King County Elections commenced mailing ballots on Wednesday, presenting Seattle voters with a significant decision regarding funding for a new model of affordable housing. The first item on the ballot asks residents to support the Seattle Social Housing Developer (SSHD), a public development authority established by the passage of Initiative 135 two years ago. The SSHD focuses on social housing, which is publicly owned and permanently affordable, catering to various income levels. This model allows the SSHD to accommodate tenants with extremely low incomes without relying on government subsidies.
To implement its plans, the SSHD will utilize government funds, with construction and maintenance costs covered by government bonds. However, the SSHD currently lacks a designated funding source, prompting the second question on the ballot. Voters will need to choose between Proposition 1A and Proposition 1B to establish a revenue stream.
Proposition 1A proposes a new payroll tax on employers, imposing a 5% tax on annual compensation exceeding $1 million paid to any employee in Seattle. This proposition could generate up to $50 million in its first year, providing a long-term funding source for future social housing projects while granting the SSHD greater autonomy to serve a wider range of income levels.
On the other hand, Proposition 1B, put forth by the Seattle City Council, suggests using funds from the existing JumpStart payroll tax. This option would generate approximately $10 million annually for about five years, focusing on developments that serve lower-income residents. Under this scenario, the SSHD would need to apply for funding and adhere to conditions set by the Seattle Office of Housing. However, diverting $10 million each year from the JumpStart tax would reduce the funds available for nonprofits competing for new housing projects.
Critics argue that the campaign to pass Initiative 135 presented Seattle’s social housing model as “self-financing” without government subsidies, calling the current request for $50 million in new taxes a form of bait-and-switch. Tiffani McCoy, co-executive director of House Our Neighbors, emphasized that this vote builds on the foundation established by Initiative 135 and paves the way for the construction of housing that will remain publicly owned indefinitely
