACT
THAT WE ARE SEEING THIS
DOWNWARD. THE IMPACT OF OTHER
THINGS GOING ON IS NOT
NECESSARILY THE IMPACT IN TERMS
OF RETURN TO THE OFFICE AND IN
TERMS OF A NUMBER OF VISITORS
COMING INTO SEATTLE. THINGS
LIKE THAT.
>> IF THERE ARE NO OTHER
QUESTIONS IN THIS SECTION OF
THE FORECAST, WE WILL MOVE INTO
THE OVERVIEW AND THEN WE WILL
BE TAKING A VOTE AS THE
FORECAST COUNCIL. AS WE ARE
MOVING INTO, I'LL SAVE MY
FINAL COMMENTS FOR THE VOTE IF
YOU WANT TO TAKE IT FROM HERE
DIRECTOR DURAS.
>> ALL RIGHT, THANK YOU. SO
THIS IS A SUMMARY OF WHAT HAS
BEEN PRESENTED AND ADDITIONAL
THOUGHTS ON FORECAST RISKS. THE
FIRST TO QUICKLY SUMMARIZE THE
OUTLOOK OF THE NATIONAL
ECONOMY. BASED ON THE S&P
GLOBAL'S FORECAST, THE
BASELINE SCENARIO HAS A 5%
PROBABILITY ATTACHED TO IT.
RECESSION, 25% CHANCE TO OCCUR.
IN IT LOOKS LIKE S&P GLOBAL'S
FORECAST IS SLIGHTLY MORE
CONSERVATIVE REGARDING THE
ECONOMIC GROWTH IN 25 AND 26.
IN ADDITION TO THE CHANGES IN
THE NATIONAL FORECAST, THE
REASON WE HAVE SEEN THE
DOWNWARD REVISION IN REV NEWS
IS OVERALL WEAKER OUTLOOK FOR
REGIONAL EMPLOYMENT. DUE TO THE
DATA REVISIONS AND THE LAYOFFS
AT BOEING THAT DON'T
NECESSARILY HAVE A LARGE DIRECT
EFFECT BUT THE INDIRECT EFFECTS
ARE RELEVANT HERE. A COUPLE OF
THINGS THAT WE DO SEE. FIRST OF
ALL, IT IS AN ELECTION YEAR.
AND THE BASELINE SCENARIO DOES
NOT INCORPORATE SOME OF THOSE
POLICIES THAT MIGHT BE
IMPLEMENTED BY THE CANDIDATES
RUNNING FOR THE PRESIDENT OF
THE U.S. DEPENDING ON HOW THE
ELECTIONS GO. WHETHER IT IS
DIVIDED GOVERNMENT OR
REPUBLICANS AND DEMOCRATS
COMPLETELY IN CONTROL, THINGS
CAN BE WORSE DEPENDING ON HOW
THINGS GO. AND THE INPOLICE
STATIONS CAN COME BACK DUE TO
SOME OF THE POLICY PROPOSALS
REQUIRING FEDS TO STEP IN AND
BALANCE THE RISK OF HIGHER
INFLATION. REQUIRING HIGHER
INTEREST RATES AND ONCE AGAIN
WOULD POSE A HEAD WIND TO THE
ECONOMIC GROWTH. SO THERE IS A
LOT OF THINGS THIS ARE
UNCERTAIN AND WILL NOT GET
RESOLVED IN, THAT WILL GET
RESOLVED IN THE NEXT COUPLE OF
MONTHS. THE FORECAST CAN CHANGE
DEPENDING ON HOW THINGS GO. THE
SECOND THING, THE OUTLOOK FOR
COMMERCIAL REAL ESTATE IS STILL
UNCERTAIN. A LOT OF KIT HAS
BEEN ISSUED. THAT COULD
POTENTIALLY LEAD TO SOME
FAILURES IN SOME FAILURES IN
THE BANKING SECTORS. NOT
NECESSARILY BIG BANKS FAILING
BUT SOME SHAWLER BANKS CAN BE
FAILING AND DEPENDING ON WHICH
PART OF THE REGION WE ARE
LOOKING AT, WHICH PART OF THE
U.S. WE ARE LOOKING AT, THAT
UNCERTAINTY IS MORE OR LESS
RELEVANT. NOT A BIG RISK FOR
THE NATION AS A WHOLE. BUT
POTENTIALLY THE RISK FOR
REGIONAL ECONOMIES.
CONSTRUCTION SECTOR SLOWDOWN
HAD BEEN THINGS WE HAVE
DISCUSSED HERE CONSIDERABLY.
AND DEPENDING ON THE INTEREST
RATES, IF THEY CONTINUE TO GO
DOWN OR THE FED HAS TO SLOW
DOWN BECAUSE OF OTHER SHOCKS TO
THE ECONOMY. THAT CAN WORSEN OR
IMPROVE THE OUTLOOK. THIRD
POINT SPEAKS TO THE EMPLOYMENT
DATA. WE HAVE SEEN THOSE
TOWNWARD REVISIONS. THAT HAS
NOT BEEN INCORPORATED INTO ANY
OF THE FORECASTS. WE
ACKNOWLEDGE IT. IT IS JUST HARD
TO QUANTIFY AND DIRECTLIEST
MATE AND FIGURE OUT HOW MUCH OF
A RISK THAT MIGHT BE. FINALLY,
WE HAVE TALKED LAST TIME IN
JULY REGARDING, WE HAD
DISCUSSION REGARDING THE RISING
OFFICE VACANCY RATES AND THE
INITIAL RISKS IT WOULD POSE TO
JOB GROWTH. THAT IS NOT NEW,
SAME THING AS BEFORE. SO
ACKNOWLEDGING ALL OF THESE
RISKS, WE DO CONSIDER BASELINE
SCENARIO TO BE THE MOST LIKELY
OUTCOME FOR 24, 26. THE
UNCERTAINTY IS LARGE. THE FED
WILL HOPEFULLY BE ABLE TO STICK
TO THE SOFT LANDING. IF THE
ELECTIONS DON'T END UP IN SOME
POLICIES THAT ARE GOING TO BE
IMPLEMENTED THAT WOULD RESULT
IN INTEREST RATES THAT NEED TO
BE INCREASED. THAT BASELINE
SCENARIO IS MOST LIKELY, VERY
LIKELY TO BE WHAT WILL TAKE
PLACE SO THAT IS THE SCENARIO
WE ARE DREAMTS.
>> THANK YOU DIRECTOR DURAS. I
WILL MAKE A FEW COMMENTS AND I
WILL PASS IT OVER TO MY
COLLEAGUES ON THE FORECAST
COUNCIL AND THEN OPEN IT UP TO
MY COUNCIL COLLEAGUES HERE THE
PUNCH LINE IS I THINK YOU ARE
TAKING YOUR RECOMMENDATION FOR
THE RECOMMENDING THE BASELINE
SCENARIO IS THE CORRECT
DETERMINATION. THAT'S WHERE I
WILL BE TODAY. I WANTED TO
RESPOND TO THE PRESENTATION. WE
ARE STILL SUFFERING FROM THE
DOWNSTREAM ECONOMIC IMPACTS OF
THE PANDEMIC. I'M GLAD TO HEAR
THAT WE ARE STILL ON TRACK TO
MEET THE SOFT LANDING AFTER THE
FED CUT INTEREST RATES LAST
MONTH. AND THE TURBULENCE HAS
GIVEN ME SOME PAUSE. AGAIN,
LOOKING BACK AT YOUR
PRESENTATION. THIS WAS THE MINI
RECESSION OCCURRING IN AUGUST.
WE TALKED ABOUT THE LAST TIME
THIS HAPPENED. THE LAST TIME
WAS AFTER THE INITIAL PANDEMIC
RECESSION THAT FORCED US BACK
TO PASS, WE DID BUDGET IN 2020
DURING JULY. JUNE, JULY, AUGUST
AS WELL. PREVIOUS TO 2020, IT
WAS 2008. SO I WANTED TO CENTER
WHERE WE ARE IN THE ECONOMIC
CYCLES AND WHERE WE ARE TODAY
IN THE BUDGET. THE HARDEST PART
OF THIS NEWS, WE NOW HAVE ABOUT
$20 MILLION GAP WITHIN THE
PROPOSED BUDGET WE RECEIVED
FROM THE MAYOR. SO THAT'S WHEN
WE ADD AND SUBTRACT ALL THE
PAYROLL PLUSES, THE RATE PLUSES
AND THE GENERAL FUND NEGATIVES.
WE HAD A HARD JOB BEFORE, NOW
IT IS HARDER. THIS IS HARD
BECAUSE I HEARD MANY OF US
AGREE ON THE BENEFIT OF SO MANY
PROGRAMS. WE ALL WANT TO BE
ABLE TO DO THESE THINGS AND
WHAT WE HAVE JUST LEARNED IS
THAT WE HAD A HARD JOB LAST
WEEK AND THIS JOB IS HARDER
TODAY. USUALLY DURING THE
FORECAST, WE RECEIVE AN UPWARD
REVISION THAT IS TYPICAL. EVEN
IF IT'S A COUPLE MILLION
DOLLARS. THAT COUPLE MILLION
DOLLARS REALLY CAN BUOY US IN
THIS MOMENT. AND THIS IS THE
FIRST TIME IN A LONG TIME,
SINCE 2020 THAT WE HAVE HAD TO
TAKE ANOTHER BIG PAUSE. TODAY
WE ARE FACED WITH HARDER
DECISIONS. JUMP START IS
CONTINUING TO BE THE PARACHUTE
IT WAS INTENDED TO BE. ALLOWING
US TO FUND THE PRIORITIES
IDENTIFIED AT THE OUTSET PLUS
MENTAL HEALTH AS ADDED LAST
YEAR. EVERY YEAR WE HAVE HAD
JUMP START ON THE BOOKS WE HAVE
USED IT TO FUND THE FEN FUND
PROGRAMS. WE HAVE JUST ONCE MET
THE ORIGINAL PRIORITY FUNDING
LEVELS AND NEVER MET THE
FUNDING LEVELS PLUS INFLATION.
WE ARE STILL EXPERIENCING THESE
DOWNSTREAM ECONOMIC IMPACTS
FROM THE PANDEMIC AND FUNDING
PROGRAMS WAS A JUMP START. WAS
ONE OF JUMP START'S ORIGINAL
GOALS. WE HAVE TWO GENERAL
DECISIONS WE'LL HAVE TO MAKE
ABOUT JUMP START MOVING
FORWARD. WHICH IS HOW WILL WE
USE IT THIS YEAR AND HOW SHOULD
IT BE USED IN THE OUT YEARS
MOVING FORWARD? THESE ARE THE
TWO QUESTIONS WE ASK EVERY
YEAR. THIS IS NOT NEW. IF WE
WERE TO NOT USE JUMP START
FUNDS TO FILL IN THAT GENERAL
FUND DECREASES THAT WOULD BE
THE DEPARTURE FROM PAST
PRACTICE AND THE FIRST TIME WE
WOULD NOT BE USING JUMP START
IN THE GENERAL FUND SO I WANT
TO CENTER US THERE AS WE WERE
MOVING INTO THIS NEXT WEEK OF
HARDER DECISION. WHEN WE WERE
IN COUNCIL YESTERDAY, I HAD
HOPES FOR A BETTER PRESENTATION
TODAY. IN IS NOT ON DIRECTOR
DURAS. DIRECTOR DURAS AND
DIRECTOR NOBLE OUT PERFORMED
THE STATE WITH THEIR FORECAST.
YOUR FORECASTS WERE MORE
ACCURATE THAN THE STATE'S
FORECAST AND THAT WAS
IMPRESSIVE AND SO THAT IS WHY I
WILL BE COMFORTABLE TAKING YOUR
RECOMMENDATION TO USE THE
BASELINE SCENARIO FOR THE
OCTOBER 2024 REVENUE FORECAST.
I JUST WANTED TO SHARE THAT
BROADER CONTEXT WITH YOU
COLLEAGUES. WITH THAT, I SEE
COUNCIL PRESIDENT HAS HER HAND.
>> SO WHAT IS STRIKING.
>> YEAH.
>> SORRY. I'M GOING WITH VICE
CHAIR FIRST.
>> OH, I'M SORRY.
>> VICE CHAIR, OVER TO YOU.
>> THANK YOU CHAIR STRAUSS AND
COUNCIL PRESIDENT NELSON FOR
BEING PATIENT WITH ME. I THINK
THIS IS AN EXCELLENT WAY TO DO
THIS SO THE ENTIRE COUNCIL CAN
HEAR WHAT WE ARE HEARING. AND I
WANTED TO EXPRESS THE MAYOR'S
OFFICE INTENTION AND THE
MAYOR' INTENTION TO CONTINUE
TO BE GOOD PARTNERS WITH THE
CITY COUNCIL. THIS IS NOT GOOD
NEWS. JUST WANTED TO SAY THANK
YOU. AND I TO AGREE WITH THE
RECOMMENDATION HERE TO GO WITH
THE BASELINE. BUT WE CAN TAKE A
WHAT IS STRIKING TO ME IS THE
FIRST YEAR I WAS IN OFFICE IN
2022, IT WAS SHARPLY DECLINED
REVENUES. ON THE SALES TAX AND
ALSO THE BNO TAX. THOSE
DECLINES ARE ON GROSS RECEIPTS.
I ALWAYS LOOK AT OUR BUSINESSES
ACROSS THE CITY. LARGE, SMALL,
ET CETERA. THE GOOD NEWS IS
THAT WE ARE MORE IN CONTROL OF
THE FORCES THAT DO IMPACT BNO.
