Tuesday afternoon, the Seattle City Council’s Budget Chair, Teresa Mosqueda, unveiled her “balancing package” of amendments to Mayor Jenny Durkan’s proposed 2022 city budget. Mosqueda’s modifications seem to be making no one happy — with the possible exception of the powerful Seattle pickleball lobby.
There are 133 individual items in the package, a slight paring down from the 190 amendments offered by the nine councilmembers two weeks ago. Mosqueda’s task in building her balancing package was to find the subset of amendments that would keep the budget in balance given available revenues but retain consensus support within the council. Mosqueda had a few other goals too, including shifting money around to ensure that the budget meets the letter of the spending plan attached to her signature “Jump Start” payroll tax.
As SCC Insight reported Tuesday, last week the City Budget Office delivered to the council updated revenue forecasts for 2021 and 2022. That update forecast a General Fund net revenue decrease of $14.2 million this year, offset by a net revenue increase of $12.8 million in restricted-use funds — including $18.6 million in Real Estate Excise Tax (REET) funds that can be used for some transportation, parks, and affordable housing projects. The report also predicted a $4.9 million reduction in general fund revenues next year, more than offset by $6.2 million of restricted-use funds.
First of all, the general fund revenue shortfall is not a major problem in itself; $14.2 million is 0.8% of the General Fund portion of the budget (and a much smaller fraction of the entire $7 billion budget). But the city budget pros are expert at “dollar swaps”: finding General Fund dollars that can be freed up by substituting restricted-use funds where allowed. And Mosqueda had no problem doing exactly that in her balancing package, using the extra REET dollars and making swaps mostly in the transportation budget. Nevertheless, in a speech outlining her balancing package and in her press release, she repeatedly blamed last week’s revenue forecast as the reason why the council can’t fund all of its priorities. That is mostly false, with one nugget of truth underneath.
The City Budget Office makes three forecasts: baseline, optimistic, and pessimistic. During most of the COVID pandemic, it has been using the pessimistic forecast to guide spending, but this past August when the economy was showing strong signs of recovery it switched back to the baseline forecast. To their credit, some councilmembers questioned at the time whether that was prudent given ongoing uncertainties with COVID. Since then the rise of the Delta variant and the subsequent delaying of corporate employees’ return to work led to a revision down of the city’s revenue forecast for both the payroll tax and the commercial parking tax — and the $14.2 million drop in projected general fund revenues.
But we need to put this into perspective: the baseline revenue forecast was essentially right. A 0.8% variance is well within the reasonable accuracy range for a revenue forecast. And that belies Mosqueda’s real complaint: her problem isn’t that she needed to cover for a small revenue shortfall (she easily did), rather it’s that she didn’t get a revenue windfall in the November forecast that would allow her to pay for some of the councilmembers’ budget amendments.
If the city had continued to use the pessimistic forecast through the fall, Mayor Durkan’s proposed balanced budget would have had lower spending, and the November revised forecast would have come in much higher than August’s. But because the August revenue forecast was close to the mark, Mosqueda got no extra money to spread around. That means that if she and her colleagues want to spend more, they need to create new revenues, cut spending on other items, or both. Mosqueda’s complaint is not that the August revenue forecast was wrong; it’s that the forecast was very accurate when she wanted it to be wrong.
The councilmembers do propose to raise the commercial parking tax rate to 14.5%, a fairly minimal increase. But most of the additional spending in the balancing package comes from spending cuts. The single biggest chunk is the $47 million that she claws back from the Mayor’s proposal for funding participatory budgeting, the Equitable Communities Initiative, and some other programs focused on investments in community-based alternatives to policing. Mayor Durkan proposed $124 million for such programs, including $54 million in carryover of unspent funds from 2021. Mosqueda is cutting that spending back to $77 million, including the $54 million carried over.
The balancing package also makes about $10 million of cuts to SPD’s budget:
- $4.53 million from a combination of salary savings and unspecified “efficiency savings” that the Council wants the department to find;
- $1.3 million by cutting the proposed 6-person expansion of the popular, civilian-based Community Service Officer program;
- $1.09 million proposed for a hiring-incentive program for sworn officers;
- $1.24 million for two proposed technology projects;
- $2.7 million in additional salary savings. The councilmembers are assuming that attrition in 2022 will be 125 officers, instead of the 94 in SPD’s staffing plan, and thus the department will need less money for salaries. This is controversial for two reasons. First, this undermines the councilmembers’ frequent refrain that they are fully funding SPD’s staffing plan; this time they are definitely not doing that. Second, the switch from 94 to 125 is convenient and not at all coincidental: by matching the attrition to the planned number of hires (125), the council can defend itself from the criticism of activists looking to downsize the police department by claiming that council is not allowing SPD to grow next year.
With that $57 million of cuts in hand, Mosqueda then chose a set of amendments to fund. There are a few areas of concentration where amendments were fully funded, including a $100 million bond for bridge major maintenance projects (with debt service covered by REET); transportation projects spread around the city and championed by district-based councilmembers; cleanup and remediation efforts related to homeless encampments in parks and on SDOT-managed properties; tiny home villages, including some upgrades to existing sites; and food assistance programs (many of which are earmarked by councilmembers for specific human service organizations).
