Shoreline’s 2022 Proposition 1:
The Levy Lid Lift


What About Inflation?

The Quick Answer

We all know that inflation is up, but the City is proposing what is likely to be a 48% increase in its general tax levy. That is roughly 39% above (or five times) the current (high) rate of inflation.

Inflation cuts both ways. It increases the costs of City services, so one should expect tax increases as a result. But it also squeezes the budgets of all City residents. We all have to deal with increasing expenses. Increasing taxes at rates far above that of inflation is neither fair nor sustainable.

The Details

As of August, the Seattle-area CPI-U — the index used to measure local inflation — is up 9.0% over what it was a year ago1.

Note: Some of the notes and reports from the City reference a higher inflation rate. In June 2022, the 12-month inflation rate hit a peak of 10.1%, but, remember that gas prices were crazy high around then. The price of gas is a significant component of the CPI-U index. As gas prices have moderated since then, so has the inflation rate.

Most forecasters are predicting that the inflation rate will drop considerably from its current peak within the next couple of years2.

The City’s General Levy Has Been Increasing Faster than Inflation for Twelve Years

Once in 2010 and again in 2016, voters approved Levy Lid Lift measures similar to what the current Proposition 1 proposes. These have allowed the City's tax revenue to increase at rates that have more than compensated for the effects of inflation for the past 12 years.

The 2010 Levy Lid Lift increased the 2011 general levy by 30% (over 2010), and allowed the levy to increase at the rate of inflation for the following five years (2012-2016). (Note that this was passed after several years where levy increases were capped at the default limit factor of 101%, so the large 30% initial bump was somewhat justified by the need to “catch up” with cost increases over the preceding years.)

The 2016 Levy Lid Lift increased the 2017 general levy by 12.8% over 2016, and, again, five more years of tax increases to match the rate of inflation.

Over those 12 years, the general levy has doubled — a 100% increase — from $7.6 million in 2010 to $15.2 million in 20223. Over that same period, the Seattle-area CPI-U (Consumer Price Index - the preferred measure of inflation) has increased by 44%4.

Over the past twelve years, the general tax levy has increased, on average, at roughly twice the rate of inflation. It's not like the City has been falling behind.

  1. The US Bureau of Labor Statics page on the Seattle-Area Consumer Price Index.

  2. The St. Louis Federal Reserve: “In August, the consensus from the Federal Reserve Bank of Philadelphia’s Survey of Professional Forecasters (SPF) was that the CPI inflation rate will decline from 7.5% in 2022 to 3.2% in 2023 and to 2.5% in 2024”;
    Morningstar: Why We Expect Inflation to Fall in 2023

  3. Data on the total Shoreline general levy is available from the County Assessor’s "Statistical Reports". (Select the year of interest, then look under "Assessed Valuations and Taxes → Cities and Towns → Tax Rate and Levies".) Here are the reports for 2010 and 2022.

  4. Seattle-area CPI-U has increased 44% from August 2010 (CPI-U = 227.6) through August 2022 (CPI-U = 326.8). (Data is available from the US Bureau of Labor Statistics data viewer