SO WE HAVE AN OPPORTUNITY IN
THIS BUDGET TO CONTINUE TO MAKE
DECISION TO TRY TO HELP THE
GROSS RECEIPTS GOING FORWARD.
BUT I AM ALWAYS KEENLY
INTERESTED LESS IN THE
CONSTRUCTION. I LOOK AT ALL THE
OTHER THINGS IMPACTING THE JOB
CREATOR INS OUR CITY. THANKS.
>> WELL SAID, DIRECTOR CARNELL?
>> THANK YOU FOR CREATING SPACE
HERE FOR US TO HAVE THIS
CONVERSATION WITH ALL THE
COUNCIL. I APPRECIATE THE WORK
THAT THE REVENUE FORECAST GROUP
HAS DONE. I APPRECIATE THE
VOLATILITY THEY ARE WORKING IN
AROUND THINGS CONSTANTLY MOVING
AND CHANGES. THE ENVIRONMENT IN
WHICH WE LIVE. I REMAIN
CONCERNED ABOUT SALES TAX AND
THE UP PACT WE ARE SEEING HERE.
I ALSO UNDERSTAND IT FROM
INDIVIDUAL HOUSEHOLDS HAVING TO
MAKE DECISIONS ON WHAT THEY
WILL AND WON'T DO. WE HAVE
ASPORTENS TO LEAD THE WAY FOR
THEM TO COME BACK DOWNTOWN AND
ENJOY THE EXPERIENCES THAT OUR
CITY HAS TO OFFER. I WILL, I'M
LEANING TOWARD THE BASELINE
SCENARIO. WITH THE VOLATILITY
THAT CONTINUES TO COME. WITH
THE ELECTION SEASON UPON US. I
WOULD ENCOURAGE THE REVENUE
FORECAST COUNCIL IN THE FUTURE
WITH THESE TO HELP US TO
UNDERSTAND WHAT PESSIMISTIC
VERSUS BASELINE REALLY MEANS
BECAUSE I THINK AT SOME POINT
IF THINGS CONTINUE TO BE AS
VOLATILE AS THEY ARE, WE SHOULD
HAVE A CONVERSATION ABOUT WHERE
DO WE GO FROM HERE. BUT AT THIS
POINT, WITH THE DATA THAT WE
HAVE AND THANK YOU FOR THE TEAM
THAT PULLED THIS TOGETHER. I
WILL LOOK AT THE BASELINE
SCENARIO.
>> I WILL JUST RIP OFF SOME
THINGS THE COUNCIL PRESIDENT
SHARED BECAUSE I FORGOT TO
SHARE THE GOOD NEWS WHICH IS
THAT REAL ESTATE EXCISE TAX HAS
TRADITIONALLY BEEN A TELLTALE
INDICATER IF WE ARE GOING INTO
A RECESSION OR NOT. THE TAX
WILL DROP A YEAR OR SO BEFORE
WE GO INTO THE RECESSION. SO
THAT WAS WHEN COUNCIL PRESIDENT
WAS REFERENCING THE DROP IN
OCTOBER OF 22. THAT WAS A BIG
JOLT FOR THOSE OF US PAYING
ATTENTION TO WHAT IS COMING
NEXT. SO WITH REAL ESTATE
EXCISE TAX COMING BACK, I THINK
DIRECTOR DURAS WHEN WE WERE
TALKING BEFORE THIS MEETING I
THINK GOT A LITTLE JOLTED BY
HOW EXCITED I GOT BECAUSE IT
WAS BECAUSE IT'S A TELLTALE.
IT IS A GOOD INDICATER OF A
BRIGHTER FUTURE. TO THE SALES
TAX, BEYOND JUST BUILDING
BUILDINGS, WEATHER THROUGH THE
PANDEMIC STORM, WE HAD CIVIC
PROJECTS. WE HAD THE WATERFRONT
AND THE WATERFRONT OVERLOOK
PASS. THE CONVENTION CENTER.
THE CLIMATE PLEDGE ARENA. WE
DON'T CURRENTLY HAVE A PUBLIC
PROJECT THAT IS GENERATING
SALES TAX IN THE SAME WAY RIGHT
NOW. AND THAT IS SOMETHING FOR
US TO IDENTIFY. GOOD NEWS ON
THE HORIZON IS THAT SOUND
TRANSIT WILL BE VOTING ON THE
WEST SEATTLE ALTERNATIVE. THE
NEXT TWO SOUND TRANSIT
EXTENSIONS ARE ALL HOLY WITHIN
THE CITY OF SEATTLE. WHICH IS
AN IMMENSE AMOUNT OF SALES TAX
REVENUE. IT IS A DECADE OFF. I
HAVE BEEN DEEP IN THE WEEDS
WITH SOUND TRANSIT. SO IF
ANYONE WANTS ANY BRIEFINGS ON
THAT, I AM HAPPY TO SHARE WITH
YOU EVERYTHING THERE IS TO KNOW
ABOUT SIXTH AVENUE BUSWAYS,
SIDEWALKS, AND HIGH VOLTAGE
POWER LINES. WITH THAT I WILL
OPEN IT UP TO MY COLLEAGUES ON
THE SELECT BUDGET COMMITTEE. IF
THERE ARE QUESTIONS ABOUT
ANYTHING IN THIS PRESENTATION.
>> COUNCILMEMBER RIVERA?
>> THANK YOU CHAIR AND THANK
YOU ALL FOR BEING HERE TODAY. I
AM YOU KNOW, IT IS
DISAPPOINTING TO HEAR THAT OUR
LOCAL ECONOMY IS NOT DOING AS
WELL AS THE NATIONAL ECONOMY.
IT IS THE INDUSTRIES WE RELY
UPON IN SEATTLE. I WILL SAY I
AGREE WITH COUNCIL PRESIDENT
NELSON IN THAT WE NEED TO AS
REREFLECT ON THIS CURRENT
BUDGET TO KEEP THAT IN MIND.
HOW ARE WE GOING TO MAKE
DECISIONS BASED ON THE REALITY
THAT IS AT THE LOCAL AND
REGIONAL LEVEL. I THINK THAT IS
REALLY IMPORTANT AND IT IS A
POINT I WANTED TO UNDERSCORE
BECAUSE THE PUBLIC IS LOOKING
AT THE NATIONAL ECONOMY AND HOW
THINGS ARE IMPROVING AND WE
NEED TO BE REALISTIC ABOUT WHAT
WE HAVE ON THE GROUND AND WE
NEED TO MAKE BUDGET DECISIONED
BASED ON THAT. THANK YOU.
>> THANK YOU COUNCILMEMBER
RIVERA. COLLEAGUES? ANY OTHER
QUESTIONS AT THIS TIME?
COUNCILMEMBER SAKA?
>> THANK YOU MR. CHAIR. ALSO I
APPRECIATE THE THOROUGHNESS OF
THIS PRESENTATION REALLY
COMPLEX STUFF. WE ARE ALL
DIGESTING IT IN REALTIME ON THE
FLY. WE HAVE THIS EMAIL
PROBABLY WHEN MANY OF US WERE
ON THE WAY TO WORK TO CITY HALL
TODAY. SO WE ARE DIGESTING,
UNDERSTANDING IN REALTIME WITH
MEMBERS OF THE PUBLIC.
TYPICALLY, WE GET THESE
BRIEFING MATERIALS IN ADVANCE.
WE ARE DOING THIS CONCURRENTLY
WITH ANYONE ELSE. DIFFICULT TO
HEAR. SOME OF THIS NEWS BUT WE
WILL EMERGE STRONGER FROM
WHEREVER WE LAND WITH RESPECT
TO ANY OF THESE POLICY
DECISIONS TEED UP NOW. SO I
UNDERSTAND THAT THE CONCLUSION
OR THE FORECAST OFFICE'S
RECOMMENDATION IS TO USE THE
DAIS LINE SCENARIO FOR THE
OCTOBER 2024 REVENUE FORECAST
WHAT HAPPENS? SO ASSUMING WE DO
THAT, AND ADOPT THAT
RECOMMENDATION, WHAT HAPPENS IF
FUTURECASTS AND ACTUAL REVENUES
RECEIVED TURN OUT TO BE MORE
ROSIER THAN THIS PROJECTION,
BETTER, MORE REVENUES. WHO
DECIDES WHAT TO DO WITH THAT
EXTRA FUNDING THAT WE ARE NOT
PLANNING FOR TODAY?
>> DIRECTOR NOBLE, I WILL PASS
THIS TO YOU.
>> SO, AS WE ENTER THE
BEGINNING OF NEXT YEAR, THE
CUTTING ON 2024 REVENUES AND
EXPENDITURES WILL BE COMPLETE
THROUGH THE END OF FEBRUARY. IT
TAKES THAT LONG TO WRAP UP THE
YEAR. WE WILL KNOW ABOUT THAT
IN TERMS OF EXPENDITURES LATE
FEBRUARY. THERE IS A NEW
REVENUE FORECAST PRODUCED IN
APRIL. USUALLY THE FIRST OR
SECOND WEEK OF APRIL. THAT'S
THE FIRST FORMAL REVENUE
FORECAST UPDATE. ON THE BASIS
OF THAT, THE TWO PIECES OF
INFORMATION WE HAVE A BETTER
SENSE OF WHERE WE ARE FOR 24
AND 25. IT WILL BE A FORECAST
FOR 26 AS WELL. SO THERE IS THE
COUNCIL TO WORK ON SUPPLEMENTAL
IN ORDER ORDINANCES. YOU WOULD
BE ABLE TO MAKE AMENDMENTS TO
THE 2025 BUDGET AND ANTICIPATE
CHANGES TO THE 2026 BUDGET.
LEGISLATION TO APPROPRIATE ANY
NET NEW MONEY IF YOU WILL CAN
BE INITIATED BY EITHER THE
MAYOR OR THE COUNCIL. WE HAVE
SET UP A CALENDAR IF YOU WILL
OF SUPPLEMENTALS. WE WOULDN'T
ACCEPT THEM MID YEAR. WOULD
COME FROM THE MAYOR'S OFFICE.
IN JUNE. BUT IF THERE WAS
DESIRE TO MOVE SOONER THAT
COULD BE POSSIBLE.
>> THANK YOU. SO IF DOWN THE
ROAD WE HAVE ANY SORT OF NET
NEW MONEY AS YOU POINTED, I
LIKE THAT FRAMING. THE PROPOSAL
FOR THAT MONEY CAN BE GENERATED
EITHER BY THE EXECUTIVE OR THE
COUNCIL. WOULD BECAUSE THIS IS
THE FIRST YEAR IN A WHILE,
SOUNDS LIKE WE ARE IN THIS
SITUATION. WOULD IT BE
POSSIBLE? I'M SURE IT WOULD,
FOR THE COUNCIL TO SET
DIRECTION IN TERMS OF A
RESOLUTION ON WHAT IF THAT
HAPPENS, WHAT WE WOULD LIKE TO
SEE THAT KIND OF FUNDING SPENT
WITH THE UNDERSTANDING IT IS NO
DECISIONS WILL BE MADE UNTIL
ANY PROPOSALS WHEN WE VOTE ON
IT?
>> I WILL JUMP IN AND NOT
RECOMMEND THAT OPTION. I'M
HAPPY TO EXPLAIN WHERE WE ARE
GOING. IT HAS BEEN A FUNCTION
THAT HAS BEEN WORKING WELL. I
AM ABSOLUTELY HERE FOR BUDGET
REFORM PROCESSES. BUT I WOULD
RECOMMEND AGAINST THAT AT THIS
TIME. I'M HAPPY TO DISCUSS
OFFLINE WITH YOU IN GREATER
DEPTH.
>> ANYTHING FURTHER?
>> GOOD TO GO.
>> THANK YOU. COUNCILMEMBER
MORALES?
>> THANK YOU FOR BEING HERE
EVERYONE AND WALKING US THROUGH
ALL OF THIS. I'M STILL TRYING
TO FORMULATE MY QUESTION TO SEE
WE ARE NOW FORECAST TO HAVE A
1% DECLINE OVER 25, POTENTIALLY
26. MY FIRST QUESTION IS AS THE
COUNCIL PREPARING THE BUDGET
FOR THESE YEARS, WOULD IT BE
BEST PRACTICE TO COMPENSATE FOR
THAT, THAT'S THE FIRST
QUESTION. I'M ASSUMEING THE
ANSWER IS QUESTION. IF WE USE
THE PAYROLL EXPENSE TAX TO
BACKSEAT FILL THE 1% REDUCTION.
WHAT DOES IT MEAN GIVEN THE
VOLATILITY OF THAT REVENUE
SOURCE, WHAT DOES THAT MEAN FOR
OUR ABILITY TO CONTINUE TO
PROVIDE SERVICES IF THERE IS
SOME DRAMATIC CHANGE IN THE
REVENUE OF THAT, IN THE INCOME
OF THAT SOURCE. I'M TRYING TO
UNDERSTAND IF WE START TO RELY
ON THAT SOURCE FOR GENERAL FUND
TO FUND BASIC SERVICES, WHAT
RISK DOES THAT CREATE FOR US?
>> TWO LEVELS OF THAT AT LEAST.
ONE IN THE IMMEDIATE TERM, IF
WE SAW A DECLINE IN REVENUES
RELATIVE TO THE FORECAST AGAIN.
I THINK YOU HAVE CORRECTLY
IDENTIFIED AMONG THE LARGEST
REVENUE. IT WOULD BE TO FALL ON
THE REVENUE STABILIZATION
ACCOUNT. ALSO KNOWN AS THE
RAINY DAY FUND. THE BALANCE IN
THE NEIGHBORHOOD OF 50, 60
MILLION. DEPENDING ON WHAT HAD
CAUSED THE DOWNTURN, YOU MIGHT
NOT WANT TO. YOU MIGHT WANT TO
SPEND DOWN THAT MULTIPLE YEARS.
