For the past month, Seattle councilmembers have been deliberating, reviewing and revising (when necessary) the city’s 2025-2026 budget. Those nine councilmembers are deciding how to spend taxpayers’ money, the most important work they do all year.
As in most years, the job is no easy task. Seattle is not flush with revenue; in fact there is a $150 million gap between expected city revenue and expenditures. The mayor, as usual, had first crack at crafting a budget – one that is balanced because, unlike federal budgets, the city budget can’t use deficit financing.
Mayor Harrell’s budget proposal solved the shortfall problem by taking $287 million from an expected windfall of Jump Start payroll tax receipts. A previous council passed the payroll tax in 2020, restricting use of the revenue to affordable housing and helping small businesses. However, that law included a provision that allows Jump Start receipts to be diverted in the event of a budget shortfall, something that so far has been an annual occurrence.
The mayor’s $8.3 billion budget allocates $400 million more than the city’s 2024 budget. His version breaks down this way:
Despite calls from 35 local service providers and labor leaders who urged passage of new progressive taxes, Harrell ruled out seeking new revenue. By making use of the Jump Start overage, he managed to avoid deep cuts to city services. He did propose eliminating 159 positions, but about half of those positions are empty due to an earlier hiring freeze.
Somehow, despite the tight budget, Harrell was able to find funds for a couple of his favored projects including upgrading Westlake Plaza in time for the 2026 World Cup and the addition of 11 new employees for his Unified Care Team, which clears away illegal encampments. He proposed investing 10 percent of the Jump Start overage in a $43 million reserve fund.
Harrell made one politically prudent move; he left a small pot of money unprogrammed to give councilmembers a modest opportunity to include their favored projects. As former councilman Richard McIver once observed, “A tight budget is one that can’t cover every councilmember’s pet project.”
In eliminating 159 positions – not a large reduction in a city with 10,000 employees — Harrell targeted jobs in Human Resources, info tech, finance and administration, and construction and land use inspection.
The loudest protest over Harrell’s proposed budget so far has been opposition to his appropriation of the Jump Start windfall. The city’s October 16 public hearing was dominated by testimony objecting to Jump Start funds being diverted from affordable housing and social service needs. Instead, extra Jump Start receipts seemingly would make possible increased police spending.
There also has been considerable concern over the mayor’s proposal to eviscerate the Seattle Channel, including axing the “City Inside/Out” public affairs program, laying off staff, and eliminating Nancy Guppy’s “Art Zone” and Librarian Nancy Pearl’s “Book Lust.” The short-sighted plan immediately drew criticism from open-government advocates and media groups like the Society of Professional Journalists.
The mayor blamed the cutback on dwindling franchise fees received from cable providers Comcast and Wave. However, the mayor’s decision – which would save a mere $1.6 million out of an $8.3 billion budget – hasn’t set well with Seattle Channel’s supporters including Council President Sara Nelson. In her newsletter, Nelson called the channel “a critical public service, supporting the arts, government transparency and civic life in Seattle.” She has already introduced an amendment to restore the channel’s funding.
The good news is that it’s not too late for the public to have a say in how the city budgets taxpayer money. There will be one final public hearing on Tuesday, Nov. 12. That’s an opportunity to speak out – either in person or remotely. The council will then take final votes on Nov. 19, with passage of the 2025-26 budget scheduled for Nov. 21. Meanwhile, the public can contact individual councilmembers directly by phone or email. They can reach all nine councilmembers by email at council@seattle.gov.
As President Joe Biden once declared, “Don’t tell me what you value. Show me your budget and I’ll tell you what you value.”
It would seem to be extremely important to not only restore all the Seattle Department of Construct and Inspections (SDCI) positions, but to ADD more. SDCI is currently a mess; it takes forever to get a response, it takes longer to get a permit, and that this is happening when we have a housing crisis is insane. But let’s also remember that, when the “Missing Middle” Housing Bill, HB 1110 which passed in 2023), and the new Comprehensive Plan go into effect in January, and the minimum lot size drops to 1,250 square feet in order to spur lot divisions and build tens of thousands of new homes, townhouses, and apartments, that will flood SDCI! If we want more housing, we need more people to process all the work it takes to do that
Or we could attempt to simplify the codes. But people like the complex codes ….. yes we can argue about that, but I think you’ll find out that if there is such a thing as the “will of the people”than the will of the people is to demand more and more regulation.
The practical response to your suggestion (that we need to speed up the permit process) is to raise permit fees… All of which are paid for by developers, and of course users, buyers and renters. That’s what government likes: to have somebody else pay for its own benefits.
Do you really think those “missing middle” changes to the laws will cause housing prices to fall? Developers want to make money, not increase supply to drive down their profits. Home builders now can not profitably borrow to build on spec in Seattle. Any new demand from developers entering the market next year just would drive up prices further. Construction costs are much higher now (supplies and labor costs inflated way above where they were in the good old days). Also, the demand for new tiny sfd’s, townhomes, and 6-plex units in an increasingly undesirable place like Seattle likely would be weak. The population of the well off is shrinking and new arrivals are marginally employed (if they even have jobs). Seattle became undesirable compared to how things were here in terms of housing demand because the new employment outlook is bleak, schools are underperforming, gun and drug crimes are up, and the costs of living are high.
I am conflicted on whether the Missing Middle Housing Bill will cause rents or house prices to fall. Part of the huge housing problem throughout the US is that there were so few new housing units built after the Great Recession. In places like Seattle, which was largely unaffected by that event (other than the slowdown in housing construction), tens of thousands of new people flooded into our area. The many jobs created weren’t for people who already live here, and the flood caused harm to those people when rents and housing prices skyrocketed. In other words, way too much demand for too little supply. Remedial economics. When more housing is constructed to meet demand, rental prices can at least stabilize. We have already witnessed some of that in some parts of town.
That said, you are correct that many developers aren’t aiming for the “affordable” (60-80% AMI) market. It takes government incentives for that, and even more for the construction of “low income” (below 60% AMI) apartments.
But with housing construction, someone buying out a single-family home on a standard 5,000 square food lot could build 4 single-family homes (and, with a variance, even more townhouses, flats, or a condo building). Those houses will make the developer a profit and can be sold for more reasonable prices than the current system.
Despite your description of Seattle, demand to purchase homes is extreme. Each week, I receive more than 2 letters, 5 texts, and up to 20 phone calls from predatory cash buyers hoping to buy my old house. I have full confidence that the new houses that will be build on my property will be snatched up as soon as they go on the market.
You assume, though, that the upzone will cause more housing to be built. It won’t.
Seattle housing construction has been pretty robust for years. It isn’t guaranteed to continue, but not because they’re finally going to run out of lots to build on. Capital is a big part of it, and the other costs Ellen D. mentions, vs. the market and where they’re betting it will go. (They remember losing their shirts a little over a decade ago in a bubble.) The city wide upzone is just a sort of small scale urban sprawl, same number of multifamily units total but spread out instead of clustered around “urban villages.” Auto-oriented, etc.
Developers will profit in the short term as a whole lot of tear-down ready lots come on the market, so their investment in Olympia will pay off handsomely, but prices are demand driven, so there’s no need for them to think about passing their savings on to the buyer.