♪♪
-Hello. I'm your host, Brian Callanan.
New economic forecast numbers show tax revenue
for the city of Seattle is declining.
So how will that affect the City Council's efforts
to balance the budget?
Also, how will new surveillance technology impact
public safety in Seattle as well as personal privacy concerns?
City Council President Sara Nelson joins me
to answer these questions
and the ones you're sending in too next
on "City Inside Out: Council Edition."
-We cannot let off -- our foot off the gas pedal
when it comes to doing everything absolutely possible
to staff up our police force. -All that and more
coming up next on "City Inside Out: Council Edition."
♪♪
Welcome once again to "Council Edition"
and welcome to Council President Sara Nelson
from the citywide position nine seat.
Thank you very much for being here
during a very busy time for the council.
-Thank you for having me.
-Let's do this.
You're right in the middle of a budget process.
That's why you're so busy,
which you knew was going to be a challenge.
When the mayor submitted his proposal last month,
there was a deficit of roughly $250 million.
But now the most recent economic forecast shows revenue
for the city is dropping
in some key areas like sales tax and business
and occupation tax.
The council's budget chair, council member Dan Strauss,
voiced his concerns about this
at a recent Select Budget Committee meeting.
-This is hard because I heard many of us
agree on the benefit of so many programs
we, as the city, distribute to our residents,
from tenant assistance to tax assistance and legal aid.
We all want to be able to do these things,
and what we've just learned is that we had
a hard job last week, and this job is even harder today.
-So, we're talking about a decrease in revenue,
it looks like, over the next three years,
a 0.5% decrease this year, 1% next year, 1.5% in 2026
when it comes to these revenues coming in.
What does that say to you about the health of Seattle's economy?
-Well, we were prepared to be grappling
with a significant operating deficit of about $250 million,
and the forecast adds another $48 million of revenues down.
So this is very concerning. However,
because we were -- because we went into this knowing
that we had this challenge,
I believe that most council members didn't have a lot of ads
that they were going to be putting on the table.
So that is a good thing
and that is different from previous years.
-That's true. Okay.
-So that's an advantage
that we had in terms of our approach to this budget.
And the fact of the matter is,
we just have to be more careful in what ends up
finally getting into the balancing package
and then advanced in the end budget.
The $48 million additional deficit does -- is partially
outbalanced by an increase in the projection
for the payroll excise tax.
-Expense tax, otherwise known as JumpStart. Yeah.
-Right. So we've got $27 million more there,
but $48 million left coming into our general fund.
And so one of the ways
that the mayor started out balancing
this budget was using JumpStart for general fund expenses.
-Got it.
And I want to break down that issue in just a little bit.
But there's one stat that really jumped out at me
in looking at this budget committee meeting here.
There's this drop in sales tax, and construction
projects, or a lack thereof, play a big role in that decline.
So from September of last year to September of this year,
the amount of permits issued by the city
was down 40% compared to what the city issued
from 2016 to 2019, right before the pandemic.
It all adds up to $1.7 billion less in sales tax revenue.
It's a big challenge.
I know you're aware of it,
but I just wanted to talk about
how the city can potentially turn that trend around
to encourage more building, more construction in Seattle,
as definitely we saw before the pandemic.
-Well, I love that question. Let me make a finer point on it.
Sales tax is down to such a large extent
because those construction projects are expensive.
I mean, we're talking about the nails and the rebar
that is bought for these projects.
-Sure. -And so that is
why construction decline plays such a big part
in the shortages of our sales tax.
-Interest rates for land too.
That's a piece of it. Sure. -Exactly. And one of the reasons
why construction permits are going down is
because financing charges are going up.
And so this is going to continue to be a problem
in terms of sales tax,
but also be, you know, taxes are also down.
-Right. -And that has been a trend
that we've seen a little bit,
but it really shows up in sharp relief this budget.
That's concerning to me because that shows me that
the business activity of our small businesses
has been in decline,
and I think that part of that is due to a slow return to office.
People aren't downtown buying as many purchases.
And so that is concerning.
The sales tax and the business tax
indicate the strength of our -- of business activity.
