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Seattle approves business tax for homelessness
15 May 2018, 11:12 | Austin Hogan
Seattle approves 'head tax' on large businesses despite Amazon's opposition
The council has been debating the so-called head tax for months, and had been considering a higher tax of $500 per employee that would have raised $75 million a year, largely to build about 1,000 new affordable housing units.
Homeless-services workers and unions representing supermarket and hotel workers, among others, supported the larger tax, which was proposed by Councilmembers Mosqueda, M. Lorena González, Lisa Herbold and Mike O'Brien.
The tax that passed Monday will raise close to $50 million annually to fight the homelessness crisis.
Amazon, which had paused planning on two downtown Seattle office towers pending the outcome of the vote, said Monday it would resume construction planning on Block 18. That original compromise was voted down Friday. But its most vocal critic may have been Amazon, which threatened to stop construction on new facilities in the city and put 7,000 jobs on hold over the tax proposal. The company did not comment on the new compromise when GeekWire asked ahead of Monday's meeting.
The only companies affected by the new ordinance would be those generating $20 million or more of annual revenue in the city. Amazon has more than 40,000 employees at its headquarters in Seattle, so the tax could cost the e-commerce giant more than $10 million annually.
Amazon said it is still evaluating whether to sub-lease space in a second future office tower in Seattle, a project called Rainier Square, meaning it may move some planned jobs elsewhere and thus avoid further raising its tax liability. "If we had a weaker movement, we could have won less or even nothing".
In the meantime, Amazon, Starbucks, and the other approximately 3% of Seattle businesses that will be dinged in the process have some time to start saving up.
Sponsors of the tax said Seattle's biggest-earning businesses should bear some burden for easing a shortage in low-priced housing that they helped create by driving up real estate prices to the point where the working poor and many middle-class families can no longer afford to live in the city.
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"We could not find the votes we needed", a disappointed O'Brien said before voting for the smaller proposal. "We'll be back for more!"
The city's homeless population is growing, behind only NY and Los Angeles. The city council president, Bruce Harrell, spoke to a growing "fear of what this city is becoming".
Proponents say people are dying on the streets, and while city-funded programs found homes for 3,400 people past year, the problem deepens.
But the city says homelessness is a moving target.
Meanwhile, median cost of a single-family house in Seattle rose 110 percent since Amazon opened its headquarters in 2010, according to The Seattle Times.
In recent years the city has experienced an economic boom, but in tandem with that also an acute affordable housing and homelessness problem.
The collected revenue would be used to address the civil state of emergency over homelessness that the city has been in since 2015. After that, it would have risen to an estimated $39 million a year.
The Seattle metropolitan area also is home to the third-largest concentrations of homeless people, nearly 12,000 counted in a January U.S. government survey, and almost half of them were living on the streets or otherwise unsheltered. Healthcare companies are exempt, as are non-profits.
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