The Seattle city council has passed a new plan which aims to combat homelessness by increasing business tax on huge firms such as Amazon and Starbucks to fund affordable housing and homeless services. In response, Amazon's vice president said this move "forces us to question our growth here". Under the amendment, the tax expires after five years with the option to renew it. Kshama Sawant was the only councilmember to vote against the amendment, but voted in support of the final tax after the smaller version was approved by her colleagues.
The compromise failed to defuse tensions between Amazon and the city it has called home for the last 24 years.
The original bill was sponsored by four council members: Gonzalez, Teresa Mosqueda, Lisa Herbold, and Mike O'Brien. Despite this, the mayor of Mountain View, California has proposed a head tax similar to the one passed in Seattle, and San Jose, Sunnyvale, and Redwood City have all added them in recent years.
While Amazon has resumed construction planning on the downtown building, company officials "remain apprehensive about the future created by the council's hostile approach and rhetoric toward larger businesses, which forces us to question our growth here", said Drew Herdener, Amazon's vice president for global corporate and operations communications. The firm posted net revenue of $177.8 billion Dollars in 2017. The Council estimates the tax will raise roughly $47 million a year on average.
Chelminiak said that he is not aware of any businesses changing their plans in the region as a result of Seattle's new head tax.
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And Starbucks said: "This City continues to spend without reforming and fail without accountability".
Boston, of course, also is considered a strong contender for Amazon's so-called second headquarters, an $8 billion, 50,000-job campus.
"We have to massively scale up the number of deeply affordable housing units that are available to those that are living and suffering here on the streets of Seattle", she said.
Amazon wasn't the only company left grumbling.
The tax proposal represents a compromise between city council members who aimed much higher-$500 per employee to raise $75 million-and their colleagues who believed the initially proposed rate would be too costly for businesses.
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Bezos also halted two construction projects in Seattle pending the outcome of the head-tax debate, which Sawant called extortion. The number of homeless students in the city's public schools has tripled, to almost 4,300 last school year.
Seattle is battling skyrocketing housing prices and homelessness.
In business-friendly Texas, University of North Texas Economist Dr. Michael Carroll says cities have to be careful not to lose the golden goose.
Amazon now lists 5,551 job openings in Seattle.
Outside of Seattle, King County's 2018 budget for homelessness spending was $66.9 million, which includes funding for emergency shelter, prevention, supportive housing, rapid re-housing, transitional housing, and other homeless housing programs and supportive services.
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