(The Center Square) – This fall, voters in Seattle will decide if they want to increase sales taxes in the city to fund a new transit measure that would expand bus service while the city also faces a massive deficit.
But with residents facing rising property taxes, rising utility bills, high payroll deductions and other potential taxes including capital gains, one Seattle City Council member suggests it may be time for some budget restraint.
Seattle Councilmember Bob Kettle says he wants a reset now, ahead of the fall budget process.
In a letter sent Tuesday to Mayor Katie Wilson Kettle said, “Seattle’s projected budget deficit has ballooned to $175 million for next year, even though general fund revenue (primarily property, sales, utility, and business/payroll taxes) has grown dramatically to over $2 billion, up 17% from $1.72 billion in 2024 and up 40% from $1.44 billion in 2019.”
“Meanwhile, we have asked voters to shoulder additional property tax levies for separate programs every year for the past six years. The ever-increasing tax burden funding new and expanded programs, layered on top of the ongoing affordability crisis, is hampering everyday Seattleites’ abilities to make ends meet,” wrote Kettle.
Seattle residents are also voting in the Aug. 4 primary on Proposition One, a property tax increase to fund Seattle Public Libraries.
In a Tuesday interview with The Center Square, Kettle said business as usual doesn’t cut it any longer.
“We need to be taking care of our charter responsibilities, those main responsibilities, but then maybe freeing up overhead. There are some high salaries, and some high overhead costs to the city,” said Kettle.
Kettle’s letter pointed to three things needed to “realign our city’s expenditures with what our city deserves.”
First is “a priority-based budget system – currently, we simply roll over last year’s budget, add in inflation and pet projects, and call this sufficient. This is inadequate,” wrote Kettle.
“We have to look at affordability pieces whether it’s in terms of property taxes and this shows up in escrow or shows up in higher rents. We should be looking at the levies and sales taxes and then utility rates,” Kettle told The Center Square.
Second is “withdrawing from unnecessary lines of business – the City’s charter articulates the basic services the city should provide; that’s in addition to services approved by voters that are also important. Still, there may be others we can reduce or cut entirely.”
Third is “reviewing our Payroll Expense Tax – A hyper-targeted payroll expense tax is creating unintended consequences for the overall health of our business community and our business tax base. By broadening the tax base and lowering the rate with no net new revenue, we can stabilize the impact on businesses and the city’s revenue long term.”
Kettle told The Center Square that relying on a payroll tax that is unpredictable as wealthy individuals can relocate, is unsustainable.
“We have to look at how do we strengthen traditional revenue sources, B&O, real estate excise taxes. How can we stabilize them?” he said. “I don’t really see that kind of thinking going on.”
In a blog post that accompanied the letter, Kettle said the city can’t afford to delay taking “real action on budget reform.”
“For all these reasons, I’m again calling on our city to take a pause on increasing piecemeal taxes until the opportunity cost impacts of doing so are truly understood,” he wrote.
“Taking a short-term approach can hurt our revenue opportunities in the long term. Incoming city revenue is not keeping up with rising costs, creating an ever-growing budget deficit.”
The Center Square reached out to Wilson’s office for comment on Kettle’s letter and blog post but did not receive a response.
