WARNING
Ordinance 94289 provides as follows:
Section 1. It is unlawful for any person:
1. To sign or decline to sign any petition for a City initiative, referendum, or Charter
amendment, in exchange for any consideration or gratuity or promise thereof; or
2. To give or offer any consideration or gratuity to anyone to induce him or her to sign or
not to sign a petition for a City initiative, referendum, or Charter amendment; or
3. To interfere with or attempt to interfere with the right of any voter to sign or not to sign
a petition for a City initiative, referendum, or Charter amendment by threat, intimidation
or any other corrupt means or practice; or
4. To sign a petition for a City initiative, referendum, or Charter amendment with any
other than his or her true name, or to knowingly sign more than one (1) petition for the
same initiative, referendum or Charter amendment measure, or to sign any such petition
knowing that he or she is not a registered voter of The City of Seattle.
Section 2. Any person violating any of the provisions of this ordinance shall upon
conviction thereof be punishable by a fine of not more than Five Hundred Dollars ($500)
or by imprisonment in the City Jail for a period not to exceed six (6) months, or by both
such fine and imprisonment.
INITIATIVE PETITION FOR SUBMISSION TO THE SEATTLE CITY COUNCIL
To the City Council of The City of Seattle:
We, the undersigned registered voters of The City of Seattle, State of Washington,
propose and ask for the enactment as an ordinance of the measure known as Initiative
Measure No. …… entitled “An Act to Tax Big Businesses to Fund Affordable Green
Housing the City of Seattle,” a full, true and correct copy of which is included herein,
and we petition the Council to enact said measure as an ordinance; and, if not enacted
within forty-five (45) days from the time of receipt thereof by the City Council, then to be
submitted to the qualified electors of The City of Seattle for approval or rejection at the
next regular election or at a special election in accordance with Article IV, Section 1 of
the City Charter; and each of us for himself or herself says: I have personally signed this
petition; I am a registered voter of The City of Seattle, State of Washington, and my
residence address is correctly stated.

1

 AN ACT to Tax Big Businesses to Fund
Affordable Green Housing in the City of Seattle.
BE IT ENACTED BY THE PEOPLE OF THE CITY OF SEATTLE:
A new Chapter 5.38 is added to the Seattle Municipal Code as follows:
Chapter 5.38 TAX ON CORPORATE PAYROLL FOR AFFORDABLE GREEN HOUSING
5.38.000 Findings and Resolution
Progressive revenues are urgently needed to address the deep affordable housing and
homelessness crisis affecting a growing number of people in the City of Seattle.
Average rents have risen 69% since 2010, far beyond the rate of inflation and more
than double the national average, so that now 46% of Seattle renters are officially rentburdened. Nationwide studies have shown that rising rent increases homelessness - on
average, in urban areas, each $100 increase in the average rent causes at least a 15%
increase in homelessness. Meanwhile, the global climate crisis represents a threat to
our city and humanity as a whole. The affordable housing and climate crises are deeply
intertwined, with Seattle’s carbon emissions dramatically exacerbated by the ongoing
process of rapid displacement and longer and longer commutes for workers. Yet, as the
needs of ordinary people go neglected, Seattle and King County are home to some of
the wealthiest corporations and individuals in the world, including Amazon and its CEO,
Jeff Bezos. Raising taxes on the biggest businesses in Seattle can provide funding for a
major expansion of affordable green housing as a step toward making Seattle
affordable, sustainable, and welcoming for all.
5.38.010 Administrative provisions
All of the provisions contained in Chapter 5.55 shall have full force and application with
respect to taxes imposed under the provisions of this Chapter 5.38 except as may be
expressly stated to the contrary herein.
5.38.020 Definitions
The definitions contained in Chapter 5.30 shall be fully applicable to this Chapter 5.38
except as may be expressly stated to the contrary herein. The following additional
definitions shall apply throughout this Chapter 5.38:
A. “Affordable Green Housing” means residential housing structures that are:
1. Publicly-owned or publicly-rent-controlled and set aside for households with
incomes between 0 and 100 percent of area median income (AMI);
2. Compliant with the following rent limitations:
a. For households earning between 0-30 AMI, monthly rent that is no greater
than 30% of the household’s monthly income;
2

 b. For households earning above 30 AMI up to and including 80 AMI,
monthly rent that is determined in accordance with the Seattle Office of
Housing’s annually-published Income and Rent Limits schedule for the
Rental Housing Program;
c. For households earning above 80 AMI up to and including 100 AMI, initial
monthly rent that is based on the cost of the individual housing unit
selected by the household, independent of the household’s income. The
Seattle Office of Housing shall either set, or create mandatory formulas for
property-owners to use in setting, the initial monthly rental rates for
housing units available to households in this AMI range at all properties
participating in the Affordable Green Housing program. Thereafter, any
annual total rent increases on such rental units shall be no greater than
the annual percentage increase in the wage component of the consumer
price index (CPI-W). In addition, all such rental units shall be subject to
vacancy control, such that when a rental unit becomes vacant or is
occupied by new tenants, the new tenants’ initial rental rate shall not
exceed the last tenants’ most recent rental rate; and
3. Compliant with efforts to reduce or offset the effects of climate change and global
warming, as recommended by the Green New Deal Oversight Board, pursuant to
Section 3.14.979.
B. “Business” has the same meaning as that term defined in SMC 5.30.020. Depending
on the context, “business” may also mean a person engaging in business in Seattle.
C. “Tax on corporate payroll” means the payroll expense tax imposed by this Chapter
5.38.
D. “Compensation” means remuneration as that term is defined in RCW 50A.05.010,
net distributions, or incentive payments, including guaranteed payments, whether based
on profit or otherwise, earned for services rendered or work performed, whether paid
directly or through an agent, and whether in cash or in property or the right to receive
property. “Compensation” does not include payments to an owner of a pass-through
entity that are not earned for services rendered or work performed, such as return of
capital, investment income, or other income from passive activities.
E. “Employee” means any person who performs work, labor, or personal services within
the City of Seattle for a business, whether or not that person is on the business’s
payroll. An employee’s work, labor, services, or personal services occur “within the City
of Seattle” for a given quarterly tax period if the employee either (a) performs 50 percent
or more of his or her duties within the City of Seattle during that quarter; or (b) is
assigned to work out of a business location in the City of Seattle during that quarter.
For purposes of this Chapter 5.38, the term “employee” also includes all full-time, parttime, and temporary employees or workers (regardless of whether they are referred
from an employment agency) on the business’s or the referring agency’s payroll,
3