So given that, we do have to make building
more housing easier and faster,
and that has been one of my mantras all along.
It's not just about our desire to build more housing,
but we have to remove barriers,
regulatory barriers to make it easier
and faster to bring those buildings online faster.
-I was going to say the mayor recently has been talking
about waiving design review requirements
for development projects downtown.
Those type of enticements for businesses?
-Exactly that.
And there are even smaller, more minute changes
that we could make to the building code, for example.
What are the -- We have to dig down deep
and find out what is slowing these projects
getting out the door and when --
So far I've been talking about housing, affordable housing.
But if you talk to anybody in the city
when it comes to permitting,
there is a nightmare that you will hear.
Difficulty building a bathroom remodel,
getting a master use permit.
And so that is something that we really have to focus on
because if that is slowing down construction
and also consequently business activity from that building,
then that is something that it's a core focus of mine.
-Okay. Thank you very much for that.
I did want to talk about the JumpStart taxes
you brought up earlier
because when it comes to balancing the budget,
the mayor's proposed redirecting about half
of the JumpStart tax fund into the general fund.
That's the fund that pays for basic expenses
like police, parks, et cetera.
So JumpStart as a payroll expense tax
for large companies in Seattle, if you're not familiar with it,
it's been around since 2020,
was originally meant to go
towards affordable housing as well as
environmental initiatives and economic development.
The mayor's office points out his plan maintains
or increases spending on these priorities
without raising taxes.
And that's because JumpStart is outperforming
what it was estimated to bring in.
We had a viewer who sent in this question...
Thank you very much for the question.
I want to add a little context to the point there.
Revenue from JumpStart can be variable or volatile
because it's closely tied to the stock market, bonuses
that high-paid employees receive, et cetera,
and that market can go up and down.
So that basic question of why use JumpStart
to deal with a structural budget issue?
-Well, because it is a source of revenue
that is not by law, by law, dedicated for certain uses,
unlike property tax measures
which have to be spent on what voters approve.
-Yeah. And the council has taken JumpStart money
every year and put it into different areas.
-Exactly. So this is nothing necessarily new in principle.
Ever since we had the JumpStart tax,
about $80 million, $85 million has been used to backfill
general fund expenses. -Okay.
-But here's the thing. What is our alternative?
And our alternative is widespread layoffs.
And so when you look at it that way,
the mayor is making a responsible decision
to use already existing expenses,
which have gone up year after year,
doubling the original anticipated $200 million.
And so this is a source of funding
that we can use to avoid layoffs.
-Okay. I want to ask about this and dig a little further
if I could because there have been some questions
about the future of JumpStart
from people who work in affordable housing
in Seattle, for example.
Patience Malaba,
executive director of the Housing Development Consortium.
I want to take a small piece from her op-ed
in The Seattle Times. She said this...
I just wanted to offer a different point of view there.
How do you respond to that?
-My response is that that op-ed fails to acknowledge
that last year we tripled the housing levy.
And so there is a lot more revenue coming from
the housing levy, a property tax measure, coming into the city.
So that was not mentioned.
And so that is -- And at the same time,
we have got a half a billion dollars
in the Office of Housing's cash balance because it's difficult
to get projects out the door fast enough.
-Right. -It takes many years
to build these projects.
And so there's a lot of money sitting in that balance
right now that will be used as these projects mature
and draw down those resources.
And so I am not overly concerned
about our housing projects being built
because we have more money,
three times more money coming in from the levy.
We also have revenue
from the mandatory housing affordability fees.
And so it's not simply that we're using one source
and offsetting it for general fund purposes.
We have other sources that are helping to pad
that lost revenue that we didn't have two years ago.
-I guess the pushback is there have been so many years
where affordable housing has not been funded to the level
probably it needs to be.
And to take money away from affordable housing
at this point seems like -- it seems like a bad idea.
I just wanted to make sure I threw that out there too.
-Well, when we talk about the level it's supposed to be,
we're also talking about the reality of the city staff
and our affordable housing providers
being able to get their finances together
and get all the paperwork ready to actually build it.
And so when we've got a half a billion dollars sitting
in the Office of Housing cash reserves, that is --
that's an issue of the nature of building in Seattle.