But many of the amendments included by Mosqueda got significant reductions from their original funding requests:
- the Regional Homeless Authority got its $600,000 for administrative expenses, but only $5 million of the $19.4 million it requested for a 150-bed “high acuity” shelter downtown, and none of the $7.6 million it wanted for a new “peer navigator” program;
- the LEAD program, which councilmembers wanted to expand by $14.6 million to be able to take pre-arrest diversion referrals from across the entire city, only got an additional $3.5 million;
- earmarks for several other homeless-response and human services programs, which are getting a fraction of their original requests;
- affordable housing, which saw a handful of small amendments funded but the multi-million-dollar amendments rejected;
- several amendments related to increasing the city’s investments in mental health services, where nearly $50 million in requests earned just under $4 million in funding;
- parks projects, where some smaller projects championed by district-based councilmembers sneaked through but projects with larger price tags didn’t survive.
A few other notable amendments that made it into Mosqueda’s balancing package:
- $50,000 to add pickleball lines to 25 tennis courts managed by the Parks Department;
- $5.6 million for a one-time increase to wages for the the employees of human services providers contracting with the city;
- $200,000 to start building a Guaranteed Basic Income program;
- $99,000 for Seattle Public Libraries for hotspot devices;
- $545,000 to staff up the Office of Planning and Community Development to start preparing for the 2024 major update to the Comprehensive Plan;
- $200,000 for redesign of Lake Washington Boulevard;
- $1.5 million to the Fire Department for 20 additional recruits;
- $171,000 to fund an after-school program for resettled children living at or near Magnuson Park.
It didn’t take long after Mosqueda’s speech for Mayor Durkan, Mayor-elect Bruce Harrell, and the Downtown Seattle Association to issue press statements decrying the cuts to SPD’s budget. Here is Durkan’s statement:
“After last week’s election results delivered a clear rejection of the City Council’s plans to defund SPD, I was hopeful the Council would listen to voters and address our public safety needs with a real plan. Instead, it’s déjà vu all over again with Council proposing one of the largest cuts to public safety to date.
“City’s Council’s previous promise to defund SPD by 50%, their treatment of Chief Best and their previous layoff budget led to an exodus of 325 officers from SPD in the last two years. Multiple plans to address hiring and retention proposed by Chief Diaz and I have been repeatedly rejected by a majority of Council. And just yesterday, another Councilmember proposed blocking my emergency hiring proposal that has already generated a tenfold increase in applications to 911 dispatch positions in Seattle. Continued cuts to SPD and underfunding the 911 center are not a plan for true public safety.
“We need alternatives to armed police responses, and we have significantly ramped up these alternatives. My budget invests tens of millions in those alternatives like the successful community service officer program, HealthOne, the new triage team, and community-led gun violence prevention programs. But when someone calls 911 with a dangerous, potentially life-threatening emergency — we need enough police officers to respond.
“Seattle voters have made clear they expect Council to fund public safety and invest in community. I hope City Council make significant changes to their proposed budget in the coming weeks to protect public safety and community investments.”
Mayor-elect Harrell also invoked last week’s election results:
“The City Council needs to listen to voters’ desire for immediate investments in public safety and reverse the proposed $10 million cut to the SPD budget. Proposing further cuts deprives the City of resources needed to achieve national best practice staffing levels, decrease response times, and hire and train desperately needed officers – and is in direct conflict with what Seattle voters demanded just last week. It also delays our ability to develop and deploy a new kind of community-based, unarmed officer who will not carry a badge and gun. Overall, we need more, not fewer, public safety resources.
“Last Tuesday, the voters of Seattle resoundingly and unambiguously rejected defunding the police. Our campaign expressed a clear message and commitment: We must deliver true community safety, ensure unbiased policing, and decrease length of response times by improving training, hiring more and better officers, creating unarmed and alternative responses, and changing the culture within SPD. That vision and those goals for improvement and reform cannot be achieved with this proposed $10 million cut.”
While the DSA criticized both the SPD cuts and the decision not to fund the Regional Homeless Authority’s large requests:
“Seattle City Council Budget Chair Teresa Mosqueda is ignoring voter sentiment that rang loud and clear in last week’s election in her proposal to cut millions in SPD funding and stand in the way of addressing homelessness downtown. This is a tone-deaf budget proposal that will negatively impact community safety, leave more people on the streets to suffer and slow economic recovery. Seattle voters overwhelmingly identified public safety and chronic homelessness as the most critical issues facing our city and they want elected leaders to prioritize city spending on plans and solutions that deliver results. Councilmember Mosqueda’s response to those pleas is to cut SPD’s budget by more than $10 million and deny funding for the King County Regional Homelessness Authority’s plan to address the crisis of homelessness downtown. Nearly 800 people live unsheltered in the center city, with an estimated 150 of those having high-acuity needs. This budget proposal fails to address Seattle’s most pressing concerns and will exacerbate existing problems. This is more business as usual from the City Council and Seattleites deserve far better.”
Mosqueda will present her balancing package to her colleagues Wednesday morning at 9 am. This evening at 5:30, the council will hold another public hearing on the 2022 budget; signups open at 3:30. Friday the council will have a longer discussion of the balancing package and possible second-round amendments to be offered next week.
This article first appeared on SCCInsight, sccinsight.com.
Check out the Parks Dept budget. It’s loaded with huge new Adminstrative spending. Be wary of pols putting on the poor mouth.
Echoing Casey’s point: It’s helpful to know which departments the mayor’s office uses to stash extra employees, off the executive budget. City Light used to specialize in this kind of legerdemain, as did Parks. Padding can also be a sign of weak departmental leadership. One of the biggest city hall departments is a surprise: Seattle Center.