(The Center Square) – Seattle council members appeared skeptical about Mayor Katie Wilson’s plan to balance a $175 million hole Tuesday as the city council considered whether her budget is sustainable long-term.
The Seattle City Council dug into the $9.1 billion citywide proposal for 2027 Tuesday, which reduces an estimated $175 million general fund deficit to roughly $23 million. Minor deficits continue through 2029. Some officials worry the projections look too “rosy” and could unravel if the economy shifts.
For example, if revenue growth falls short of assumptions, or costs rise faster than expected, it could upend the self-described socialist mayor’s budget, requiring additional cuts to offset that imbalance.
“This is a key concern for me,” Councilman Robert Kettle said, warning that sudden changes in the economy could throw off the plan and citing ongoing global conflicts and their impact on inflation.
Council staff briefed the officials Tuesday, running through various account transfers and inflationary adjustments that reduce the roughly $175 million deficit for 2027 by about $90.1 million. Wilson’s plan frees up another $60 million, largely with transfers to the JumpStart fund, leaving a $23.3 million gap.
The administration proposed a similar strategy for 2028, which has a projected deficit of $164 million.
Seattle Metro Chamber President Joe Nguyen told The Center Square that Wilson’s proposal makes progress on addressing the deficit, but said it’s not perfect. The transfers, spending reductions and other measures help significantly, but doubts remain as to whether the deficit will be gone for good.
“The easiest thing is (to) create an environment (where) people want to actually be in Seattle and do business, and that would plug that gap pretty quickly,” Nguyen said Tuesday when asked about Wilson’s first budget.
During Tuesday’s meeting, Councilwoman Maritza Rivera, vice chair of the Select Budget Committee, doubted whether the city can fully address the deficit given constant inflation. She said the situation may improve under this budget but suggested that the city could hover around a $10 million deficit.
“We’re never going to be in a nondeficit situation, per se, because we’ll always have to manage the inflation,” Rivera said as council budget analysts noted inflation is accounted for but could change.
Councilman Dan Strauss, chair of the budget committee, said Seattle isn’t alone, comparing the Emerald City to jurisdictions statewide. He criticized the state’s 1% cap on annual property tax increases, a voter-approved measure, and emphasized the need to focus on Seattle’s construction budget.
Attracting more taxpayers and businesses could ease the pain, but the Seattle Metro Chamber’s Index 11 report, released Tuesday, says the city is heading in the wrong direction. Most of the 700 voters polled cited growing distrust in city leadership to spend their tax dollars responsibly.
“Six-in-ten voters now believe that taxes in Seattle are too high for the level of services provided and two-thirds do not trust the City to be fiscally responsible with their tax dollars,” according to Tuesday’s Index 11 report. “Trust on spending is down a net 16 points from last May. Eight-in-ten Seattle voters support requiring the City to demonstrate that existing spending is working before increasing taxes.”
The mayor’s 2027 budget proposal claims to reduce annual general fund spending by roughly $50 million. The fund accounts for about $2 billion of the citywide budget and acts as an indicator of overall financial health, financing public safety and day-to-day government functions, among other services.
Despite claiming to cut general fund spending and end a cycle of recurring deficits, Wilson’s proposal ultimately increases citywide and general fund spending with a deficit still slated for 2029. That assumption also relies on future cuts and transfers between the general fund, JumpStart Fund and more.
One way Wilson intends to trim the budget is by reducing staff, which makes up a considerable portion of the general fund. Her budget includes plans to cut 128 full-time positions, of which only 13 or 15 are currently filled; however, total full-time equivalent staff is expected to rise by nearly 100 FTEs.
The council expects to receive another revenue forecast later this week.
As Strauss was leaving the meeting on Tuesday, The Center Square asked whether he thinks Wilson’s plan will meaningfully address the deficit or leave a major gap if her assumptions don’t come to fruition.
“We’ll know more information on Friday with the revenue forecast,” Strauss said.