AND IT IS BUILT SPECIFICALLY
FOR THAT. JUST TO SQUARE SOME
CIRCLES PERHAPS. THE RESERVE
RAINY DAY FUND. YOU ADD 30
MILLION TO THAT. YOU WOULD HAVE
90 MILLION OF TOTAL RESERVE
BETWEEN THE TWO. BEYOND THAT,
YOU WILL BE LEFT TO REDUCE
EITHER TO INCREASE REVENUES IN
SOME OTHER WAY OR TO REDUCE
EXPENDITURES IN THE LONGER OR
MEDIUM TO LONG RUN IF YOU WILL.
>> THANK YOU.
>> THANK YOU COUNCILMEMBER
MORALES. COLLEAGUES, OTHER
QUESTIONS AT THIS TIME? IF
THERE ARE NO FURTHER QUESTIONS
I WILL LEAD US INTO THE
ADOPTION OF THE OCTOBER
FORECAST. SORRYST LOST SOME OF
MY SLIDES. AT THIS TIME PER THE
ORDINANCE THAT CREATED THE
OFFICE OF ECONOMIC REVENUE AND
FORECASTS, IT IS THE ROLE OF
THE ECONOMIC AND REVENUE
FORECAST TO REVIEW AND APPROVE
THE FORECAST IN TERMS OF
APPROVING THIS FORECAST, SEEMS
AS IF WE CONCUR WITH THE
RECOMMENDATION OF THE FORECAST
SCENARIO. THERE IS NO FORMAL
VOTE REQUIRED. THE GOAL IS TO
REMOVE ANY RISK OF POLITICAL
INFLUENCE OVER THE FORECAST AND
RECEIVING RECOMMENDATIONS FROM
STAFF. COUNCILMEMBER SAKA SAID
THIS VERY WELL. THE PUBLIC
COUNCIL MEMBERS, MEMBERS OF THE
FORECAST, MEMBERS OF THE
EXCESSTIVE AND MAYOR'S OFFICE.
WE ARE ALL GETTING THIS AT THE
SAME TIME. THAT SAID, THE
FORECAST COUNCIL REPRESENTS AN
ELECTED LEADERSHIP OF
LEGISLATIVE AND EXECUTIVE
BRANCHES IT HAS BEEN
APPROPRIATE WE HAVE THE
AUTHORITY TO OVERRIDE SHOULD WE
JUDGE THIS MAKES SENSE. IT
WOULD REQUIRE THREE MEMBERS OF
THE ECONOMIC REVENUE FORECAST.
A VOTE APPROVING THAT SCENARIO.
THE BASELINE SCENARIO OF THE
OCTOBER 2024 FORECAST IS USED
AS THE BASIS FOR THE 25, 26
ADOPTED BUDGET. I WILL ASK
FORMALLY IF THERE ARE ANY
OBJECTIONS TO USING THIS. I AM
SEEING EVERYONE SHAKING THEIR
HEAD NO. INDICATING A NEGATIVE
RESPONSE. THIS IS THE FORMAL
STEP CALLED FOR UNDER THE
BYLAWS AS THE WAY WE REPORT OUR
APPROVAL OF THE FORECAST
RECOMMENDATIONS. JUST ARE THERE
ANY OBJECTIONS FOR THE COUNCIL
MEMBERS? HEARING NO OBJECTION,
I AM DIRECTING THE FORECAST
OFFICE TO RECORD IN THE MEETING
MINUTES THE ECONOMIC AND
REVENUE FORECAST COUNCIL'S
CONCURRENCE WITH THE
RECOMMENDATION TO USE THE
BASELINE SCENARIO FOR THE
OCTOBER FORECAST. WITH THAT, WE
HAVE REACHED THE FORMAL AGENDA
FOR THE FORECAST COUNCIL
MEETING. IF THERE ARE NO
FURTHER QUESTIONS, THE ECONOMIC
AND REVENUE FORECAST COUNCIL
WILL BE ADJOURNED. BUT DON'T
GO ANYWHERE. BECAUSE WE STILL
HAVE THE REST OF THIS SELECT
BUDGET COMMITTEE MEETING.
HEARING NO OBJECTIONS, THE
ECONOMIC REVENUE FORECAST
COUNCIL IS ADJOURNED.
COLLEAGUES, WE HAVE BEEN HERE
FOR QUITE SOME TIME. IT IS
11:49 A.M. AS WE HAVE A LOT OF
PRESENTERS THAT WILL BE
REMOVING OFF OF THE DAIS AND
MOVING BACK INTO THE COMMITTEE
TABLE, I AM GOING TO ASK FOR US
TO BE IN AN 11-MINUTE RECESS. I
WAS GOING TO START WITH FIVE.
BUT LET'S START AT NOON. WE'LL
GO FROM NOON ON WARD. SO I'M
HOPING IT WILL NOT TAKE UNTIL
4:00. BUT WE DO HAVE TWO SETS
OF PRESENTATIONS. THE
DEPARTMENT AND CENTRAL STAFF
ANALYSIS. SO WITH THAT, IF
THERE IS NO OBJECTION, THE
SELECT BUDGET COMMITTEE MEETING
WILL BE IN RECESS UNTIL NOON.
THANK YOU.
>>> THANK YOU, WELCOME. THE
OCTOBER 22, SELECT BUDGET
COMMITTEE WILL COME BACK TO
ORDER. IT IS 12:01 P.M., I'M
DAN STRAUSS, CHAIR OF THE
SELECT COMMITTEE. WILL CLERK
PLEASE CALL THE ROLL?
>> COUNCILMEMBER KETTLE?
>> HERE.
>> COUNCILMEMBER MORALES?
EXCUSE ME. COUNCILMEMBER SAKA?
>> HERE.
>> COUNCILMEMBER WU?
>> PRESENT.
>> HOLLINGSWORTH?
>> HERE.
>> AND CHAIR STRAUSS?
>> PRESENT.
>> FIVE PRESENT.
>> I'LL LET EVERYONE KNOW WHEN
ANYONE ELSE JOINS, WE'RE JUST
TAKING A QUICK RECESS IN
BETWEEN PRESENTATIONS. WE HAVE
CHAIR RIVERA WITH US NOW.
COLLEAGUES, THIS IS ANOTHER
ABNORMAL PRESENTATION. THIS IS
ABNORMAL, TUESDAY, THE 22,
WHERE WE ARE NOW GOING TO HAVE
SDOT COME BACK AND PRESENT TO
US A PRESENTATION OF WHAT WOULD
YOUR BUDGET LOOK LIKE SHOULD
THE LEVY PASS. COLLEAGUES, I
NEED US TO STAY COMPLETELY
FOCUSED ON THE BUDGET BEFORE US
AND NOT SPEAK ABOUT THE LEVY IN
BROADER TERMS BECAUSE IT IS
BEFORE THE VOTERS AT THE
MOMENT. AFTER SDOT'S
PRESENTATION, WE HAVE DIRECTOR
EATER AT THE TABLE. AND SO THIS
IS GOING BACK TO WEEK ONE OF
BUDGET WITH SDOT. THEY WILL
HAVE THEIR PRESENTATION, AND
WHO IS HERE FROM CENTRAL STAFF
TO BRING US BACK, WHERE OUR
POLICY CONSIDERATIONS THAT ARE
ON THE TABLE. WITH THAT, I'LL
TURN IT OVER TO DIRECTOR GREG
SPOTTS. THANK YOU.
>> THANK YOU, CHAIR STRAUSS.
I'M GREG SPOTTS, DIRECTOR OF
THE SEATTLE DEPARTMENT OF
TRANSPORTATION, JOINED BY CHRIS
GODWIN AND SENIOR DEPUTY
DIRECTOR, FRANCISCA STEFAN. AND
HERE WE ARE, WE DO HAVE SOME
UPBEAT MATERIAL TO PRESENT. WE
ARE PRESENTING WHAT SORT OF
SPENDING AUTHORITY IN POSITIONS
WE WOULD NEED IN THE EVENT THE
VOTERS PASS THE TRANSPORTATION
LEVY. TODAY, WE'RE JUST GOING
TO PROVIDE A HIGH-LEVEL
SUMMARY. THERE'S A LOT OF
DETAILS ON OUR SLIDES, SO WE'RE
GOING TO MOVE RELATIVELY
QUICKLY THROUGH THE MATERIAL,
NEXT SLIDE, PLEASE. JUST TO
ORIENT EVERYONE, WE ARE GOING
TO -- OKAY, I THOUGHT WE WOULD
GO TO THE ONE AFTER THAT. WE'LL
PRESENT A HIGH LEVEL SUMMARY OF
WHAT BUDGET AMENDMENT IS
PROPOSED IN THE EVENT THE LEVY
PASSES. AND THEN WE'LL PREPARE
FOR IMPLEMENTATION IN JANUARY.
AND SO WHERE WE ARE ALONG OUR
JOURNEY. IN J THEY WOULD PUT
THE LEVY AND PASS ON THE
RESOLUTION. AND RIGHT AFTER
THAT, WE STOOD UP THE TEAM IN
SDOT TO BE PREPARING TO HIT
THAT GROUND RUNNING IN JANUARY
SHOULD THE VOTERS PASS THE
LEVY. BUT ONE OF THE FINDINGS
OF THE COMMITTEE FOR THE
CURRENT LEVY WAS THAT SDOT GOT
OFF TO A BIT OF A SLOW START
WHEN THAT PASSED. WE HAVE BEEN
WORKING VERY HARD TO MAKE SURE
WE GET OFF TO A BETTER START
SHOULD WE BE LUCKY ENOUGH FOR
THEM TO PASS THE LEVY. AND
TODAY, WE HAVE A PACKAGE OF
AMENDMENTS AND CAPITAL PROGRAM
SPEND PLAN FOR YOUR
CONSIDERATION. WE'RE ALSO
PROVIDING TODAY ANOTHER
INFORMATION PACKAGE THAT WAS
REQUESTED IN THE RESOLUTION
PERTAINING TO HOW WE'RE
GEARING UP TO BEGIN ON THREE
PROGRAMS THAT WERE OF
PARTICULAR INTEREST TO THE
COUNCIL. AND WITH THAT, I'LL
PASS IT TO CHRIS GODWIN.
>> THANK YOU. GOOD AFTERNOON.
I'M THE FINANCE MANAGER FOR
THE SEATTLE DEPARTMENT OF
TRANSPORTATION. WE'RE NOW
GOING TO DISCUSS THE FINANCIAL
COMPONENT OF OUR PROPOSAL. AND
SHOWING HOW IT ALIGNS WITH
ATTACHMENT A THAT COUNCIL
APPROVED IN JULY. IT WILL ADD
TO THE CURRENT LAW BUDGET AND
WILL ADD $178 MILLION IN 2025
AND $193 MILLION IN 2026
SPECIFICALLY FOR THE
TRANSPORTATION LEVY. ALL THE
NUMBERS WE WILL BE DISCUSSING
TODAY IS WHAT COUNCIL PROVIDED.
OKAY. WE WILL START WITH
REVENUES AND EXPENDITURES TO
SHOW MORE THAN ANYTHING THAT
OUR BUDGET WILL BE TAILORED AS
YOU MAY RECALL IT WILL COMPRISE
OF LARGE SPECIFIC PROJECTS LIKE
STRUCTURAL IMPROVEMENTS TO
SPECIFIC BRIDGES AND ALSO
PROBLEMATIC BUDGETS LIKE VISION
ZERO. THE PROJECTION SHOWS HOW
IF YOU LOOK AT THE BOTTOM LINE,
THE TOTAL PROJECTION BY YEAR
WILL JUMP UP AND DOWN, BUT NAY
WILL MAKE SURE THEY STAY WITHIN
THE REVENUES THAT ARE
COLLECTED. YOU'LL SEE THAT AT
THE TOP OF THIS. AND A COUPLE
OF OTHER ITEMS TO POINT OUT ON
THIS AND WE WILL SEE THEM IN A
MOMENT. THE LAIN ITEM ON HERE
IS FRONT LOADED. AND THEN THE
SAFETY PORTION IS ALSO
REFLECTING OUR COMMITMENT TO
NEW SIDEWALKS. OKAY, SO WE'RE
GOING TO GO THROUGH EACH OF THE
PROGRAM AREAS TO DISCUSS THE
INCREASE IN POSITIONS, WHICH IS
ALSO GOING TO BE APPROVED BY
THE COUNCIL. SDOT IS TAKING A
THREE-PRONGED APPROACH
INCLUDING RESOURCING CURRENTLY
FILLED POSITIONS THAT WILL
TRANSITION TO THE NEW LEVY AS
WE COMPLETE WORK ON THE
EXISTING LEVY. FILLING CURRENT
VACANCIES TO STAFF UP TO ENSURE
WE COULD HIT THE GROUND
RUNNING, AND ALSO REQUESTING
ADDITIONAL POSITIONS IN '25.
AND OUR INTENT TO ASK FOR
POSITIONS IN '26. THIS IS ALL
TAKING SOME LESSONS LEARNED IN
THE CURRENT --
>> EXCUSE ME.
>> CHRIS, YOU'RE SPEAKING VERY
FAST, SO I'M GOING TO SAY SLOW
DOWN A LITTLE BIT, AND IF YOU
CAN BRING THE MICROPHONE CLOSER
TO YOUR MOUTH. AND WHERE I
REMIND EVERYONE TO BRING THAT
MICROPHONE.
