‘We are the Cape Canaveral of launching task forces’: KIRO hosts reacts as study exposes Seattle’s big tech dependency

A new independent economic assessment of Seattle’s finances arrived this week, and the city’s response drew immediate ridicule from KIRO fill-in host Mike Lewis.

Lewis had a message after Seattle Mayor Katie Wilson signed an executive order creating the Resilient Seattle Economy Task Force.

“We are the Cape Canaveral of launching task forces,” Lewis said on “The John Curley Show” on KIRO Newsradio. “We will launch a task force with virtually no provocation from the public. We are a task force city.”

All eggs in the JumpStart basket

The report was produced by the economic consulting firm Formation and commissioned by the Seattle Office of Economic Development. It concluded Seattle is dangerously reliant on a handful of large tech employers to fund its budget, particularly through the city’s JumpStart payroll tax. The tax targets companies with payrolls above roughly $9 million, and is projected to raise approximately $500 million this year.

Lewis pointed out that Seattle depends heavily on about 10 companies to fund its business payroll taxes, which sets it apart from comparable cities like San Francisco, Boston and Minneapolis, which draw more evenly from mid-size businesses.

“When there is a big company, let’s just say something that rhymes with Slamazon, when this company sheds 5,000 employees, that is millions and millions of dollars in payroll taxes,” Lewis said. “We’re disproportionately dependent on the company that had 50,000 employees at one time in downtown Seattle.”

Lewis also called out Seattle City Council member Dan Strauss by name.

“Council member Dan Strauss, we’re calling you out specifically,” he said, noting that Strauss championed the move to allow JumpStart revenue to flow into the general fund rather than remain dedicated to affordable housing.

The silver lining nobody can say out loud

What does a slowing economy actually mean for ordinary Seattleites? KIRO host Spike O’Neill noted the standard concerns: less revenue, operating deficits, and threats to public safety funding. Lewis argued the picture is more nuanced than leaders can publicly admit.

“When you start seeing ‘one month free’ banners for new tenants … we didn’t see those for a long time in Seattle. They are everywhere now,” Lewis said. “There are elements of a slowing economy that actually are the city’s best friend, and one of those things is that housing becomes much more affordable.”

He acknowledged no mayor can celebrate an economic downturn, but pointed out moderate-income earners will see a silver lining.

“You want to know what drives rent down? When you have choices,” Lewis said. “Your landlord knows you’ve got choices now.”

The small business paradox

Spike raised the issue of vacant retail and office space as an opportunity for the small businesses the mayor says she wants to cultivate. Lewis was skeptical.

“Seattle has tried to do a variety of measures, most of them pretty poorly thought out, on how to preserve small businesses,” Lewis said.

He believes property values are so high that first-floor retail spaces are only affordable for chains and heavily capitalized restaurants.

“You’re not replacing them with the same small businesses,” he said. “You’re replacing them with a Subway, maybe a Domino’s Pizza, some sort of fancy restaurant, maybe more Pilates.”

Lewis added that when former Mayor Bruce Harrell cut some business and occupation taxes, the savings for his own business came to about $300 a year.

“I’ll take the $300,” he said. “I think that’s great, but that’s not a deal maker.”

Public safety and the open letter

The economic conversation shifted to public safety, as more than 30 major Seattle employers sent an open letter this week to Mayor Wilson and the City Council demanding a 100-day public safety action plan. The letter calls for activating CCTV cameras, increasing foot and bike patrols, faster 911 response times, and accountability for public drug use.

Spike argued that economic viability and public safety are inseparable.

“Part of making Seattle financially and economically viable in the future moving forward is to create a city where not just businesses can thrive, but citizens can live, thrive, and feel safe,” he said.

Lewis said the overlap between a fragile economy and a fraying public safety infrastructure is the biggest challenge for Seattle’s leaders, ideally without another task force.

Watch the full discussion in the video above.

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