Seattle voters lean toward funding social housing developer with new tax
Seattle voters are breaking heavily in favor of funding new public housing in the city, and are so far leaning toward doing so with a new tax on high-paying companies.
The results, if they hold in the coming days, represent a resounding victory for those who’ve fought for tapping Seattle’s wealth to build more housing and public services. It would also be a rebuke of City Hall and the Seattle Metropolitan Chamber of Commerce, which urged voters to reject the new tax in favor of using preexisting city dollars for new housing.
Voters were asked two questions. First, should Seattle’s Social Housing Developer receive funding? Second, should that money come from a new tax on companies with employees earning over $1 million a year or from money brought in by an existing tax on Seattle-based corporations?
In Tuesday evening’s ballot drops, voters were saying yes to funding the developer with a healthy 68% of the vote.
On the second question, almost 58% of voters wanted to enact the new tax, while 42% wanted to use preexisting funding.
Seattle elections are rarely determined on election night and votes counted later generally break more heavily for progressive causes and candidates. It could be as late as Friday — or even next week — before the final result comes into focus.
That said, the results appear to favor the new tax.
Tiffani McCoy, spokesperson for the House Our Neighbors campaign in favor of the new tax, called Tuesday’s results a “resounding victory.”
“Voters are tired of incrementalism, they’re tired of waiting for the housing crisis to be addressed,” she said. “They want it to be addressed fully, they want it to be addressed now.”
Rachel Smith, CEO of the chamber, said they would continue to monitor the vote count in the coming days.
The eventual outcome of Tuesday’s election will determine whether Seattle has another bit player in the city’s network of housing providers or a new main character.
Tuesday’s special election is a follow-up, of sorts, to an election two years ago, which greenlighted the creation of a developer of publicly owned housing.
The goal of the developer is to provide mixed-income housing, mostly for working families who fear being priced out of Seattle. It’s a Viennese vision of housing that aims to fill the gap between for-profit builders of higher-end homes and developers of deeply affordable housing for people earning little to no money. Because the housing would be publicly owned, it would be below market rate in perpetuity.
If executed well, the housing will hold people from a range of incomes, with the wealthier residents subsidizing the total cost for the poorer. Its backers hope the body, led by CEO Roberto Jimenez, can guarantee a future for teachers, restaurant workers, tradespeople and others who struggle to live where they work.
Skeptics, though, doubt the body’s readiness for such an enormous amount of money, particularly in a city with so many experienced nonprofit housing developers. Some question why city dollars should be spent on workforce housing in the middle of a homelessness crisis.
Due to state limitations on the scope of voter initiatives, when the developer was created in 2023, it did not have a funding source. Small checks from Seattle and the state government got the ball rolling on administrative tasks — after significant delay — but the developer’s core mission of buying or building housing has been in limbo.
The campaign that won in 2023 launched a signature-gathering effort to enact a 5% tax on all payroll for employees earning over $1 million annually. If an employee, for example, made $1.1 million, the company would pay a 5% tax on $100,000 of payroll. Advocates estimated it would raise $50 million a year.
The campaign was successful. But the Seattle City Council, with the urging of the Chamber of Commerce, decided it wanted a competing measure. Rather than creating a new tax, the second option would dedicate $10 million from the city’s preexisting tax on large businesses — intended for affordable housing — to fund the developer.
The fight since then has been something of a proxy war between the left and more moderate wings of Seattle politics. Backers of the new tax see it as a way to lean on the city’s richest companies to alleviate a housing crisis. Supporters of the second option contend the city’s coffers are already overly stuffed and question if the new developer is prepared and accountable enough to spend that much money every year.
Opponents of the developer more broadly see it as possibly siphoning dollars from more necessary housing for the city’s lowest-income residents.
Spending has been intense. Microsoft and Amazon each spent $100,000 in favor of using existing dollars.
The campaign in favor of the new tax, the House Our Neighbors campaign, has raised $600,000. Most of that comes from the Inatai Foundation, a foundation created when Group Health Cooperative was sold to Kaiser Permanente and aimed at providing “community-oriented and equity-focused” grants.