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Uber, Lyft tax sets stage for showdown between mayor and Seattle council

A tax on Uber and Lyft could set Seattle up for a showdown in the days ahead. (Justin Sullivan/Getty Images)

Seattle City Council approved the 2020 budget late Monday. Included in that budget was a potentially controversial tax on Uber and Lyft, that could set the city up for a showdown in the days ahead.

Seattle council approves 2020 budget

The 57-cent tax was originally pitched by Mayor Jenny Durkan, almost tripling an existing 24-cent tax on rideshare companies. The increased tax is expected to bring in $25 million a year for things like affordable housing, transit, and the creation of a driver resource center for rideshare drivers.

The hope is that it will also help relieve congestion in downtown Seattle. The mayor’s office had previously noted that Uber and Lyft had 24 million rides in Seattle last year, half of which either started or ended downtown. It claims those vehicles add to congestion when they are circling or idling downtown, slowing down buses and clogging streets.

Uber issued a statement in opposition to the tax shortly after it was given the go-ahead by Seattle City Council.

“Seattle’s new tax will most impact those who rely on rideshare as an affordable and reliable transportation option, as well as the thousands of drivers who earn income from rideshare,” the company said.

A different showdown could also be on the horizon, this time between Mayor Durkan’s office and Seattle City Council. Durkan’s original proposal for the rideshare tax focused mainly on funding the 1st Avenue Streetcar, currently staring down a significant budget shortfall.

Seattle’s plan to triple the rideshare tax on Uber, Lyft

The total estimate for the cost of the streetcar project is $286 million. That was double the original estimate from when the line was proposed in 2015, and $88 million more than what was budgeted in 2017. That estimate also included nearly $17 million dollars to retrofit the existing tracks to fit the larger train cars ordered for the expansion.

Durkan hoped to have funding from the rideshare tax make up that difference. Seattle council widened the scope in its own version of the budget to include transit and housing. That draft would potentially include anything from a light rail tunnel connecting West Seattle and Ballard, to a voucher program for seniors and disabled riders for transit.

According to The Seattle Times, Durkan remains “committed to fully funding the streetcar,” setting the stage for a potential tug-of-war with Seattle City Council in the days ahead.

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