>> AND THESE ARE ESSENTIAL FOR
THE TRANSPORTATION LEVY. AND AS
FAR AS THE DELIVERABLES, THERE
SHOULD BE NOTHING ON THAT
COLUMN, WHICH IS SURPRISING AND
WHAT WE WOULD HAVE IN
ATTACHMENT A. FOR VISION ZERO,
WE ARE PROPOSING TO ADD $16
MILLION IN 2025. AND THIS WILL
INCLUDE NEW PROGRAMS FOR SAFETY
PARTNERSHIP PROGRAMS AND THE
TRAFFIC IMPROVEMENTS. THE $16
MILLION INCREASE WILL REPRESENT
THE GROWTH. WE ANTICIPATE
NEEDING 17.6 POSITIONS. 13.7 OF
THOSE POSITIONS WOULD BE IN
2025.
>> AND CHRIS, JUST TO CLARIFY.
YOU REFERENCED ATTACHMENT A
JUST A MOMENT AGO. CAN YOU
CLARIFY, IS THAT ATTACHMENT A?
>> TO THE ORDINANCE APPROVED IN
JULY.
>> FOR THE LEVY?
>> YES.
>> NOT ATTACHMENT A TO ANY OF
THESE THINGS?
>> CORRECT.
>> THIS IS JUST ME SAYING WHAT
I ALREADY KNOW. AND THIS IS THE
DOCUMENT THAT WE ALL WENT OVER
AND OVER AND OVER AND OVER
AGAIN.
>> RIGHT.
>> AND WHAT WE'RE SEEING IS A
SUMMARY.
>> AND NOT TO BE CONFUSED WITH
THE BUDGET.
>> THAT'S WHY THE ASKED,
THANKS.
>> WE ARE PROPOSING TO ADD $206
MILLION IN THE OEM BUDGET. THIS
INCLUDES $45 MILLION IN 2025
AND $37 MILLION IN 2026. THIS
IS WHERE WE BUDGET FOR MOST OF
OUR LARGE PAVING PROJECTS. AND
IT WILL INCLUDE THE POTHOLE
WORK. IT WILL INCREASE OUR
BUDGET WITH THE NEW POSITIONS
IN 2025.
>> THANK YOU.
>> PLEASE. AND SORRY, I SHOULD
OFFER SAKA IS OVERSEEING THE
CHAIR OF THIS DEPARTMENT. AND
THEN COUNCILMEMBER RIVERA, I'LL
CALL ON YOU.
>> THANK YOU, MR. CHAIR. NO
QUESTIONS OR COMMENTS FROM MY
PERSPECTIVE AT THIS TIME. AND
YOU KNOW, YEAH.
>> THANK YOU. COUNCILMEMBER
RIVERA?
>> THANK YOU, CHAIR. YOU ARE
TALKING ABOUT $43 MILLION, BUT
I DON'T SEE IT HERE. IS THAT
OF THE MILLION THAT YOU'RE
TALKING ABOUT HERE, YOU KNOW,
WHERE THEY MEET THESE PIECES?
AND IT IS F NOW YOU'RE THROWING
FIGURES OUT THAT I'M NOT
SEEING ON THIS CHART?
>> YES. THE $43 MILLION IS THE
FIRST YEAR OF THAT $112
MILLION. SORRY, THE $246
MILLION, THAT'S FOR STREET
MAINTENANCE. THERE IS AN
ATTACHMENT THAT'S NOT IN OUR
PRESENTATION, BUT SENT TO YOUR
COUNCIL CENTRAL STAFF. AND THEY
HAVE ATTACHMENT A. IT INCLUDES
THE FTE REQUEST AND THE BUDGET
REQUEST BY YEAR, SO YOU CAN SEE
IT BROKEN OUT. IT'S A SUMMARY
THAT WILL SHOW WHAT IS ACTUALLY
IN THE BUDGET ITSELF.
>> IF YOU LOOK AT ATTACHMENT
ONE, THEY WILL HAVE THAT BROKEN
OUT.
>> THANK YOU.
>> AND THIS IS WHY WE TYPICALLY
SPLIT THE PRESENTATIONS, BUT
HERE WE ARE. BACK TO YOU,
CHRIS.
>> MOVING ON TO BRIDGES AND
STRUCTURES. WE'RE PROPOSING TO
AT $161 MILLION IN THE BUDGET.
THIS INCLUDES $19 MILLION IN
2025. IT INCLUDES SPECIFIC
PROJECTS THAT WERE CALLED OUT
IN ATTACHMENT A, AS WELL AS OUR
BRIDGE PLANNING WORK AND
ONGOING WORK ON PRESERVATION.
THEY REPRESENT IS 80% INCREASE
OVER THE CURRENT LAW BUDGET.
AND WITH 17.2 NEW POSITIONS
COMING UP IN 2025. WE'RE
PROPOSING TO ADD $126 MILLION
IN THE CIP AND $14 MILLION IN
2026. INCLUDING OUR WORK ON
TRANSIT LINE, THE IMPROVEMENTS,
ACCESS TO LIGHT RAIL, AND
TRANSIT PASSENGER SAFETY. THE
$13 MILLION INCREASE IN 2025
WILL REPRESENT THE 20%
INCREASE, AND WE NEED THOSE
POSITIONS WITH 3.1 OF THOSE IN
2025.
>> AND ONE MORE TIME. CAN YOU
PULL THAT DOWN TOWARDS YOU?
BECAUSE YOU WOULD LOOK DOWN AT
YOUR PAPER AS WE WOULD LOSE IT.
I'VE BEEN LOOKING AT YOU. AND
WE WILL KEEP TICKING ON.
>> MOVING ON TO PEDESTRIAN
SAFETY. AND WE WOULD PROPOSE TO
ADD $165 MILLION IN THE SIX
YEAR CIP INCLUDING $31 MILLION
IN 2025 AND 2026. THIS PROGRAM
AREA WILL INCLUDE THE NEW
SIDEWALK AND THE BUDGET
REFLECTS THE FRONT LOADING OF
THE SIDEWALKS IN THE FIRST FOUR
YEARS WITH TAPERINGS STARTING
IN 2031. THE $31 MILLION
INCREASE IN 2025 WILL REPRESENT
166% INCREASE. WE ANTICIPATE
NEEDING 37 NEW POSITIONS WITH
17.6 NEW POSITIONS IN 2025.
THIS IS A PART OF THE BUDGET
FOR CREWS AND WHERE THERE ARE
HIGHER ADS FOR CREWS TO HELP
MAINTAIN AND BUILD SIDEWALKS.
WE PROPOSE TO ADD $41 MILLION
TO THE OEM BUDGET. THIS AREA
INCLUDES MAINTENANCE AND
IMPROVEMENTS FOR SIGNS AND ADDS
FUNDING THAT WILL KEEP THIS
OPERATIONAL 24 HOURS A DAY.
REPRESENTING A 65% GROWTH AND
WE ANTICIPATE NEEDING 17.2
POSITIONS WITH 3.4 NEW
POSITIONS IN 2025. OKAY, I'M
GOING TO KEEP ON GOING THEN.
AND WE PROPOSE TO ADD $110
MILLION WITH $33 MILLION IN
2026. INCLUDING MAINTENANCE,
THE BUDGET WILL JUMP FROM 2025
TO 2026 BECAUSE OF THE
REALIGNMENT OF THE TRAIL. THE
$17 MILLION INCREASE REPRESENTS
A 308% GROWTH. THIS MAY SEEM
LIKE A SIGNIFICANT INCREASE IN
BUDGET. HOWEVER, IT WAS HEAVILY
IMPACTED BY THE LOSS OF THE
CURRENT LEVY AND STARTING FROM
A LOWER BASE THAN USUAL. WE
ANTICIPATE NEEDING 9.1 NEW
POSITIONS OVER THE BIANNUAL. I
SKIPPED ONE, I THINK. CLIMATE
RESILIENCY.
>> PEOPLE STREETS.
>> DID I SKIP ONE AGAIN? WE
PROPOSE TO $47 MILL
THE WITH $7 MILLION IN
2026. BECAUSE THIS IS A NEW
PROGRAM AREA WITH WORK THAT
MIGHT OCCUR THROUGH DIFFERENT
PROJECTS, THIS IS A SOMEWHAT
UNCARTED TERRITORY FOR US OR
PULLS FROM OTHER PROJECTS. THIS
WILL INCLUDE OUR WORK ON
DOWNTOWN INVESTMENTS, OTHER
COLLOCATIONS IN ADVANCE OF FIFA
AND OTHER MAJOR EVENTS. AND
WITH NEW POSITIONS COMING IN
2025.
>> I'M NOT SEEING ANY
QUESTIONS, SO KEEP ON GOING.
>> WE PROPOSE TO ADD $52
MILLION IN THE OEM BUDGET WITH
$8 MILLION IN 2016. THE
LALLINGS NEIGHBORHOODS AND
CLIMATE WORK. THEY REPRESENT A
GROWTH OVER THE CURRENT LAW
BUDGET TO SUPPORT THE WORK WITH
NEW POSITIONS COMING IN 2025.
AND WE PROPOSE TO ADD $35
MILLION IN THE CIP WITH FOUR
MILLION IN '25 AND '26,
INCLUDING THE INVESTMENTS,
SAFETY IMPROVEMENTS TO I-90,
I-5. THE $4 MILLION INCREASE
REPRESENTS 234% GROWTH OVER THE
CURRENT LAW BUDGET, AND WE
ANTICIPATE NEEDING 14.8 NEW
POSITIONS. FOR GOOD GOVERNMENT
AND EQUITABLE IMPLEMENTATION,
WE'VE PROPOSED TO ADD $5.1
MILLION WITH $2 MILLION IN 2025
AND $3 MILLION IN 2026. THIS IS
ANOTHER EXAMPLE WHEN WE CANNOT
PROVIDE A COMPARISON WITH THE
BASE BUDGET. THE MAJORITY OF
THE FUNDING HERE IS FOR THE
TRANSPORTATION FUNDING TASK
FORCE. SOME OF THE OTHER
INVESTMENTS. THERE IS NOT A
COMPARABLE BASE. WE DO
ANTICIPATE NEEDING 0.2 FTE
STAFF TIME TO SUPPORT THE WORK
STARTING IN 2025. AND SO THAT
IS THE EXTENT OF THE SUMMARY
THAT ARE IN THE PACKAGE BEFORE
YOU, AND I WILL NOW BAR ANY
QUESTIONS AND PASS IT TO TALK
ABOUT THE APPROACH.
>> AND I WILL TEE THAT UP.
>> AND WE ARE CURRENTLY ON
SLIDE 12 OF24, SO WE ARE
HALFWAY THROUGH. AND CHAIR OF
THE COMMITTEE OVERSEEING THE
DEPARTMENT. DO YOU WANT TO MAKE
COMMENTS NOW?
>> I WILL WAIT UNTIL THE VERY
END. ANY QUESTIONS FROM WHAT WE
HAVE SEEN? TAKE IT AWAY,
DIRECTOR SPOTTS.
>> THANK YOU, AND I WANT TO
THANK THE MAYOR'S OFFICE AS WE
HAVE BEEN WORKING CLOSELY
TOGETHER. IT IS QUITE A LOT OF
WORK ON HOW YOU DO THE
SPENDING, AND SO NOW WE WILL
HAVE AN UPDATE ON THE
READINESS. I JUST WANT TO KNOW
THERE IS A DIFFERENCE BETWEEN
GETTING READY, STARTING,
LIFTING UP PROGRAMS IF THEY
PASS AND WHEN WE WOULD HAVE THE
RESOURCES TO CHARGE STAFF TIME
TO. SO WE ARE DOING THE MAX
NUMB THAT IS POSSIBLE AND THE
PREPARATORY PHASE. A LOT MORE
DETAIL WILL COME TOGETHER WHEN
WE ACTUALLY LAUNCH. AND SO WITH
THAT, I'LL PASS IT OVER TO
FRANCISCA.
>> GREAT, THANK YOU, GREG.
THANK YOU, CHRIS FOR A DETAILED
PRESENTATION ON THE NUMBERS.
YOU KNOW, WITH THIS SECTION, IT
WILL TALK MORE ABOUT WHAT'S
BEHIND IT. HOW DID WE GET TO
THOSE NUMBERS? YOU DID RECEIVE
FROM US A DOCUMENT THAT WAS
REQUESTED THROUGH THE
RESOLUTION THAT ADOPTED THE
LEVY THAT YOU HAD BEEN IN
PARALLEL WITH THE ORDINANCE.
AND IT IS THE HIGH-LEVELED
APPROACH. IT'S GOT A LOT OF
DETAIL IN IT WHEN YOU HAVE
ADDITIONAL QUESTIONS AND THAT I
RECOMMEND TAKING A LOOK AT IT.
WHAT WE WANTED TO TALK ABOUT
TODAY IS OUR READINESS APPROACH
AND HOW IT HAS BEEN GUIDED BY
THE PRIORITIES. AND WE HAVE
DONE RESOURCING, WHERE WE
TALKED INTO KNOWLEDGE
THROUGHOUT TO SOURCE WHAT WE
HAVE GOTTEN WITH A LOT MORE TO
GO. BUT THEY HAVE BEEN ABLE TO
HELP US, MANY OF WHICH THEY
HAVE TALKED ABOUT, WHICH IS
VERY IMPORTANT TO BRING TO LIFE
EARLY IN THE LEVY. AS WE MOVE
FORWARD, WE'LL BE WORKING WITH
YOU AND ALIGNING WITH CURRENT
CHALLENGES AND OPPORTUNITIES.