And it's very difficult to braid the proper
financing sources together
to be able to actually have a project shovel-ready
to get out the door.
And so some of the issues
why it's difficult to build housing fast enough
has to do with that
and less the lack of resources. -Got it.
I'm very interested to see what happens next on that front
because I know you're working on that.
-I wanted -- -Please.
-There is another method
that we do have to build affordable housing
and that is the multifamily tax exemption.
And this is a program
that provides a property tax break to private developers
when they include affordable units in their buildings.
And this meets two policy goals at the same time.
It allows for mixed-income buildings,
which is considered to be the healthiest
for our communities to have people
of all incomes living together, and it ensures
that those projects are brought online
a little bit faster because the private sector
can generally build faster because they don't have to
braid as many federal and state resources
to get something out the door.
So don't discount the utility of that program,
which will also be renewed.
And there's going to be --
That's going to be updated next year.
And I'm hoping to see a really strong new program
that will draw more participation
from private developers
so that we can get those affordable units
in these mixed-income buildings.
-Okay. Thank you for that.
I know there's more than one way to build affordable housing,
so I'm glad you're bringing up all these different options.
I do want to talk about an area
where the city wants to make a bigger investment
in police hiring and public safety.
The council recently approved a plan to increase bonuses
for lateral hires, meaning cops from other departments,
so these bonuses would increase from $30,000 to $50,000.
The program would be permanent.
You've been a real champion of this plan on the council.
Tell me why.
-Well, I've been a real champion because I was the one
that called for a renewal of an incentive bonus program in 2022,
because we were dealing with still --
the mass exodus of officers from our department
was still occurring.
That has slowed a bit, but we're not hiring as fast as we can.
We have got to remain competitive
with neighboring jurisdictions, all of whom offer...
-Bonuses of some sort. -Bonuses of some sort,
and our program was set to expire at the end of this year.
We cannot let off -- our foot off the gas pedal
when it comes to doing everything absolutely possible
to staff up our police force.
We still have rising numbers of shooting events, homicides.
There -- you know, people --
The data may show that property crime has been down.
I believe that's because it's less reported
and so this is still a fundamental issue.
Our voters tell us
that public safety is their number-one issue.
To address that,
we absolutely must bring on officers more quickly.
And when we talk about -- Sometimes people say,
"Well, you know, incentives don't really work."
They work to increase the number of applications
that we're getting. -Okay.
-That is provable.
The problem is it takes a very long time
from application to an officer actually getting in
a patrol car on the street.
And that is the -- And so there's a lot of red tape.
And that process is too long.
And that is why we passed a piece of legislation in May
that looks at how can we speed up that process.
Why do we need to speed it up?
Because these people are also applying to other jurisdictions,
and we want to have first dibs on the best officers
for our police department.
-Thank you.
I'm going to offer another perspective on this one too.
Councilmember Morales was the one "no" vote on these bonuses,
and she had this to offer.
-Permanently offering $50,000 in hiring bonuses to SPD
is fiscally irresponsible
in a year when we're facing a major budget deficit,
and at the same time
that this council is offering $50,000 in hiring bonuses
to lateral recruits,
the mayor's budget cuts over $400,000 in funding
to the Office of Police Accountability.
-I just wanted to make sure I brought
in another perspective there.
How do you respond to those critiques?
-Public safety is our core responsibility
as a local government.
We take an oath on the, you know,
on the charter to maintain the health,
safety and well-being of the people of Seattle.
The charter also says
that there must be adequate police presence
in every district of this city.
We have this responsibility to fulfill,
and we can only do so if we have enough officers.
And right now, you might have heard in the meeting
that was aired last week
that the whole North precinct, everything above the Ship Canal,
only has ideally 12 officers on patrol at any one time,
and they don't meet that goal.
On a Friday, Saturday and Sunday night
a couple of weeks ago, there were 13, 15 and 17 officers.
And when you think about all the troublemaking
that's going on at any one time in the top half of our city,
we have got to make sure that we have more officers on patrol.
