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February 11, 2025 Special Election
Proposition Nos. 1A and 1B
Proposition 1A (submitted by Initiative Petition No. 137) and Proposition 1B (alternative proposed by the Seattle Council and Mayor) concern payroll expense tax funding for the Social Housing Developer.
Proposition 1A would impose a tax on payroll expenses for employers doing business in Seattle. The tax rate would be 5% on annual compensation above $1,000,000 paid in Seattle to any employee. Proceeds would support the Social Housing Developer, a public development authority created to develop, own, and maintain social housing in Seattle. The tax imposed would be in addition to the City’s payroll expense tax levied under Seattle Municipal Code Chapter 5.38.
As an alternative, the Seattle City Council and Mayor have proposed Proposition 1B (Ordinance 127101), which would allocate $10,000,000 of existing payroll expense tax revenues from the next five annual budgets to fund the Social Housing Developer. Proceeds would support the acquisition and development of social housing in Seattle. The Developer would have to apply and meet certain conditions as determined by the City before the award of funds. If no allocated funds are awarded within three years of their initial allocation, they would be available to support other affordable housing projects.
1. Should either of these measures be enacted into law?
Yes
No
2. Regardless of whether you voted yes or no above, if one of these measures is enacted, which one should it be?
Proposition 1A
Proposition 1B
This measure presents voters with two questions regarding payroll expense tax funding for the Social Housing Developer, the public development authority previously established by voter approval of Initiative 135 in February of 2023. The Developer was created to develop, own, and maintain social housing in Seattle.
The first question is whether either of two alternative propositions should be adopted, both of which involve funding the Developer with proceeds from a payroll expense tax. The second question is which of the two alternative propositions should be adopted.
If a majority of voters vote “No” on the first question, then neither proposition will be adopted. If a majority of voters vote “Yes” on the first question, then the proposition receiving the greater number of votes in the second question will be adopted. Voters may vote on the second question regardless of their vote on the first question.
Proposition 1A
Proposition 1A would impose a new payroll expense tax on any employer doing business in Seattle city limits. The amount of the tax would be calculated as 5% on the total amount of annual compensation paid to any employee in Seattle above $1,000,000. The tax would be in addition to the existing payroll expense tax levied under Seattle Municipal Code Chapter 5.38. At least 95% of the tax revenue would be allocated and transferred to the Developer. The maximum annual allocation to administer the tax is 5% of the tax revenue or $2,000,000, whichever is lower.
The following would be exempt from the tax: (1) any individual who is an independent contractor and whose annual compensation in excess of $1,000,000 is included in the tax paid by another business; and (2) businesses preempted from taxation by cities pursuant to federal or state statutes or regulations.
Proposition 1B
Proposition 1B would allocate $10,000,000 of existing payroll expense tax revenues from the next five annual budgets to fund the Developer. Proceeds may be used for the acquisition, construction, or rehabilitation costs of social housing, except that the funding may only be used for the costs of housing residents up to 80 percent of area median income. Up to 5% of the amount allocated may be used by the Developer to pay for its administrative costs.
The Developer must hire a chief executive officer and chief financial officer, and demonstrate that it has adequate financial controls, as determined by the Director of the Office of Housing, prior to receiving funding for housing projects.
If dedicated funds for housing projects are not awarded to the Developer within three years of their initial allocation, the funds would be made available through the City’s regular process that funds other affordable housing projects.
Statement in favor
Seattle faces an unrelenting affordable housing and homelessness crisis. With a rapidly growing population and steeply increasing cost of living, many of us are being priced out of our communities. It’s clear that our current tools for creating and maintaining affordable housing are insufficient. Proposition 1 would help address this crisis by collecting money that the Seattle Social Housing Developer (SSHD) will use to create and maintain publicly-owned, permanently affordable, mixed-income social housing in Seattle.
The homes created by the SSHD through Proposition 1A will be permanently affordable housing. These accessible, affordable, environmentally-friendly, union-made, high-quality homes would be available to renters across incomes – including educators, healthcare workers, childcare providers, those with fixed incomes, and marginalized communities that may otherwise be displaced. Importantly, creating more homes will help lower the cost of housing for everyone.
Seattle voters created the SSHD in February 2023 by voting overwhelmingly in favor of Initiative 135. However, the measure did not include a funding source because doing so would have violated the state’s “single subject rule” for initiatives. Vote Yes on Proposition 1 (and 1A) to fund the Seattle Social Housing Developer.
Let’s build a Seattle where everyone can afford to live and thrive.
Submitted by: Frank Chopp, Sharon Lee, Nick Licata, info@houseourneighbors.org
Statement in favor of Prop 1A
Proposition 1A taxes the wealthiest businesses to establish a dedicated fund for the Seattle Social Housing Developer (SSHD) to carry out its voter approved mandate. The City estimates Prop 1A will raise $50 million a year for the SSHD to create permanently affordable, publicly owned, mixed income social housing.
We live in one of the wealthiest cities in the world, but not all Seattleites benefit from that wealth. Proposition 1A challenges this disparity, directing resources from the wealthiest businesses to the SSHD to build a housing stock that is affordable to all Seattleites.