THIS WORK WILL FALL, 30% OF
THEIR BUDGET. THIS WILL FALL
WITHIN THE BROADER PRIORITIES
AND THE OPPORTUNITIES THAT WE
ARE ALL EMBRACING, INCLUDING
THE WORLD MEN'S CUP THAT IS
COMING OUT OF US FOR SOUND
TRANSIT. HOW DO THEY FIT
TOGETHER A PART OF WHAT WE WILL
BE DOING? WE HAVE AN EYE
TOWARDS STANDING UP THE
MEASURES THAT YOU WOULD ALL
DEFINE WITH THE LEVY OVERSIGHT
COMMITTEE, AS WELL AS THE
FUNDING TASK FORCE. THEY'RE
ALL PART OF THE OVERALL
APPROACH. ONE OF THE THINGS
THAT WE HAVE BEEN DOING AS FAR
OF THIS WORK AND SEEING THE
GOOD VALUABLE INFORMATION AT
HAND TODAY, AS WE HAVE TALKED
ABOUT THE ORDINANCE. WE HAVE
NOT TALKED A WHOLE LOT ABOUT
THE FACT THAT WE'VE HAD THE
PLAN AND COMMUNITY INPUT AND
REQUEST THAT WE WOULD GET FROM
THE PUBLIC. SO ONE OF THE
THINGS WE'VE BEEN LOOKING AT
IS HOW TO TAKE ADVANTAGE OF THE
TENS OF THOUSANDS OF PEOPLE WHO
PARTICIPATED AND ALL THE THINGS
THAT WE HAVE LEARNED THROUGH
THAT PROCESS THAT COULD BE
MAKING THE RIGHT INVESTMENT.
AND IN ONE OF THE THINGS THAT
WILL DRIVE THEIR WORK IS WHAT
ARE THE THINGS THAT ARE KEEPING
PEOPLE MOVING FROM POINT A TO
POINT B, AND HOW DO WE MOVE
THEM THROUGH THE MULTIPLE MODES
AND AS EFFICIENTLY AS POSSIBLE
THROUGH THE NETWORK. WITH THAT
EYE TOWARDS OUR COMMITMENT TO
EQUITABLE INVESTMENT AND WHAT
ARE THE PARTS OF TOWN TO MAKE
INVESTMENTS IN OUR INVESTED
COMMUNITIES. LAST, BUT NOT
LEAST, WE REALLY NEED TO BE
TALKING ABOUT LEVERAGING THESE
FUNDS. IT'S IMPORTANT. MANY OF
THESE LARGE PROJECTS ARE GOOD
CONTENDERS FOR STATE AND
FEDERAL FUNDING. HOW CAN WE
CONSIDER THE TIMING OF THESE
PROJECTS AND BRINGING IN
ADDITIONAL FUNDS TO HELP
LEVERAGE THE DOLLARS? AND SO IN
TERMS OF HIGHLIGHTS. ONE OF THE
THINGS THAT I WANT TO
UNDERSCORE, THERE ARE PROJECTS
THAT HAVE BEEN CALLED OUT. AS
YOU CAN TELL, THEY WILL HAVE
THAT ATTACHMENT, THE STATUS, SO
WE WILL GO BACK TO IT A LOT,
AND AS THEY RELATE TO MAJOR
MAINTENANCE AND PLANNING, THERE
ARE CORRIDORS THAT ARE CALLED
OUT THERE THAT WE WERE
PRIORITIZING AS WE DID THIS
RESOURCING WORK TO FIGURE IT
OUT. AND THEY ARE HELPING TO
SHAPE THE MAJOR CONTOURS OF HOW
THEY LOOK AHEAD AND THEY ARE
SIMILAR AND THEY WILL TAKE TIME
TO DESIGN AND SCOPE AND
LEVERAGE FOR OUTSIDE FUNDS AND
THAT IT HAS BEEN FOLDED INTO
WHAT THEY PRESENTED AND HOW
WILL WE SEQUENCE THOSE
PROJECTS, AND THAT WE NEED TO
START GETTING GOING. PAVING
SOME WORK AS WELL AS EAST
MARGINAL WAYS. THESE ARE THINGS
THAT WE WOULD START WORKING ON,
WHERE WE GOT AN ADDITION FALL
FACTOR THERE, WHICH IS WE WANT
TO HAVE THAT DONE AS WELL. AND
WHILE WE WANT TO LAUNCH THE
BRIDGES, AND WE WANT TO ISSUE
THE RFPs AND GET GOING ON THE
ANALYSIS FOR THE REPLACEMENT
CANDIDATE TO HAVE ALL THIS WORK
AS PART OF THE TRANSPORTATION
FUNDING TASK FORCE
CONVERSATION. AND NOT TO
ECLIPSE, NOT TO HAVE THESE
LARGE PROJECTS ECLIPSE MANY OF
THE VALUABLE SMALLER PROJECTS
THAT WE DO. I WANT TO
ACKNOWLEDGE WE ALSO HAVE BEEN
LOOKING AT WAYS IN WHICH WE'RE
ADVANCING THE SAFETY, THE WORK
RELATED TO VISION ZERO THAT ARE
BEING SCOPED AND THE COMMUNITY
INPUT. THAT WORK IS A
SIGNIFICANT PORTION OF THIS AS
WELL AS OUR OPERATIONS IN
FREIGHT INVESTMENTS. I WILL
JUST PAUSE FOR A SECOND AND
HIGHLIGHT OUR WORK BECAUSE THEY
ILLUMINATE THE CORE FACTORS
THAT ARE AT PLAY WITH THE WORK
WE HAVE BEEN DOING AND TO BUILD
SIDEWALKS, SO HOW ARE WE GOING
TO DO THAT? AND WHAT YOU SEE IS
SOME RESOURCING BOTH IN STAFF
AND CONSULTANT WORK. WE NEED TO
DO THE WALKS WITH THE
COMMUNITIES TO LOOK AT
CONNECTIVITY. TO LOOK AT THE
CONSTRUCTION FEASIBILITY, WHERE
WE WILL NEED TO DO THIS DEEP
WORK RIGHT AWAY. THAT'S ONE OF
THE THINGS THAT WE HAVE BEEN
DOING IS WHEN WE COULD GET OUT
OF THE COMMUNITY, AND WHERE
WOULD WE FOCUS FIRST? AND THAT
IS A KEY PART OF IT, WHERE IT
IS A GOOD EXAMPLE OF HOW WE
HAVE BEEN TRYING TO PREPARE AND
NOT GET OVER IT AS IT RELATES
TO THE FUNDING AVAILABLE. SO
DOING THAT WORK.
>> AND JUST AS YOU'RE MOVING
INTO THE NEXT TWO SLIDES, THERE
IS A SLIDE FOR NORTH SEATTLE.
AND HERE WE GO WITH THAT ENTIRE
CITY STARTING IN NORTH SEATTLE.
[ LAUGHTER ]
>> YES. AND YOU KNOW, WE REALLY
COULDN'T RESIST JUST SHOWING
YOU SOME OF THESE HIGHLIGHTS
FOR 2025. THESE ARE 2025
HIGHLIGHTS. LIKE WE'VE SAID,
THIS IS NOT THE FULL LIST. THIS
IS NOT FULLY DEFINED. WE LOOK
FORWARD TO COMING BACK TO YOU
IN JANUARY TO TALK MORE ABOUT
THE IMPLEMENTATION PLAN. BUT WE
ALSO KNOW PEOPLE, THEY WANT TO
HAVE A SENSE OF WHAT'S COMING
SOON. SO AS I'VE TALKED ABOUT,
WE HAVE THE HIGHLIGHTS, WHERE
WE IDENTIFIED THE AREAS OF
NORTHGATE AND AS KEY PARTS OF
NORTH SEATTLE, WHERE PEOPLE
WILL BE ENGAGING WITH US ON THE
SAFETY PROJECTS AND THEIR
PLANNING WITH A GOAL THAT WILL
BE A PREFERRED ALTERNATIVE,
WHERE THERE WILL BE PROJECTS
ALL OVER. AND TO MAKE
IMPROVEMENTS THAT ARE MEANING
FOR FOR THOSE COMING AND GOING.
AND IN ADDITION TO SOME OF THE
WORK THAT WE HAVE TALKED ABOUT,
THERE ARE VERY SPECIFIC WORK IN
NORTH SEATTLE, AS WELL AS IN
57. SO WE HAVE BEEN ABLE TO
IDENTIFY WITH PRIOR WORK IN
2025. AND THIS IS NOT MEANT TO
BE EXHAUSTIVE, BUT FOR YOU TO
GET A SENSE OF SOME OF THE
CONTOURS OF WHAT YOU COULD
EXPECT TO SEE IN 2025. BEING
READY FOR THE MEN'S WORLD CUP
AND DOWNTOWN AND WHAT DOES IT
MEAN TO BE DOING THE
IMPROVEMENTS IN THE SQUARE, AND
WE HAVE IDENTIFIED AREAS NEAR
THE MOUNT BAKER STATION,
RAINIER BEACH, AS WELL AS
HIGHLAND PARK. THESE ARE AREAS
THAT WE ARE STARTING TO TRY TO
DO A ROUGH CALENDAR, WHEN WE
WOULD START DOING THOSE WALKS.
AGAIN, WITH THE SAFE ROUTES TO
SCHOOL. THESE ARE GOING TO BE
THE ONES THAT WILL BE PEPPERED
THROUGHOUT AREA, WORKING WITH
NEIGHBORHOODS AND COMMUNITIES.
WITH BRIDGES, WE HAVE AN
INTERESTING PROJECT THAT WILL
BE CARRYING FORWARD FROM THE
MOVE SEATTLE LEVY. AND THAT
BRIDGE IS ONE THAT WE HAD
IDENTIFIED THROUGH THE
STRUCTURAL UPGRADES. THIS IS
ONE WHERE WE WERE ABLE TO
AFFORD IT AND SO IF THAT DOES
PASS, WE ARE LOOKING FORWARD TO
BE ABLE TO START RIGHT AWAY TO
ADD AND GET IT STRENGTHENED.
AGAIN, THERE'S A LOT OF WORK
AHEAD OF US, WHERE WE HAVE NOT
COST ESTIMATED ANY OF THIS. IT
WILL INVOLVE MORE DETAILED COST
ESTIMATING, AS WELL AS
CONTINUING TO WORK WITH THE
COMMUNITY. AND THERE ARE SOME
PIECES THAT ARE STARTING TO
TAKE SHAPE.
>> AND IF YOU CAN GIVE ME THE
TRIVIA AS SHOWN IN THAT PHOTO,
THAT WOULD BE HELPFUL.
>> I'M NOT SURE WHAT THAT IS.
WHAT IS IT?
>> I WAS ALSO SCOLDED. THANK
YOU. IT'S THE GRAY BUILDING IN
THE BACKGROUND THAT IS NEXT TO
THE FORMER RECORD, WHICH IS
STILL A RECORDING STUDIO THAT
THEY WOULD USE TO RECORD ALL
TEAR MUSIC.
>> THAT IS AWE? AND THANK YOU
FOR SHARING THAT. JUST QUICKLY,
A PART OF WHY WE NEED TO ADD
THE POSITIONS IS THE PROPOSED
NEW LEVY THAT IS QUITE A BIT
LARGER THAN THE EXISTING LEVY,
THAT WILL BRING IN $100 MILLION
A YEAR. THE NEW ONE WOULD BRING
IN $170 MILLION IN THE
BEGINNING AND GROWING IN THE
OUTYEARS. WE DO NEED ADDITIONAL
PEOPLE TO MOVE THAT MUCH MONEY
INTO PROJECTS AND PROGRAMS. SO
WE HAVE GONE THROUGH IN GREAT
DETAIL WHAT STAFF WE FEEL WE
WOULD NEED WITH OUR EXISTING
STAFF. AND WE HAVE THOSE
CURRENTLY, PROPOSING TO ADD
ANOTHER $72. NEXT SLIDE,
PLEASE. WE BROKE THAT OUT FOR
YOU IN TERMS OF WHERE THEY WILL
SIT IN THAT SEQUENCE. SO YOU
WILL SEE 19 OF THE STAFF THAT
ARE DEVELOPING THE LOCATIONS,
AND THE ONE THING THAT WE'RE
DOING FROM THAT LEVY, THAT WE
DON'T WANT TO CREATE THAT
BOTTLENECK AS THEY WILL DESIGN
AND MATURE AND TO GO OUT THERE
AND BUILD AND MAINTAIN
AUGMENTING THE CREWS THAT WE
HAVE, NEXT SLIDE. THIS IS THE
LAST SLIDE, ACTUALLY. THIS WILL
GIVE YOU A PREVIEW OF THE NEXT
STEPS. AND THAT WORK PLAN.
STANDING UP WITH OTHER
FUNCTIONS, WHERE WE ARE LOOKING
FORWARD ON WORKING WITH YOU,
ALL OF YOU, IN THE EVENT OF THE
LEVY. THAT CONCLUDES OUR
PRESENTATION.
>> THANK YOU, DIRECTOR SPOTTS.
DIRECTOR NOBLE, ANYTHING TO
SHARE HERE? I'LL PASS IT OVER
TO SAKA AS CHAIR OF THE
COMMITTEE OVERSEEING THE
DEPARTMENT. YOU'RE RECOGNIZED.