And crucially, we have to refill the investigative units
that were drawn down to put people in patrol cars
to reduce the 911 response time. It's that work
that is very important to set investigative work,
that crime prevention work
that will help keep drugs off our streets,
guns off our streets, and really track down some
of the repeat offenders of retail theft, for example.
-You'd mentioned sexual assault, too.
There's a lot of things to investigate for police.
-Absolutely. When people complain
that they're not doing enough sexual-assault investigations,
it's precisely because those investigators,
like other investigative units, were deployed to patrol.
-Okay. Thank you.
I'm going to move on to another investment
in surveillance technology the city is making, again,
a measure that you've been a big supporter of.
It's a pilot program
to put closed-circuit TV cameras in three neighborhoods.
We're talking about Aurora Avenue North, Chinatown-ID,
and Third Avenue Downtown,
and also using a real-time crime center to record
and analyze this video.
I know there's a lot to unpack here, too,
but let me start by asking why you supported this plan.
-Well, it wasn't just me that supported this plan.
I want to remind people that this package of technology
was approved by last council,
and we're talking about a council,
the majority of whom pledged to defund the police by 50%,
which didn't happen.
But my point is that they approved the expense
for those technologies to be in the 2024 budget.
This past year,
we had to go through the normal process of review
of any surveillance technology,
per the 2017 surveillance ordinance.
-Right. -And so that's what's taken
the time, and we have to approve each individual technology
per that process.
-Right. -But this was already approved.
And we're going through the final stages of actually,
you know, checking the boxes so it can be deployed.
-Okay.
-So I want to make sure that people understand
that this was in the budget this year
because the last council put it in the budget.
So it's less a potentially ideological issue
than people may realize.
What I will say also is that large cities across the country
are already using this technology
because it aids in officers being able to respond to crime
as it happens,
and it also brings -- it also allows for real-time video
feeds of people,
private businesses that allow for their video to be used.
-Their cameras can be part of the system too, right.
-Right. And usually when you talk to a small-business owner
who's been robbed or broken into for the umpteenth time,
they're trying to show officers their video, you know,
that they already have.
It's very onerous to use that as a piece of evidence.
The crime has already happened, et cetera.
And so progressive cities like Washington, D.C.,
San Francisco, L.A.,
they have already built out a robust real-time crime center
where the different feeds of information
are coming in so that the police can respond more quickly.
That is good for public safety
because if they can get to a robbery in action
and have that case wrapped up more quickly,
they're also able to respond to emergencies,
you know, that are putting the health and safety
of our constituents at risk.
And so when we have it,
when we can take advantage of these
fairly non-controversial technologies,
at the same time that we have a severe lack of police officers
on the street,
we have a responsibility to use all the tools
we can to make our city safer.
-Thank you.
Let me jump in with just some background on this one too,
because in public comment,
I heard from a lot of residents of Seattle
who are very supportive of these cameras.
And then there were others,
including the city's own Office of Civil Rights,
who thought they might do more harm than good.
One concern is because these cameras are
in these three neighborhoods,
they might draw so much political attention --
excuse me, police attention
that it could make racial disparities
of our criminal legal system even worse.
I know you've heard that critique.
I wanted to make sure that you responded to it, please.
-Yes, I will respond to it by saying
that our mayor grew up in one of these communities,
and he's very attuned to what those people
in those communities want,
because we have to also look at the racial disparity
of the people that are being victimized by these crimes.
-Sure.
-And he had broad support from these communities
for this technology.
So I understand the civil liberties concern.
At the same time,
council members and the mayor
have to balance all the other requests
that people are making for additional...
additional police protection.
-Okay. Thank you.
I wanted to work on one other
public safety issue with you here
before we wrap up the budget.
it appears we might be near the end of the consent decree that's
been hanging over the Seattle Police Department since 2012.
So this was a process
that started after some concerns about the SPD's use of force
and biased policing about a decade or so ago.
The federal judge overseeing this case
is now saying he still has concerns
about police accountability.
But if the city can show
that the SPD has its crowd-control rules
on the right track,
the consent decree could be lifted sometime
in the near future.
I feel like we've been talking about this
at the city level for about the past year here or so.
What does this mean?
Where do you see this process going?
