Morning Roundup

Amazon, the Head Tax, and the Waterfront

Council member Kshama Sawant said Amazon was attempting "extortion."

By Hayat Norimine May 3, 2018

SEATTLE CITY COUNCIL members criticized Amazon over its announcement, reported by The Seattle Times, that it would halt construction on a new tower pending a council decision on the head tax. This was a day after the company announced thousands more jobs in Boston. As a recap, the tax—to affect the city's top 3 percent of businesses, about 585 of them—is estimated to cost Amazon $20 million a year, and would raise money to pour into affordable housing and homeless services.

The proposed legislation would raise $75 million a year, sunset in 2020 for a payroll tax, and create 1,780 affordable housing units over five years. It would be a 26-cent tax per employee hours worked on businesses with $20 million in taxable gross receipts. It would also leverage options for another $125 million bond ($25 million a year) the city could pursue on top of that.

Council members were mostly silent on the move during a committee meeting on the tax Wednesday afternoon shortly after the story broke, with the exception of Kshama Sawant, who called what Amazon was doing "extortion." Sawant's holding a press conference at noon today in front of the Amazon spheres.

Later Wednesday, the council sponsors Lorena Gonzalez, Lisa Herbold, Teresa Mosqueda, and Mike O'Brien sent out a joint statement that criticized the company for its announcement. 

“This was never a proposal targeting one company, but Amazon made the conversation about them when they expressed their intentions to pause construction on their new office tower pending a vote on our progressive tax on business," they said, adding that Amazon has contributed to the growing income inequality in the city and had a responsibility to contribute to solutions.

Durkan told The Seattle Times, "I'm deeply concerned about the impact this could have on a whole range of issues." 

Will the head tax pass? There are five "yes" votes currently on the council; the question then is whether Mayor Jenny Durkan (who has been mostly silent but opposed the tax during her campaign) would veto the bill, and whether the council would have a supermajority to override that veto. Sally Bagshaw, Debora Juarez, Bruce Harrell, and Rob Johnson have all been publicly critical of the tax in the past. 

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MORE PROPERTY TAXES? Following the head tax committee meeting, Juarez also held a civic development committee meeting on a resolution for the city's waterfront improvement program, and the room was packed. On the dais, though, was only Juarez. (Bagshaw was at the meeting but had to recuse herself.)

The plan includes creating a Local Improvement District to fund a part of the project that improves 20 acres of parks and public spaces. That means imposing a property tax for those on the waterfront. Opponents say property owners who live there—and have no plans to sell their property or businesses—won't benefit from the waterfront improvements, and argue that it's a citywide and regional asset.

"I think the LID is actually city-imposed gentrification that our neighborhood and Seattle do not need," said attorney Kevin Peck, who owns a law firm on the waterfront. 

IN IMMIGRATION NEWS, a Seattle federal court on Tuesday for now upheld Daniel Ramirez Medina's DACA status after feds stripped him of his enrollment in the program and detained him last year, the Associated Press reported. The 25-year-old has no criminal history. While federal immigration officials claim he had been tied to a gang, an immigration judge already found that allegation false.

U.S. District Judge Ricardo Martinez said the federal administration can't immediately revoke Ramirez's status and asked for more information. Ramirez's lawyers have until Monday to respond.

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