>> THANK YOU, MR. CHAIR. THANK
YOU, DIRECTOR SPOTTS AND SDOT
FOR THIS WORK. AND ALL YOUR
HARD WORK TO GET US TO THIS
POINT. IT WAS A LITTLE LIKE
EVEN, YOU KNOW, DISAPPOINTED WE
DIDN'T SEE THE FIRST PROPOSED
BUDGET THAT WE SAW WAS A
CURRENT LAW BUDGET THAT WOULD
ASSUME THE EXPIRING LEVY. BUT
AT THIS POINT TODAY, WHERE WE
WOULD HAVE A PROPOSAL, A SET OF
PROPOSED AMENDMENTS, SHOULD THE
VOTERS APPROVE THE LEVY THAT WE
COULD CONSIDER AND, YOU KNOW,
POTENTIALLY ADOPT, WHICH WOULD
SERVE AS A BASIS FOR US TO
BRING THAT LEVY TO LIFE. I WANT
TO ACKNOWLEDGE THE HARD WORK
THAT'S BEEN PERFORMED BY SDOT
IT, INCLUDING THE READINESS AND
MANDATED AS THE PART OF THE
CHAMPION RESOLUTION FOR THE
LEVY. THAT WAS THE BRAIN CHILD
OF MINE. REALLY THE BRAIN CHILD
OF A BUNCH OF THESE THAT WERE
TELLING ME, BETTER
ACCOUNTABILITY. YOU KNOW, AND
ETC., ETC. THIS REPORT THAT
THEY PRODUCED AND SHARED WITH
US A MONTH AGO IS INCLUDED AS
AN ATTACHMENT. THEIR MATERIALS,
OUR OWN CENTRAL STAFF'S
MATERIALS. THAT'S A DIRECT
RESULT OF THAT. AND I THINK AND
I RECOGNIZE THE HARDWORK THAT
HAS BEEN DONE BY SDOT IN THE
THOUGHT THAT'S BEEN PUT INTO
THAT DOCUMENT. AND, YOU KNOW,
THERE IS A LOT OF FUNDS AT
STAKE HERE SHOULD THE REVENUE
AT STAKE HERE, SHOULD THEY
APPROVE THIS. AND IT IS
RESTRICTED. WE NEED TO BE ABLE
TO SHOW OUR READINESS AND OUR
ABILITY TO IMPLEMENT. ALSO
BASED OFF OF WHAT I HEARD SO
FAR, AND THANK YOU FOR
ANSWERING MY MANY QUESTIONS
OFFLINE AND COLLABORATING WITH
ME AND MY OFFICE AND CENTRAL
STAFF ON ANY NUMBER OF THINGS
PERTAINING TO THE CURRENT LAW
PROPOSED BUDGET OR THE BUDGET
WE'RE TALKING ABOUT NOW. THAT
LEVY BUDGET, BASED OFF OF
EVERYTHING THAT I'M SEEING. I
FEEL CONFIDENT SHOULD THEY
PREPARE THAT SDOT SHOULD
EXECUTE. WE'RE DOING ALL THE
THINGS WE CAN AT THIS POINT IN
THE ABSENCE OF THE CHECK. SO WE
CANNOT HIRE ANYONE. WE NOT HIRE
EVEN CONTRACTORS OR START THE
PLANNING AS FRANCISCA NOTED A
MOMENT AGO. I FEEL GOOD ABOUT
OUR ABILITY. OUR CITY'S
ABILITY TO EXECUTE SHOULD THE
VOTERS APPROVE THIS. BUT AT THE
END OF THE DAY, IT'S UP TO THE
VOTERS. WE WILL LEARN MORE. BUT
I JUST WANT TO AGAIN RECOGNIZE
THE HARD WORK THAT'S BEEN DONE.
AND THE STRETCH. THE EXTRAS TO
GET US TO THIS POINT AND HELP
FACILITATE AND DRIVE
TRANSPARENCY FOR THE IMPORTANT
THINGS. AND WE LOOK FORWARD TO
CONTINUING TO PARTNER TOGETHER
REGARDLESS OF ANY SCENARIO ON A
GOING FORWARD BASIS. SO THANK
YOU. NO FURTHER COMMENTS.
>> THANK YOU, COUNCILMEMBER
SAKA. WE'LL CALL ON YOU AT THE
END AS WELL TO CLOSE US OUT
WITH THE DEPARTMENT
TRANSPORTATION. I SEE
COUNCILMEMBER KETTLE.
COUNCILMEMBER KETTLE, YOU'RE
RECOGNIZED.
>> THANK YOU, CHAIR STRAUSS. I
JUST WANT TO WELCOME DIRECTOR
SPOTTS AGAIN. AND ALSO MR.
GODWIN, OF COURSE, DIRECTOR
EATER, CAN'T FORGET HIM ALONG
WITH DIRECTOR NOBLE AND MR.
CHOW. APPRECIATE YOU COMING
TODAY TO TALK ABOUT
TRANSPORTATION. LOTS GOING ON.
LOTS OF FACTORS OUT THERE. THIS
IS MORE OF A STATEMENT. IN
REVIEWING THE EFFORTS THAT
YOU'RE TAKING. WE'RE A VERY
DIVERSE CITY. BUT WE HAVE
DIVERSE ASPECTS TRANSPORTATION
WISE, AND IT IS NOT SIMPLE.
I'VE OFTEN TALKED ABOUT THAT
PORT THAT WE CANNOT ESCAPE OUR
GEOGRAPHY OR TYPOGRAPHY. AND
THAT REGARDS OUR TRANSPORTATION
NEEDS. THINK ABOUT IT. THE
HILLS, YOU KNOW, I WAS AT THE
FIRE GARAGE TALKING TO THE
TEAM. THEY'RE DOING GREAT WORK
IN TERMS OF KEEPING OUR FIRE
ENGINES AND LADDER TRUCKS UP
AND RUNNING. BUT THEY'RE
TALKING ABOUT THE CHALLENGES.
PIECES KEPT FAILING AND THEY
WILL GO BACK TO THE PRODUCER IN
FLORIDA. AND THEY ARE LIKE
WELL, WHY IS THAT. THIS COMPANY
IN FLORIDA WAS LIKE SHOCKED,
ABSOLUTELY SHOCKED. THEY COULD
NOT BELIEVE IT. AND THEN LIKE
THE ENGINEERING, EVERYTHING
THAT HAS TO GO INTO THAT.
THEY'RE LIKE OH MY GOSH. IT'S
THE LITTLE THINGS LIKE THAT
THAT OUR GEOGRAPHY AND OUR
TYPOGRAPHY IMPACTS OUR
TRANSPORTATION, THAT WILL THEN
IMPACT THINGS LIKE THE FIRE
GARAGE. THERE IS ALSO THE WATER
SPACES, THE PORT OTHER AMERICAN
CITIES DON'T HAVE THAT
CHALLENGES. BUT ADD ON TO THE
DEEP WATER PORT WITH THE LEGS,
THE BASE, THE WATER CANALS THAT
WILL ADD TO THE DIFFICULTY AND
THE DIVERSE NATURE OF OUR
TRANSPORTATION NEEDS. THEY EACH
HAVE THEIR UNIQUE ASPECT OF IT,
WHICH IS REFLECTED AGAIN ON THE
TYPOGRAPHY AND THE WATER SPACE
AND ALL THIS. I SEE THIS IN
DISTRICT SEVEN. MAGNOLIA AND
QUEEN ANNE IS VERY DIFFERENT,
YOU KNOW, THE HILLS, THE
SLOPES, THE STEPS, UP AND DOWN
SIDEWALKS, BY THE WAY, STEPS
JUST TO GO BACK TO THE TOPIC.
IT IS SO UNIQUE. AGAIN, THE
OTHER CITIES DON'T HAVE THIS
ACROSS AMERICA. JUST WITHIN
DISTRICT SEVEN, YOU'LL GO FROM
THAT TO DOWNTOWN, YOU KNOW,
BELLTOWN, UPTOWN, IN THESE
DIFFERENT AREAS. THEY'RE VERY
DIFFERENT, EAST AND SOUTH AND
VERY DIFFERENT FROM THE
BAYSIDE. THESE ARE THE THINGS
THAT WILL PLAY OUT. AND
UNDERLINING THIS, THE FOCUS ON
SAFETY, WHETHER IT IS TRAFFIC,
PEDESTRIAN, AND BIKE SAFETY.
AND THE BIKE MEANING ALL TYPES
OF THE MOBILITY. THE EQUITY
PIECES, WE SAW THIS IN OUR
DISCUSSIONS, AS I RECOGNIZE
THIS AS D7, REPRESENTATIVES
THAT, YOU KNOW, D1, 2, 5, THEY
HAVE VERY DIFFERENT NEEDS
PARTICULARLY IN AREAS LIKE
SIDEWALKS. GOOD GOVERNANCE.
THANK YOU, TRANSPORTATION CHAIR
SAKA FOR THAT HIGHLIGHT. THAT
PLAYS OUT IN SO MANY WAYS.
THERE ARE OBVIOUSLY THE
OVERSIGHT PIECES THAT ARE SO
IMPORTANT, AND I IMAGINE THEY
WERE NOT PARTICULARLY HAPPY
ABOUT THAT. I THINK IT'S
IMPORTANT TO HIGHLIGHT BECAUSE
THAT GOES TO OUR VALUES. ED THE
MAINTENANCE PIECE AND FOCUSED
ON MAINTAINING. WHEN I LOOK AT
YOUR BRIEFING AND I SEE THIS
DIVERSITY OF TRANSPORTATION
NEEDS. WHETHER IT IS THE
NEIGHBORHOOD SAFETY. THROW IN
THAT PEDESTRIAN BIKE SAFETY.
AND THEN, YOU KNOW, THE
GOVERNANCE PIECE, YOU KNOW, THE
STREET MEANS, THE
MODERNIZATION, THE SIGNALS, THE
OPS. YOU KNOW, PEOPLE MIGHT
FOCUS ON THE BIKES, ALL THAT,
BUT NOT ON THE FUN ROADS. BUT
YOU WOULD LOOK AT THE STREET.
THEN YOU ADD BRIDGES. BECAUSE
OF THE COMPLETE APPROACH, THE
ROAD APPROACH. BRIDGES ARE
ROADS TOO. I SEE THIS AT THE
BRIDGE, YOU KNOW, NOW, AND THE
LEAD UP. THAT IS A MAJOR ROAD
SECTION THAT'S BEING UPGRADED,
BUT DOESN'T FALL UNDER THE
STREET MAINTENANCE, BUT FALLS
UNDER BRIDGES. YOU KNOW,
TRANSIT CORRIDOR AND FREIGHT,
YOU KNOW, FREIGHT, IT'S BIG.
IT WILL PLAY INTO IT. BUT THEY
WILL NOT REALIZE THIS IS THE
STREET MAINTENANCE. STREET
WORK. I MEAN, IT'S IT THE
HEAVY LOAD NETWORK, YOU KNOW,
BUT IT WILL ENABLE BACK TO THE
EARLIER POINT, OUR DEEP WATER
PORT. IT IS SO MASSIVE AND SO
IMPORTANT THAT WE WILL PROTECT
IN MULTIPLE WAYS, BY THE WAY.
IN TERMS OF THE TRANSPORTATION
BY HAVING THAT HEAVY HAUL
NETWORK AND THE ROADS, SO THOSE
ROADS, THEY ARE NOT JUST USED
BY THE HEAVY TRUCKS, BUT
THEY'RE ALSO USED BY THE HEAVY
VEHICLES THAT WE'LL USE. SO
THAT'S THE FRAMING THAT I
WOULD LOOK AT THIS IN TERMS OF
SOME OF THESE PIECES. BUT THEN
ON THE GOVERNANCE PIECE, THE
VALUE PIECE, YOU KNOW, THE
PEOPLE STREETS, THE PUBLIC
SPACES, THE CLIMATE RESILIENCY.
AND I HEAR THE DIFFERENT
DISCUSSIONS ON THE DIFFERENT
WAYS AND THE DIFFERENT ASPECTS.
BUT THIS IS HOW I DIGEST IT.
IT'S FOR THOSE THAT WILL LOOK
AT ONE AREA, WHERE THEY WILL
NEED TO UNDERSTAND THAT WE HAVE
TO HAVE THIS DIVERSE APPROACH
AND ALL THE DIFFERENT ELEMENTS
TO IT. BY THE WAY, SOME OF
THESE ELEMENTS WILL NEED TO
COME TOGETHER, YOU KNOW, IN
TERMS OF OUR STREETS WHERE THE
BRIDGES WILL COME IN, THE
FREIGHT WILL COME IN. IT'S NOT
JUST THE ONE LINE ITEM AND THE
STREET MAINTENANCE BUCKET. AND
SO MY BOTTOM LINE IS THAT OUR
DIVERSE NEEDS WILL NEED A
DIVERSE APPROACH. THAT'S THE
END OF MY STATEMENT. I WON'T
THROW A QUESTION ON IT. THAT'S
MY STATEMENT.
>> I CAN THROW A QUESTION IN
THERE. WHAT IS THE DIFFERENCE
BETWEEN MAGNOLIA AND QUEEN
ANNE? MAGNOLIA HAS TWO HILLS,
BUT QUEEN ANNE HAS ONE. AND
MAGNOLIA HAS TWO UPPER
SECTIONS.
>> IF YOU PUT THE WOLF CREEK
RAVINE IN THERE, YOU CAN SAY
QUEEN ANNE HAS TWO. AND THAT IS
A VERY IMPORTANT THING.
>> THERE IS A WHOLE BUNCH OF
STREETS NEARBY.
