BUDGET REVISION AGREEMENT

On Monday, March 29, the Council voted 8 to 1 (Steinbrueck voting no) to adopt an ordinance cutting $9.3 million from the 2004 budget to comply with a Supreme Court decision requiring the City's General Fund (rather than City Light) to cover the costs of street lighting. Although City Light was initially chartered to provide street lighting, the Court ruled that taxpayers, rather than ratepayers, should pay for it, because it is a collective, rather than individual, service. Since taxpayers and ratepayers are generally the same people, few will really benefit from this decision.

The Court decision was made just before final Council adoption of the budget last November. Rather than make hurried cuts to comply, the Council chose to temporarily fill the gap from the City's Emergency Fund, and to revisit the budget early this year.

Anticipating the need for cuts, Mayor Nickels froze some City expenditures, including all changes that the Council made to his original budget. While the Council strongly disagreed with his decision to do so, it is clearly within his authority. The Council can prevent the Mayor from spending money on particular items, but cannot compel the Mayor to spend money.

Fortunately, after this rocky start, discussions proceeded in more positively, and the Mayor agreed to meet with several Councilmembers to seek consensus on a plan for budget revisions. The Mayor agreed to release the funds for any programs that the group decided to keep in the 2004.

All Councilmembers endorsed this process, and the group met for many hours during February and March, with both Executive and Council staff providing technical and policy analysis of possible reductions. All Councilmembers not in the negotiating group were briefed and consulted with during the process.

While every cut is painful, each one was carefully considered, with advice from the affected Department. Somewhat to everyone's surprise, the negotiators were able to come to an compromise, saving many key programs considered for cuts.

Programs saved include:

• The entire school crossing guard program
• All remaining Community Service Officers, who provide crucial services in low income neighborhoods
• The Sharehouse program, which provides furniture for families moving out of homelessness
• The Protective Payee program of the Compass Center, which manages the money and safeguards the independence of low income mentally disabled persons
• The Domestic Violence Batterers Treatment program of the Asian Counseling and Referral Service
• $813,000 for Community Health Clinics
• The Street Outreach Worker component of the Capitol Hill Safety Initiative
• The Neighborhood Matching Fund, which had already taken cuts in the regular budget process
• Library service hours
• Late Night recreational programs at Community Centers
• The Master Home Environmentalist program, which addresses childhood asthma in low income households

  There were, of course, other programs cut, including some important Council initiatives. However, the Council did an excellent job of safeguarding critical human services: only $374,000 of the cut (less than 4%) came from human service programs, a lower cut than many other Departments.

  An amendment that would have re-added some $200,000 in human service programs failed, 7 to 2. Councilmembers recognized that we had negotiated a tough, but fair, agreement, and that approving such an amendment could potentially have put many more programs at risk. The Executive did not support the amendment, would most likely have refused to spend the money in the amendment, and might have chosen to continue to freeze other important programs as well.

  This agreement with the Executive was vital to releasing the several million dollars in funds for the important programs detailed above. Although it was difficult, it was a good and fair agreement, and I hope that the spirit of cooperation in this process will extend to the tough process of preparing the 2005-2006 budget this fall.

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  NUCOR FINAL VOTE

  On Monday, March 15, the Council voted 6 to 3 to approve the special electric rate for Nucor Steel. I joined Councilmembers Licata and Steinbrueck in opposing the proposal. I am very concerned that this unprecedented step of providing a subsidy for a particular company through the rate structure sets the City on a course that we will regret in the future. More background can be found in the previous two newsletters.

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  MULTI-FAMILY TAX EXEMPTION PROGRAM
  

  On Monday, March 15, the council adopted a revised version of the Multi Family Tax Exemption program (MFTE) by a vote of 6 (Conlin, Compton, Drago, Godden, Rasmussen, Steinbrueck) to 3 (Della, Licata, McIver).

  The MFTE provides a ten-year reduction in property taxes for new construction of multi-family units that are affordable to people earning between 60% and 70% of median income. The units must stay affordable at that income level for the ten-year life of the tax reduction. The program is designed to help create "workforce" housing, for people who do not qualify for subsidized low-income housing but who are often priced out of Seattle's housing market.

  This vote reestablishes the program, but does not automatically authorize any tax exemptions. The Council will have to approve each such exemption as projects are proposed. This provision and an annual review clause will allow the Council to effectively monitor the program and ensure that it is actually serving a public purpose and meeting real community needs.

  The previous MFTE program did not stimulate many new affordable housing units because it allowed tax exemptions for too broad a price range, did not appropriately require a range of unit sizes, and had a complex administrative structure. Thus, only a few buildings were granted exemptions, and an evaluation suggested that the program did not effectively meet its goal.

  The new program targets a narrow range of affordability, requires including a range of unit sizes in each building, and simplifies the administrative structure.

  While I have reservations about the potential effectiveness of the program, the new design addresses some deficiencies of the previous program, and can potentially stimulate housing production for people who would otherwise not be able to afford to live in the City. The review procedures allow us to pursue this experiment with limited risk.

  In previous resolutions, the Council had expressed concern about the availability of workforce housing in the University District, Northgate, and South Lake Union. It is important for the Council to follow up on its commitments to these neighborhoods and see if this tool is helpful.

  While some statistics indicate that the affordability range this program targets is currently being provided by the market, most new developments are more expensive. When the rental market tightens as the economy improves, the units provided under this program will not increase in rent, and will be available for ten years into the future. Since new units built under this program will not come on line for at least a year or two, this program may be timed appropriately to help moderate the impacts of future decreases in affordability.

  Finally, and because of factors like those noted above, the proposal was endorsed by a coalition of low income housing providers, labor unions, and environmental organizations. These organizations indicated that they do believe that this will potentially provide an important addition to our affordable housing supply.

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  QUOTE:
  "Living things evolve in variety, resilience, and intelligence; they do this not by erecting walls of defense and closing off from their environment, but by opening more widely to the currents of matter-energy and information. They integrate and differentiate through constant interaction, spinning more intricate connection and flexible strategies. For this they require not invulnerability, but increasing responsiveness. Such is the direction of evolution."
  
  -- Joanna Macy

  DEEP THOUGHT:
  "Life is not lost by dying, life is lost minute by minute, day by dragging day, in all the thousand small uncaring ways."
  
  -- Stephen Vincent Benet

  Citizen participation and engagement are critical for maintaining democracy -- fostering it is a key task of elected officials. It's my hope that this newsletter will inform you about issues, inspire you to get involved, and that together we can make things work better in this great city. Please send me your feedback, so we can keep things lively, interesting, and useful. And please forward it along to friends who might be interested.

  Richard Conlin
  Your Seattle City Councilmember
  
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