Read the City’s Statements Critically!
The Quick Answer
The City has recently sent out a four-page color, glossy brochure on Proposition 1.
To the casual reader, it makes the City's financial situation sound particularly dire. We encourage you to parse the statements the City makes carefully, ask questions, and research the facts.
On Inflation and “Expiring” Levies
The flyer says:
Washington state law limits most jurisdictions to an increase in property tax revenue of 1% per year unless authorized by a vote of the people. Because inflation often rises more than 1% a year, a structural imbalance exists. [...] The 2016 levy expires December 31, 2022.
While nothing in that statement is false, it makes it sound as if the City will be desperately short of revenue in 2023 if Proposition 1 is not passed. It leaves out significant parts of the story:
- The Levy Lid Lifts we've had in place have allowed the City's general levy to increase at about twice the rate of inflation, from $7.6 million in 2012 to $15.2 million in 2022.
- Those Lid Lift measures were “multi-year permanent lid lifts”. None of the tax increases that they allowed go away in 2023 (or ever).
- The City is predicting a general fund revenue surplus of $8 million for the current biennium (2021-2022).
- Proposition 1 includes a permanent 48%, $7 million increase in the general levy for 2023. That's 39% over the current rate of inflation.
The City is not currently short of cash. If Proposition 1 fails, the City’s general levy will still increase in 2023 (just not by as much.)
On Service Cuts and Balancing the Budget
The City writes:
If the proposed levy replacement does not pass, the City will identify services or programs to reduce or eliminate to balance the City's budget.
Of course, that statement is true — whenever the budget is in the red, the City will need to make cuts to balance it — but it gives a false impression that the cuts will be necessary, and soon.
In fact, the City has just released its proposed budget for the next two years. That budget includes funding for the RADAR 24/7 Mobile Crisis Response Team and expands other City programs. There appear to be no real cuts. That budget assumes that Prop 1 does not pass, yet, it is, essentially, balanced.
Any implication that service cuts will be necessary to balance the budget in the next two years is just fear-mongering.
With Proposition 1, the City is proposing a very large, more than 48%, more than $7 million per year permanent increase in the general levy. The City's budget for the next two years is balanced without that money. It is not clear what the City's plans are for that extra revenue.
We understand that a City's costs increase with time, and have no issue with the provision in the Levy Lid Lift measures (including Proposition 1) that allows taxes to increase with inflation.
But, the initial tax increase of 48% (39% above the rate of inflation) that the City chose to write into Proposition 1, at a time when many residents are truly struggling financially due to the effects of inflation and the COVID pandemic, is, simply, too much!
If Proposition 1 fails, the City can place another Levy Lid Lift measure on the ballot next year — one with hopefully a more moderate tax increase written into it.
There are more details (with references) on the subjects mentioned on this page on our Rebuttal to the “Explanatory Statement” page.