>> AND JUST GATHER OVER HERE
WHERE THEY WILL DEMONSTRATE
THAT THEY DID A GREAT JOB WITH
THEIR PRESENTATION, IF WE ARE
GABBING. COLLEAGUES, ANY
QUESTIONS? I SHOULD HAVE MY
ZOOM UP. COLLEAGUES, DO WE HAVE
ANY OTHER QUESTIONS? OTHERWISE
I'LL JUMP IN TO MY COMMENTS.
AND THEN I'LL PASS IT TO
COUNCILMEMBER SAKA FOR LAST
WORD, AND THEN WE WILL
TRANSITION INTO CENTRAL STAFF.
SEEING AS NONE, I'LL JUST SAY
I'M THANKFUL WE'RE READY TO
HIT THE GROUND RUNNING SHOULD
THE LEVY PASS. AS YOU NOTED IN
THE BEGINNING OF YOUR
PRESENTATION, THE CRITIQUE OF
THE LAST LEVY WAS THAT WE DID
NOT HIT THE GROUND RUNNING FAST
ENOUGH. THERE WAS AN INITIAL
LAG. WE THEN DID NOT GET INTO
GEAR APPROPRIATELY. THEN WE
WERE SET TO BE IN GEAR AND THE
PANDEMIC HIT WITH INCREASED
COSTS, SUPPLY CHAIN ISSUES,
INFLATION, ETC. AND SO I
APPRECIATE THAT WE ARE HERE
READY TO GO. I CAN TELL YOU
BEFORE COUNCILMEMBER SAKA
JOINED THE COUNCIL. AND I
HESITATE THAT BECAUSE WE ARE
CREATING THEM. I REMEMBER YOU
WERE HERE BECAUSE THEY GOT
AWKWARD WHEN I WAS ASKING ABOUT
THE DIFFERENCE BETWEEN THE
POTHOLES AND THE PICTURES THAT
YOU WERE SHOWING US AT COUNCIL.
YOUR POINT YOU WERE MAKING
ABOUT THE REVENUE THAT THEY
WILL BRING INTO US IS WHAT WILL
GENERATE THOSE IMPROVED
STREETS. THEY HAVE TO
UNDERSTAND AS OUR CITY HAS
GROWN IN THE LAST TEN YEARS,
WHICH WILL HELP CREATE THE
STRUCTURAL BUDGET DEFICIT, THAT
GROWTH DID. WE ARE HAVING
COLDER WINTERS, WHERE THEY'RE
FREEZING, WHICH WILL CREATE
MORE NEED FOR FILLING POTHOLES,
FIXES THE STREETS. WE'LL BE
ABLE TO DELIVER FOR EVERYDAY
SEATTLITES. I WANT TO EMPHASIZE
OUR NEED ON THE PLANNING TO GET
THAT UNDERWAY. I KNOW AGAIN
BECAUSE OF THE LAST LEVY THAT
DID NOT GET OFF TO AS FAST OF A
START THAT WE WOULD HAVE
DESIRED THAT WE WOULD HAVE A
LOT OF BIG DREAMS ABOUT HOW WE
COULD SUPPORT THE BRIDGE
INFRASTRUCTURE HERE IN THE
CITY. AND I KNOW THAT WE
TECHNICALLY MET THE GOALS, BUT
I WISH WE WOULD HIT OUR STRETCH
GOAL HERE. AND THE LAST CHAIR
OF THE COMMITTEE HAD ATTEMPTED
TO BOND TO PUSH THE HAND TO
ADDRESS OUR BRIDGES. WHILE I
AGREED, I COULDN'T HAVE AGREED
IN THAT MOTION BECAUSE WE HAD
NOT DONE THAT MOTION TO USE
THOSE DOLLARS EFFICIENTLY,
WHICH MEANT WE WOULD HAVE BEEN
PAYING INTEREST ON DOLLARS WE
COULDN'T USE. COLLEAGUES,
ANOTHER EXAMPLE OF USING BONDS
AS LEVERAGE. IT WAS TIME. I'VE
ALL TRACK OF TIME AT THIS
POINT. WE ARE DESCRIBING TAKING
OUT THE BONDS FOR THE LAKE CITY
COMMUNITY CENTER A YEAR LATER
COULD ALLOW ANOTHER PROJECT TO
BE ACCOMPLISHED. THAT'S AN
APPROPRIATE USE OF BONDING. THE
PLANS ARE READY FOR THAT
PROJECT. AGAIN, I APPRECIATE IT
SEEMS AS IF YOU'RE READY TO GO
ON THIS PLANNING AND THE
DEVELOPMENT FOR THE BRIDGES
BECAUSE WE HAVE A LOT OF WORK
TO DO. I DON'T HAVE QUESTIONS
FOR YOU, BUT I WILL PROBABLY
HAVE MORE QUESTIONS FOR YOU AS
WE DIG DEEPER INTO THIS. BUT I
WILL SAY THAT I APPRECIATE YOUR
TWO SLIDES, ONE OF NORTH
SEATTLE AND ONE OF SOUTH
SEATTLE TO REALLY SHOW THIS IS
WORK THAT'S TOUCHING EVERY
DISTRICT. IT'S TOUCHING EVERY
SEATTLEITE. WE ALL DON'T LIVE
IN TRANSPORTATION, BUT WE USE
THE TRANSPORTATION NETWORK
EVERY SINGLE DAY. SO THEY USE
THE WORK THAT YOU ACCOMPLISHED.
WE ARE JUST NOT AS DEEP IN THE
WEEDS ON IT AS YOU ARE. I
REALLY APPRECIATE THE WORK THAT
YOU'VE DONE. AND I'M SURE
THAT WE WILL HAVE MORE TOUGH
QUESTIONS FOR YOU ONCE WE DIG
INTO THE SUBJECT MATTERS A
LITTLE MORE DEEPLY, THANK YOU.
COUNCILMEMBER SAKA IS CHAIR OF
THE COMMITTEE OVERSEEING THE
DEPARTMENT. THE FLOOR IS YOURS
TO CLOSE US OUT.
>> THANK YOU, MR. CHAIR. I WANT
TO APPLAUD THE WORK BY SDOT
THAT HAS BEEN DONE TO GET US TO
THIS POINT. AND RECOGNIZING
THAT, YOU KNOW, WE HAVE AS A
CITY, BEEN ABLE TO INCORPORATE
THE LESSONS LEARNED FROM THE
INFAMOUS LEVY RESET. AND IT IS
VERY CLEAR BY THE HARD WORK.
AND INCORPORATING THOSE LESSONS
LEARNED AT COUNCIL DIRECTION
AND THE TEAM THAT ACTUALLY DOES
THE HARD WORK OF DOING THAT IS
RIGHT HERE BEFORE US. I JUST
WANT TO SAY, YOU KNOW, I
APPRECIATE IT AND ALL THE
EFFORT THAT HAS BEEN MADE SO
FAR TO MAKE SURE THAT WE ARE
BEING TRANSPARENT,
DEMONSTRATING OUR READINESS,
AND OUR ABILITY TO ROLL UP OUR
SLEEVES AND GO SHOULD THE
VOTERS AUTHORIZE THIS. AGAIN, I
FEEL AS CHAIR OF OUR CITY
TRANSPORTATION COMMITTEE, I
FEEL CONFIDENT. I'M CONFIDENT
IN THEIR ABILITY TO EXECUTE AND
BE IMMEDIATELY READY TO GO
START DELIVERING ON THESE
VARIOUS PROJECTS, IF THAT IS
WHAT THEY DECIDE. BUT I DO KNOW
AS WELL OUR CITY WILL BE READY
IN ANY SCENARIO. AND AGAIN, I
JUST WANT TO APPLAUD AND
APPRECIATE THE WORK THAT HAS
BEEN DONE. I KNOW THAT, AND I
RECOGNIZE FOR NEXT YEAR AND
THEN 40 SOMETHING FOR '26, IT
WAS HEARTENING TO SEE THE
PEDESTRIAN SAFETY PROJECTS.
I'VE ALWAYS SAID ANYONE IN THE
CITY OF SEATTLE WHO WORKS ON
BUILDING NEW SIDEWALKS, THEY
WILL HAVE A BRIGHT FUTURE. AND
SO IT WAS GOOD TO SEE SOME
PROPOSED BUDGET AUTHORITIES TO
BRING THAT TO LIFE. IN ANY
EVENT, THANK YOU AGAIN. I'M
SURE I WILL AND ALL OF US WILL
HAVE MORE QUESTIONS AS MR.
CHAIR, YOU ELUDED TO EARLIER AS
WE CONTINUE TO DIVE IN. BUT
AGAIN, WHERE I'M AT TODAY,
THIS IS TERRIFIC. SO THANK YOU.
>> THANK YOU. ANY FINAL
COMMENTS FROM THE DEPARTMENT
BEFORE WE'LL MOVE ON TO CALVIN
CHOW'S PRESENTATION?
>> THANK YOU SO MUCH FOR THE
OPPORTUNITY TO PRESENT TODAY.
>> SOUNDS GOOD.
>> CLERK, DO I NEED TO READ THE
NEXT ITEM IN OR IS IT STILL THE
SAME? DOUBLE CHECKING. AND WE
HAVE CALVIN CHOW MOVING UP. SO
WE HAVE TO CLOSE THE BLINDS,
SORRY, COLLEAGUES. [ LAUGHTER ]
>> GOOD MORNING, COUNCIL
MEMBERS OR GOOD AFTERNOON.
CENTRAL STAFF. THANK YOU FOR
YOUR TIME. I'LL TRY TO KEEP
THIS SOMEWHAT SHORT AS I HAVE A
SHORT PRESENTATION TO HIGHLIGHT
JUST SORT OF HOW THIS ALL FITS
INTO THE BUDGET CONTEXT THAT
WE'RE ALL DEALING WITH, THEN
OPEN IT UP FOR THE QUESTIONS
AND THE COMMENTS THAT WILL GO
BEYOND THAT LEVY AS WELL THAT
YOU MIGHT HAVE. AND SO JUST AS
A REMINDER THAT WE HAVE SAID
THIS A FEW TIMES, BUT THE
BUDGET THAT'S IN FRONT OF YOU
WILL REFLECT THE MOVE SEATTLE
LEVY. IT DOES NOT INCLUDE THE
LEVY THAT IS BEFORE VOTERS. SO
THEY SHOW A NUMBER OF THE
REDUCTIONS. IT DOES NOT REFLECT
CHANGES THAT WILL BE NECESSARY
IF WE DON'T HAVE CONSUMING
FUNDING. AND SO THAT'S
SOMETHING WE'LL NEED TO TAKE
ON IN THE EVENT THAT THE LEVY
DOES NOT PASS. THIS IS JUST THE
CHART IN SHOWING WHAT THAT
PROPOSED BUDGET WILL LOOK LIKE.
THEY WILL JUST SHOW THAT IT IS
SIGNIFICANTLY LOWER FOR
OPERATIONS. IT'S A 5.3%
ADOPTED. FOR THE FUNDING, IT'S
ACTUALLY ABOUT A 52% DECREASE.
SO IT REALLY HITS OUR CAPITAL
PROGRAMS. AND A REMINDER OF
SOME LEGISLATION THAT YOU WOULD
HAVE TAKEN TO DATE. YOU
AUTHORIZED THE SUBMITTAL OF THE
TRANSPORTATION LEVY IN JULY.
AND THAT ESTABLISHED AN
EIGHT-YEAR SPENDING PLAN AND
THE DELIVERABLES. THAT'S THE
ATTACHMENT A THAT WAS DESCRIBED
JUST A MOMENT AGO. AND THE
LEVY, THEY ALSO INCLUDE THE
REQUIRED SPENDING OVER THE
EIGHT YEARS THAT'S TRACKED TO
THAT SPENDING PLAN. YOU WOULD
HAVE SOME FLEXIBILITY TO CHANGE
WITHIN THAT AFTER THE LEVY
OVERSIGHT COMMITTEE HAS
REVIEWED THAT DOES REQUIRE THEM
TO MAKE CHANGES TO THE SPENDING
PLAN. WE ARE PLEDGING TO VOTERS
THAT THIS IS THE BILL OF GOODS
THAT YOU WILL BE DELIVERING.
>> AND THIS IS SORT OF THE NOSE
PLANTING RULE, WHERE WE ARE
PROMISING THAT WE WILL MAINTAIN
TO BE ABLE TO COLLECT THE LEVY.
IT WILL INCLUDE THE REPORTING
REQUIREMENTS THAT HAVE BECOME
STANDARD PRACTICE FOR THE LEVY.
YOU PASSED THE RESOLUTION THAT
ADDED, PROVIDED DIRECTION ON
IMPLEMENTATION OVERSIGHT AND
REPORTING. IT WILL DIRECT THE
LEVY ASSESSMENT, READINESS
ASSESSMENT THAT WE HAVE
DISCUSSED, AND ALSO THE AN L
WITH A WORK PLAN REPORTING, SO
THE END OF JANUARY IN EVERY
YEAR AT THE DEPARTMENT, THEY
WILL PROVIDE A WORK PLAN ON
WHAT THE DELIVERABLES ARE FOR
THE NEXT YEAR. THEY ALSO HAD A
REQUIREMENT FOR POST PROJECT
DELIVERY ASSESSMENTS FOR THE
PROJECTS THAT ARE OVER $25
MILLION. LASTLY, YOU ALSO TOOK
ACTION ON THE TRANSPORTATION
FUNDING TASK FORCE RESOLUTION.
AND DIRECTING THE FORMATION OF
THAT TASK FORCE. SO I WON'T GO
INTO THIS ONE.