-Well, first of all, Judge Robart did also acknowledge
that the consent decree process does not have jurisdiction over
accountability measures which have to be bargained.
-Negotiated in the contract with police.
-Right. So we're still pushing on that,
but those issues have to be bargained
with the police department, with SPOG.
So there's not a lot that the -- that our...
the monitor or the judge can act on right there.
But the crowd-control practices are a standing issue.
What has to happen is
a new ordinance that will outline the principles
that will govern the use of less lethal weapons.
-Yes. Right. -And so, to me,
less lethal weapons are better than lethal weapons.
Okay? And so this is part of the toolkit
that the officers have to use
in times when there is a potential of threat
to life of the protesters or the surrounding community.
So this is an outstanding issue that we are seeking to --
Well, the mayor has sent down legislation
that will establish new principles
and hopefully satisfy the judge that we have a solution at hand,
and this legislation will come before council
after we're done with the budget process.
And it will be led by Councilmember Kettle,
who is the Chair of Public Safety.
-Okay. Looking forward to that
in late November, early December.
I know there's a lot of work ahead here.
I wanted to bring up one final budget issue
that many of our viewers have asked about.
It has to do with the Seattle Channel
and the mayor's proposal to cut its budget by more than half,
which, full disclosure, would involve cutting my position
as a contractor here
and the jobs of several employees
here at the channel too.
I testified this -- testified about this
in front of the council, I should say, earlier this month.
And I know you've spoken out about this,
and our viewers want to know this basic question...
Thank you very much for that comment.
What can you tell us?
-Well, I have submitted a budget request
to restore full funding
so that all that programming can continue.
And why do I care so much about this?
The Seattle Channel is a public service
that educates our constituents.
Well, people across the world can access it by YouTube,
by streaming, et cetera,
and it is beloved.
These programs are beloved programs,
award-winning programs.
And we have received floods of e-mail
in support of maintaining this programming.
We can't cut it right now, especially at a time
when so much local media is going under, frankly,
across the country. -Newspaper a week.
Yeah. It's not pretty. -Right.
And so we have got a free resource
that we offer to our constituents, to the city,
to the world that talks about hyperlocal issues,
advances the arts, engages people on civic issues,
and makes it possible for you to grill me about
our priorities for the budget and everything else.
-Yeah.
-It is important that we maintain this because it's part
of maintaining a well-informed
electorate and also showlighting our arts and...
arts and civic -- -Culture, yeah, all of it.
-All of it.
So it's very important that we keep that going.
And so I am hoping that the budget chair does include
my request to restore full funding
in this balancing package.
-And we'll see that balancing package here
in the last week of October.
Thank you for that. I have one last question
I'd like to wrap up with you, an end-of-year message
from one of our viewers to finish up...
Thank you very much for the message.
I know you've had some progress,
definitely with some public safety priorities,
some challenges with some issues like gig worker minimum wage.
But talk to us about this,
your assessment of what you've been able to do
as council president this year.
-I can't take credit for what we have done this year.
I will say that setting the tone early on
that we were going to listen to our constituents
and be responsive to their urgent needs,
we're trying to do that primarily with public safety.
It was public safety that was on the ballot last fall.
And that's what got most of these people elected.
And we have passed 11 public-safety-related pieces
of legislation so far.
That's a lot of legislation.
And I think that it establishes our brand
as being responsive to the top priority of our constituents.
So I am pleased with that.
And there's more to do on that front.
I also would like to highlight that this is a council
that is not...
that is showing some restraint and some discipline
when it comes to spending in this budget.
I'm not hearing -- I could be wrong,
but I'm not hearing a push for additional sources of
revenue or taxes. -New taxes, right.
-This is a council that seems to be committed
to spending within our means and using our existing resources,
and I think that that is the right way to go.
And we've tried to set that tone from the get-go.
And so I do think
that we are working with a different ethos
in this council, and I want to see that go forward next year
now that people have had a time
to ramp up after their first year
and then really hit our stride next year.
-Alright. Council President Sara Nelson,
thank you very much for joining me.
-Thank you very much for having me.
-Alright. And thanks to everybody out there
watching "City Inside Out: Council Edition."
We'll see you next time.
♪♪