Katie Wilson, who’s challenging Mayor Bruce Harrell , is looking to raise revenue to close the city’s budget deficit, which requires some creativity since income taxes aren’t allowed in Washington State. Her proposals, designed to keep the burden off low earners, include a penalty for landlords with vacant storefronts or homes, a levy on professional services and a city tax on capital gains.
The race is shaping up as a West Coast counterpart to New York’s mayoral election, where progressive upstart and Democratic nominee Zohran Mamdani holds a double-digit lead over former Governor Andrew Cuomo.
Wilson has gotten a big boost from the national attention lavished on Mamdani. But with a smaller tax base, she’s also trying to propose new levies without pushing people and employers to suburbs such as Bellevue, Washington – or out of the state.
“We are going to need to look for new progressive revenue in Seattle,” Wilson, 43, said in an interview. “On the other hand, I’m not going to be stupid about it.”
Harrell, meanwhile, has his own proposal to ask big companies to pay more. He has proposed temporarily raising the rate of an existing tax on companies earning more than $12 million in gross receipts, while expanding the exemption for small business.
But the otherwise business-friendly mayor — who has also secured support from major labor groups and other elected officials – cautioned against taking measures that will crimp the competitiveness of a city that’s home to the likes of Amazon.com Inc., Starbucks Corp., Nordstrom Inc. and Expedia Group Inc.
“The question will become, is that just organic growth?” Harrell, 67, said in an interview. “Or was it intentional growth based on policies, capital, employee talent, all culminating in the kind of success we’ve experienced?”
Underlying the tax debate is anxiety about Seattle’s incomplete recovery from the social unrest and economic devastation of the pandemic.
Signs of progress abound: The decades-long overhaul of the city’s waterfront was completed over the summer, with bike lanes, a renovated aquarium and pedestrian piers overlooking the Puget Sound and Olympic mountains. Downtown visitors have recovered to 2019 levels and the city center has a record number of residents.
Yet nearly 30% of office space in Seattle’s central business district is vacant, compared with roughly 10% before the pandemic. Some companies with employees still working remotely are leasing less space. Others, like Amazon, have shifted jobs to the suburbs.
While the e-commerce giant still has nearly 50,000 people in offices near downtown Seattle , it has added more than 14,000 corporate jobs in nearby Bellevue since 2017, with plans to reach 25,000 in coming years. While Amazon’s regulatory filings still list Seattle as its headquarters, the company’s website describes its home base as the “Puget Sound region.”
The Wilson campaign was supercharged by Mamdani’s win in the New York Democratic mayoral primary in June. She sometimes downplays the comparison — she says she’s “definitely less charismatic and well dressed than Mamdani.” But she also points out similarities in campaign themes of working people priced out of big cities and voters dissatisfied with politics as usual amid President Donald Trump’s second term.
“We’re in this moment where the establishment Democratic party politics failed to stop this train wreck that was Trump’s election, and I think that there’s a reaction against that, where people are looking for a new kind of leadership that meets the moment,” Wilson said. “And coming out of the pandemic, we saw these huge cost increases, rents going up, everything being expensive.”
The median sale price of a house in Seattle is about $850,000, almost $200,000 more than in 2017, according to Zillow data. More than a decade of limited housing supply has combined with rising tech payrolls to keep homeownership out of reach for many.
Wilson supports additional protections for renters, adding 4,000 units of emergency housing and a $1 billion city bond to build affordable housing, although a similar proposal at the county level has run into hurdles. Harrell has said that some of her proposals are unrealistic and could actually contribute to the housing shortage.
Wilson has been more cautious than Mamdani about making bold campaign promises such as the New Yorker’s pledge to make city buses free. Wilson, who leads an advocacy group for public transit riders, said she’d rather not forgo fare revenue subsidized by some of the same large employers she would like to tax.
Oxford Dropout
The daughter of two academic biologists, she studied physics and philosophy at Oxford University but dropped out just weeks shy of completing her degree. In Seattle, she worked on construction crews.
She also worked on local campaigns to raise the minimum wage, expand renter protections and pass the local payroll expense tax — known as JumpStart but unofficially dubbed the “Amazon tax” — on companies with high-earning employees. While Mamdani introduces himself as a democratic socialist, Wilson says she’s fine being called a Democrat or a socialist but adds that her career didn’t grow out of a political party.
“When people ask me to label myself, it just feels a little bit weird,” Wilson said. “The work that I’ve done over the years has always been very focused on quality of life, often cost-of-living issues that affect just regular people.”
Wilson acknowledged that the tax played into Amazon’s decision to shift headcount out of Seattle , but she said it has been a successful revenue source and she’s “not saying no to turning the dials” on it. The Jumpstart levy brought in $360 million last year, $47 million less than forecast. An advisory task force Wilson was a part of in 2023 said 70% of that revenue comes from just 10 companies, and that concentration can make it more volatile.
Business Anxiety
As in New York with Mamdani, Wilson jolted the Seattle business community with a strong showing in the August primary, when she got more than half the vote in the nonpartisan election. Companies in Washington were just digesting a record tax increase from state legislators earlier this year that for some industries will change how — or if — firms continue operating in Washington State .
It’s the accumulation of taxes and regulations that makes it harder to attract and grow companies, according to Rachel Smith , the former head of the Seattle Chamber of Commerce and incoming leader of the Washington Roundtable, a group comprised of leaders from major companies.
“I don’t think most businesses, frankly, or wealthy individuals, make their decisions based on a single thing,” Smith said. “They’re constantly assessing the environment in which they are operating and determining if they can be successful in it.”
The city council could also get an overhaul after the November election. Council President Sara Nelson is facing a stiff challenge from a labor-backed candidate in a race that could tip the ideological balance back toward the more progressive policies of the past.
Seattle voters are hard on incumbents: The city hasn’t reelected a mayor in two decades. But Harrell is making a case for continuity and warned about reading too much into the results of a low-turnout primary. Following a close primary in 2021, he won the general election handily as more voters returned their ballots.
Harrell has touted his record of hiring more police officers, cleaning up downtown and reducing drug overdose deaths, although he recognizes that Seattle needs to do more to connect people suffering from homelessness, addiction and mental health crises with the appropriate services.
Wilson earlier this year refined her message on public safety and homelessness, recognizing that progressive proposals have failed to resonate with many Seattle voters who want to take their kids to a park without tent encampments and companies that want employees to feel safe in downtown offices.
She says she would expand some of Harrell’s initiatives like rezoning residential areas to allow for more density and staffing a crisis response team that can be deployed to emergency calls instead of armed police officers.
In other words, while her tax goals have roiled the business community, Wilson said she sees plenty of potential common ground.
“Taxes are one issue where I’m sure that there’s anxiety, but what I will say is that there are other issues where I think that we are very aligned,” Wilson said. “It’s all going to be a balancing act.”
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