This dedicated revenue stream will create more than 2,000 units, including family-sized units, of social housing over the next 10 years. Proposition 1A would ensure that nurses, teachers and educators, firefighters and artists can afford to live in our City. Proposition 1A gives Seattle new tools to fight our housing affordability crisis and fulfills the mandate created by voters when they created the SSHD. Proposition 1A takes our housing crisis seriously and would fund an internationally proven model of housing.
Proposition 1B does not take the housing crisis seriously. Proposition 1B keeps taxes low for wealthy businesses and stifles social housing.
Submitted by: Rebecca Saldaña, Robert Cruickshank, Tammy Morales, info@houseourneighbors.org
Statement in favor of Prop 1B
We encourage you to vote Yes on 1B to support funding social housing with accountability and transparency and vote No on 1A that creates a brand-new tax providing $50 million per year, forever, to one organization that has never built a single unit of housing.
We need more affordable housing and accountability, but the social housing Public Development Authority (PDA) was only created in 2023 and uses an unproven concept for building and managing housing. Social housing has never been tried in Seattle and is done in one other place in the United States. This concept may have merit, but can it deliver $50 million worth of housing every year when it hasn’t delivered any?
We support affordable housing and that is why we support Proposition 1B to provide $10 million a year of existing tax revenues for 5 years to test the concept works. Proposition 1B adds the accountability and reporting requirements that Proposition 1A does not have. Proposition 1B requires the City’s Office of Housing, a successful agency with a 40-year track record building thousands of housing units, to oversee and report on the progress of this social housing PDA. Please vote Yes on 1B.
Submitted by: Al Levine, Maria Barrientos, Lisa Nitze, peopleforresponsiblesocialhous@gmail.com
Social housing backers say they are establishing a new “progressive” direction in housing policy. In fact, social housing will direct up to 100s of millions of our limited tax dollars to build housing for people with higher incomes up to $126,000 a year.
Over 12,000 people are homeless in Seattle every night. Another 30,000 risk losing homes to increased rents and demolition. Any new tax revenues should go toward assisting these truly poor folks. Over the first ten years of social housing, advocates want exclusive use of $520 million to build 1,940 higher income apartments but only 60 for homeless and poor people.
Two years ago, social housing backers promised they’d be creating projects by now financed only from the sale of bonds and rent charged on their units. Instead, they’ve done nothing. In addition, social housing advocates want to give all this money to an opaque start-up organization, the Seattle Housing Developer, that has never built a single unit of housing.
Over two dozen non-profits have a decades-long, proven track record of building housing for the poor in Seattle. That’s where these millions need to go. Vote “No” to stop both reckless measures from becoming law.
Submitted by: Alice Woldt, Roger Valdez, George Howland Jr., georgehowlandjr@gmail.com
Rebuttal of statement in opposition
Opponents argue that we shouldn’t address the housing affordability crisis for all Seattleites. We disagree -- too many of our neighbors are struggling, and our city is losing too many of the communities that make it great.
As a municipal agency, created by the voters, the Seattle Social Housing Developer is staffed and led by experts in real estate, housing development, architecture, and public housing financing-- all ready to get to work building social housing.
Submitted by: Frank Chopp, Sharon Lee, Nick Licata, info@houseourneighbors.org
Rebuttal of statement in favor of Prop 1B
Proposition 1B takes $10 million from affordable housing and essential services to keep taxes low for our wealthiest businesses. It also dismantles the proven business model for social housing, guaranteeing that it fails before producing any of the housing we desperately need.
Creating more delay and bureaucracy isn’t the way out of our housing crisis. It’s how we got here in the first place. We must act at the speed and scale this crisis requires.
Submitted by: Rebecca Saldaña, Robert Cruickshank, Tammy Morales, info@houseourneighbors.org
Rebuttal of statement in favor of Prop 1A
When the SSHD was created in 2023, the same supporters as 1A said “no government subsidy necessary”. Two years later, they want $50 million a year. They said 12% of units for the homeless and low income, now it’s 3%. And they want taxes to subsidize homes for people earning 120% of median income – not our poorest residents.
1A would increase taxes again on jobs when downtown and neighborhood businesses are struggling. Vote for 1B.
Submitted by: Al Levine, Maria Barrientos, Lisa Nitze, peopleforresponsiblesocialhous@gmail.com
When it comes to Seattle’s housing crisis, we need practical solutions. Developing affordable housing is a highly technical, difficult task. Proposition 1 would give up to $52 million tax dollars a year, in perpetuity, to an unelected, inexperienced and inaccessible organization, the Social Housing Developer. Proposition 1 contains no oversight, timeline or required results for these housing development rookies.
Proposition 1 is a risk that Seattle cannot afford.
Submitted by: Alice Woldt, Roger Valdez, George Howland Jr., georgehowlandjr@gmail.com
Question 1 - simple majority; Question 2 - measure receiving highest number of votes (City of Seattle Charter, art. IV, sec. 1(G))
For questions about this measure, contact: Polly Grow, Seattle Ethics and Elections, (206) 615-1248, polly.grow@seattle.gov
Contact Elections
Email: elections@kingcounty.gov
Phone: 206-296-VOTE (8683)
TTY: Relay 711
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