The Seattle City Council unanimously passed a tax on large employers Monday that will aid the city's homeless residents - but not before slashing the proposal almost in half over opposition from Amazon, which is headquartered in Seattle, and a veto threat from Mayor Jenny Durkan.
The ordinance, which would be up for a renewal vote in 2023, will be placed on companies that generate more than $20 million a year in revenue-about 3% of the businesses in Seattle.
"We appreciate Mayor Durkan's efforts to significantly modify the Council's ill-conceived proposal to tax jobs in Seattle", said Downtown Seattle Association CEO Jon Scholes in a statement, after Durkan introduced her original compromise.
Mayor Jenny Durkan said that Seattle now spends about $70 million in annual direct investments to programs that fight homelessness in her first State of the City address.
"While Amazon didn't single-handedly cause this problem, they have contributed to the growing income inequality, displacement and housing affordability issues facing our city", they said in a statement to The Seattle times earlier this month.
"We remain very apprehensive about the future created by the council's hostile approach and rhetoric toward larger businesses, which forces us to question our growth here", Herdener said. They called it a tax on jobs and questioned whether city officials were spending current resources effectively.
The Seattle City Council passed it unanimously in a 9-0 vote.
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Head taxes are extremely rare in the US and the ones in place are a fraction of Seattle's proposal.
Several members of the nine-person City Council said they were reluctantly voting in favor of the smaller tax because there were not enough votes to override a mayoral veto of the larger tax plan.
"Tax Amazon" was the battle cry for supporters of the measure, claiming the Seattle-based behemoth that employs thousands in the city is not paying its fair share.
"There is no way this tax will be a burden on big businesses in Seattle", Sawant told The Seattle Times.
"The city does not have a revenue problem - it has a spending efficiency problem", he said.
But the city says homelessness is a moving target. "If they can not provide a warm meal and safe bed to a 5-year-old child, no one believes they will be able to make housing affordable or address opiate addiction". The Seattle region had the third-highest number of homeless people in the USA and saw 169 homeless deaths in 2017. Those on the smaller end of that scale say they fear they will feel the brunt of it. "We are highly uncertain whether the City Council's anti-business positions or its spending inefficiency will change for the better", Amazon Vice President Drew Herdener said in a statement.
There will also be $14.6 million in workforce stability funding over five years, providing a 4 percent raise for direct service homeless contracts. Separately, the company has committed more than $40 million to two groups: the Mary's Place shelters for homeless families, including space in company buildings; and the FareStart non-profit organization for homeless and disadvantaged men, women, and kids, including space and equipment for FareStart restaurants.