>> CAL, IF I COULD INTERRUPT
YOU VERY QUICKLY. THIS IS A
VERY HELPFUL SLIDE. I'M
REACTING TO IT IN REAL TIME,
COLLEAGUES. IN THE LEVY
CONVERSATIONS THAT WE WOULD
HAVE IN JULY, IT WAS ABOUT
EIGHT YEARS WORTH OF FUNDING
MECHANISMS. AND WHAT WE HAVE IN
THE BIANNUAL BUDGET ARE ONLY
TWO YEARS. AND WE DON'T WANT
THEM TO BE MISMATCHED WITH WHAT
WE HAVE BEFORE US. WE CANNOT DO
EVERYTHING IN AN EIGHT-YEAR
LEVY IN TWO YEARS, SO HERE WE
ARE.
>> VERY WELL SAID.
>> SO I WON'T GO INTO THIS
CHART, BUT THIS IS JUST TO
REALLY SUMMARIZE WHAT THE
EXECUTIVE DIRECTOR PRODUCED
EARLIER AND SHOWS THE
ATTACHMENT A AND THE PROPOSED
SPENDING. AND LARGELY IT IS IN
LINE WITH THE OVERALL SORT OF
PERCENTAGES FOR THESE PROGRAMS
THAT IS CONSISTENT WITH THE
SPENDING PLAN AND THOSE
PROGRAMS THAT ARE A LITTLE
FRONT LOADED. THAT'S ONE OF
THEM, FOR EXAMPLE. BUT IT WILL
MATCH WHAT THAT SPENDING
REQUIREMENTS WILL BE IN THE
LEVY AND IT WILL MATCH THAT
SCHEDULE A. I GUESS ALONG THOSE
LINES, I DO THINK WE CAN EXPECT
SOME YEAR-TO-YEAR VARIANCE IN
THESE PROGRAMS WHERE THEY ARE
LARGE AND THEY WILL REQUIRE
THAT TIME TO DEVELOP AND GET
THE SCOPE READY BEFORE THEY
COULD BE SPENT. AS OUR
EXPERIENCE WITH MOVE SEATTLE
SHOWS, WE WILL BE COMPLETING A
COUPLE OF MOVE SEATTLE PROJECTS
IN 2025 AND 2026. JUST BECAUSE
WE COLLECT THE MONEY IN THAT
YEAR AND THE NATURE MEANS THAT
IT COULD BE DELIVERED OUTSIDE
OF WHEN TO COLLECT THE MONEY.
AND THEY DID INCLUDE STAFFING
REQUEST, SO 72 PROPOSALS, FOR
2025 AND THEY HAVE IDENTIFIED
44 MORE FOR 2026. THOSE WILL BE
REVISITED WITH THE 2026 BUDGET
SUBMITTAL. AS I MENTIONED
BEFORE, THERE IS A REQUIREMENT
FOR THE ANNUAL LEVY SPENT PLAN
EVERY YEAR. SO JUST FOR YOUR
SAKE AND FOR ALL OF OUR SAKES
IN HOW WE HANDLE THIS IN THE
BUDGET, THE RECOMMENDATION IS
TO INCLUDE THE PROPOSAL IN YOUR
CHAIR'S BALANCING PACKAGE FOR
THE TRANSPORTATION ON OCTOBER
30. IF THAT LEVY IS NOT
APPROVED, WE WOULD REMOVE THAT
FROM THAT PACKAGE. ANY COUNCIL
MEMBER PROPOSALS WOULD BE
DEVELOPED AND DISCUSSED DURING
COUNCIL'S DELIBERATIONS,
NOVEMBER 13, NOVEMBER 15. AND
THEN CHAIR, AGAIN, IT IS YOUR
DISCRETION ABOUT WHETHER TO
MAKE THOSE AMENDMENTS TO THE
BALANCE PACKAGE OR CALL THOSE
ITEMS UP FOR INDIVIDUAL VOTES.
AND THE FINAL VOTE WOULD
>> THANK YOU. I THAT I AM RECEIR
HAVE RECEIVED THE
RECOMMENDATION FOR CENTRAL
STUFF ABOUT INCLUDING IT IN MY
CHAIRS PACKAGE. WE STILL NEED
TO WORK OUT SOME DETAILS . I
HAVE NOT SETTLED ON THAT AS A
DECISION POINT, BUT I DON'T
WANT TO MAKE UNNECESSARY WORK.
I DON'T WANT TO MAKE DUPLICATE
OF WORK. I ALSO WANT TO HAVE
EVERYONE BE ABLE TO SEE THIS
PROCESS IN A TRANSPARENT WAY.
THOSE ARE MY GOALS WITH THIS
MISSION. COUNCILMEMBER SAKA?
>> THANK YOU. THANK YOU FOR
YOUR HARD WORK AND EXPERTISE
AND HELPING UNPACK AND ASSESS
THE PROPOSED SET OF BUDGETS FOR
S. AND SOME INITIAL THOUGHTS
AND CONSIDERATIONS FOR US TO
CONSIDER UNDERGOING BASIS.
ALWAYS APPRECIATE YOUR ADVICE
AND IT SOUNDS LIKE SOME
DECISIONS ARE STILL LOOMING ON
OUR CHAIR'S PART . ON THE
SLIDE, I THINK IT'S A GOOD
TAKE AWAY SLIDE. YOU CAN NOTE
THE TIMELINE FOR SOME OF THOSE
THINGS. THANK YOU.
>> THANK YOU. COLLEAGUES, DO
YOU HAVE QUESTIONS FOR CALVIN
CHOW?
>> I HAVE ONE.
>> COUNCIL PRESIDENT?
>> COULD YOU PLEASE GO TO SLIDE
SIX? I'M LOOKING AT THE
PROPOSED FTE NUMBERS FOR 2025
AND 2026. I'M ALWAYS LOOKING
AT BUDGET SUSTAINABILITY.
REGARDLESS OF WHAT HAPPENS IN
NOVEMBER, WHY ARE THERE SO MANY
NEW FTEs THAT WILL BE HIRED ?
I'M ASSUMING THAT A LOT OF THE
BODY OF WORK THAT THOSE PEOPLE
WILL BE DOING IS ROUGHLY THE
SAME AS WHAT THE PEOPLE WORKING
ON THE PROJECTS FOR THE
EXISTING LEVEE DOING?
>> THERE IS SOME OVERLAP OF
POSITIONS THAT WILL CARRY
FORWARD . LARGELY IT IS THE
SCALE AND AMOUNT OF MONEY THAT
IS EXPECTED TO BE SPENT, SO
IT'S ANOTHER 40% OR MORE MONEY
YEAR-TO-YEAR ANTICIPATED , SO
THE EXECUTIVES STATED TO GET
THE MONEY OUT THE DOOR, THEY
NEED THE PEOPLE TO ACTUALLY DO
THE WORK, SO THEY IDENTIFIED
THE 72 POSITIONS FOR 2025 AND
WE WILL HAVE TO SEE WHAT THEIR
ACTUAL STAFFING RECRUITMENT
LOOKS LIKE IN 2025. ONCE WE GET
TO 2026, WE WILL BE ABLE TO
RECONSIDER . IS THAT THE RIGHT
NUMBER FOR 2026 OR DO WE HAVE
TO MAKE FURTHER ADJUSTMENTS?
THAT IS SOMETHING THAT WILL BE
TOP OF MIND FOR THE DEPARTMENT
AS THEY GET STARTED ON THIS.
>> THANK YOU.
>> WELL SAID. I WILL SAY THAT
IT IS MY RECOLLECTION TO GET
OUR LEVY OR MOST RECENT LEVY
ACCOMPLISHED WITHIN THE GOALS
OF WHAT WE HAD SET OUT TO DO,
WE ACTUALLY HAD TO BRING ON
STAFF , BECAUSE WE HAD NOT
APPROPRIATELY STAFFED
PREVIOUSLY. IS THAT YOUR
UNDERSTANDING?
>> YES, THAT IS A FAIR
CONSIDERATION. WE ALSO RELIED A
LOT ON TERM LIMITED POSITIONS
AND HAD ITS OWN COMPLICATIONS
WITH BEING ABLE TO SUSTAIN THE
WORK. I THINK THIS IS MORE OF A
STANDARD APPROACH FOR THE NEXT
EIGHT YEARS OF THIS LEVY.
>> THANK YOU. WELL SAID.
COLLEAGUES, OTHER QUESTIONS? I
THINK EVERYONE IS STILL
REACTING TO THE BIG BUCKET OF
COLD WATER DUMPED ON OUR HEADS
THIS MORNING. IF YOU ALL HAVE
ADDITIONAL QUESTIONS, I WILL
MAKE THE REQUEST THROUGH THE
DIRECTOR. IF MY COLLEAGUES HAVE
MORE QUESTIONS THAT WE ALLOW
RATHER THAN REQUIRING TO GO
THROUGH SHAREPOINT THAT MAYBE
WE HAVE SOME INDIVIDUAL
BRIEFINGS ALONG THE WAY. AGAIN,
I WANT TO MEET YOUR
REQUIREMENTS TO NOT SEND THE
DEPARTMENT NINE SEPARATELY
ELECTED WAYS AND USE YOUR STAFF
TIME WELL, BUT I ALSO WANT TO
MAKE SURE THAT MY COLLEAGUES
ARE ABLE TO DIGEST THIS SINCE
WE ARE RECEIVING THIS OUT OF
ANY TYPICAL CYCLE.
>> WE WILL WORK TO MAKE STAFF
AVAILABLE TO ADDRESS QUESTIONS
THAT THE COUNCILMEMBERS HAVE.
>> WELL SAID. COUNCILMEMBER
SAKA, DO YOU WANT TO CLOSE US
OUT UNLESS ANYONE ELSE HAS
QUESTIONS OR COMMENTS?
>> THANK YOU, MR. CHAIR. I WANT
TO RE-EMPHASIZE THE WORK AND
PARTNERSHIP . WE WILL CONTINUE
TO LOOK FORWARD TO WORKING
CLOSELY TOGETHER . ALL GOOD
FROM MY PERSPECTIVE. THANK YOU,
MR. CHAIR.
>> THANK YOU. BEFORE WE ADJOURN
TODAY'S MEETING , I WILL GIVE
US AGAIN A ROAD MAP . WE ARE AT
THE CENTER POINT OR HALFWAY
POINT IN OUR BUDGET PROCESS.
THE NEXT FEW WEEKS ARE WHERE
COUNSEL WORK WHERE WE GET DOWN
TO WORK . THIS FIRST HALF HAS
BEEN INFORMATION RECEIPT ,
INFORMATION GATHERING. THE BAD
NEWS THAT WE RECEIVED THIS
MORNING MAKES THIS YEAR
DIFFERENT THEN EVERY YEAR SINCE
2008 EXCEPT 2020. HERE WE ARE .
IN THE NEXT WEEK, I WILL BE
CREATING THE CHAIRS BALANCING
PACKAGE AND I KNOW I HAVE
MEETINGS WITH EACH OF YOU THIS
WEEK. IF I CALL YOU SOMETIMES
DURING THE NEXT WEEK, PLEASE
PICK UP. THAT IS MY REQUEST.
AMENDMENTS TO THE CHAIRS
PACKAGE WILL BE DUE NOVEMBER
1st AT NOON. I WILL BE SHARING
WITH YOU IN A TRANSPARENT WAY
WHICH PRIORITIES ARE CONTAINED
WITHIN THE PACKAGING AND NOT SO
THAT YOU DON'T. YOU CAN START
WORKING ON YOUR AMENDMENTS
TODAY FOR THAT NOVEMBER 1st
DEADLINE. WHAT YOU NEED ON THAT
DEADLINE ARE YOUR TWO
COSPONSORS , FUNDING SOURCE AND
JUST ONE BROAD SENTENCE ABOUT
WHAT YOU WANT TO DO. YOU DON'T
HAVE TO HAVE EVERYTHING FIGURED
OUT, BUT THOSE ARE THE THREE
THINGS. ONE SENTENCE ABOUT WHAT
YOU WANT TO DO, TWO COSPONSORS
AND A FUNDING SOURCE. WE WILL
BE RECEIVING VERBAL PUBLIC
COMMENT ON NOVEMBER 30th WHEN
THE CHAIRS PACK AS IS PACKAGES
ARE PRESENTED AT 9:30 AND WE
WILL HAVE A PUBLIC HEARING ON
NOVEMBER 12 , THEN WE WILL GET
INTO BUDGET AMENDMENTS FROM THE
13th TO THE 15th. COLLEAGUES,
THAT IS THE SCHEDULE MOVING
FORWARD. ANY QUESTIONS OR
COMMENTS AT THIS TIME?
>> DID YOU SAY NOVEMBER 30th OR
OCTOBER 30th?
>> I'M SO SORRY. I AM THINKING
WAY AHEAD. IT IS OCTOBER 30th
THAT WILL BE THE CHAIRS
BALANCING PACKAGE. WHERE WOULD
I BE WITHOUT YOU? WITH THAT,
COLLEAGUES, WE HAVE REACHED THE
END OF THE MEETING. THE NEXT
BUDGET COMMITTEE WILL MEET
AGAIN ON WEDNESDAY, OCTOBER
30th AT 9:30 A.M. AND SELECT
BUDGET COMMITTEE WILL SELECT
VERBAL AND WRITTEN PUBLIC
COMMENT AT THIS MEETING. THE
PUBLIC MAY CONTINUE TO SUBMIT
WRITTEN PUBLIC COMMENT. ANY
FURTHER BUSINESS BEFORE WE
ADJOURN? NO FURTHER BUSINESS TO
COME BEFORE THE SELECT BUDGET
COMMITTEE AND WE ARE ADJOURNED.
THANK YOU, COLLEAGUES.