 excluding only those workers who (A) are free from the control and direction of the
hiring entity in connection with the performance of the work, (B) perform work that is
outside the usual course of the hiring entity’s business, and (C) are customarily
engaged in an independently established trade, occupation or business.
Members of limited liability companies, professional limited liability companies, and
partners shall be considered employees.
F. “Employer” means any business which has one or more employees, or the
employer’s designee or any person acting in the interest of such employer.
G. “Net distribution” means the draws from net income by any owner of a pass-through
entity. Taxable distributions are limited by the amount of draws or net income for that
owner, whichever is less. If the owner’s draw exceeds that individual’s net profit, the
excess draw is a return of capital. A return of capital is not taxable because it is a
liquidation of an owner’s assets.
H. “Pass-through entity” includes a trust, partnership, corporation described in
Subchapter S of the Internal Revenue Code of 1986, as amended, limited liability
company, limited liability partnership, professional corporation, and any other person or
entity which is not subject to the income tax imposed by Subtitle A, Chapter 1 of the
Internal Revenue Code of 1986, as amended, or which is allowed a deduction in
computing such tax for distributions to the owners or beneficiaries of such person or
entity.
I. “Payroll expense” means the aggregate remuneration by a business to its employees.
Payroll expense includes, but is not limited to, salaries, wages, tips, or other draws or
distributions made to employees, officers, partners, or members of limited liability
companies and professional limited liability companies as compensation for their labor
and services. A business’s payroll expense includes the corresponding payroll expense
of any company that serves as paymaster for the business. A business’s payroll
expense also includes any business which is an alter ego of, or majority owned by, the
business.
J. “Publicly-rent-controlled housing” means housing that is:
1. Owned or sponsored by, or leased to, a public corporation pursuant to RCW
35.21.730, a behavioral health administrative services organization established
under chapter 71.24 RCW, a nonprofit community or neighborhood-based
organization, a federally recognized Indian tribe in the state of Washington, or a
regional or statewide nonprofit housing assistance organization, that has applied
to the City of Seattle for building permits and/or funding and met all applicable
Mandatory Housing Affordability requirements; and
2. Regulated through appropriate legal agreements between the City of Seattle and
the housing provider. Such legal agreements must specify renters’ rights and the
affordability requirements, including:
4

 a. Incorporating covenants to maintain the housing’s affordability in
perpetuity or for a period no less than 99 years;
b. Limiting annual rents increases for housing units in accordance with
Section 5.38.020(A)(2) of this Chapter.
5.38.030 Tax imposed-Measure of the tax
A. A quarterly tax on corporate payroll is hereby levied upon and shall be collected from
non-exempt employers for the act or privilege of engaging in business activities within
the City. The tax shall be measured as a percentage of a non-exempt employer’s payroll
expense during a quarter of the calendar year.
B. The amount of the tax shall equal 0.7 percent of a non-exempt employer’s payroll
expense during the previous quarter of the calendar year.
The tax on corporate payroll imposed by this Section 5.38.030 shall take effect on
January 1, 2021. All tax on corporate payroll obligations under this Chapter 5.38 will
remain in effect and due and payable as scheduled.
5.38.040 Tax on corporate payroll-When due
Non-exempt employers that file and pay their business license tax under Chapter 5.45
on a quarterly basis shall file and pay the tax on corporate payroll on a quarterly basis
and non-exempt employers that file and pay their business license tax under Chapter
5.45 on an annual basis shall file and pay the tax on corporate payroll on an annual
basis. Non-exempt employers shall report the tax on corporate payroll on forms as
prescribed by the Director. Non-exempt employers discontinuing their business activities
in Seattle shall report and pay the tax on corporate payroll at the same time as their final
business license tax return under Chapter 5.45 is due.
5.38.050 Exemptions from the tax on corporate payroll
The following are exempt from the tax on corporate payroll:
A. Businesses with quarterly payroll expenses less than a qualifying threshold. The
qualifying threshold shall be determined as follows:
1. From January 1, 2021 through December 31, 2021, the qualifying threshold shall
be $1,750,000.
2. Beginning on January 1, 2022, and on January 1st of every year thereafter, the
Director shall adjust the amount of the qualifying threshold in this section as
follows:
a. The amount shall increase commensurate with the rate of growth of the prior
year’s June-to-June CPI-W for the Seattle-Tacoma-Bellevue area as
published by the United State Department of Labor;

5

 b. If the annual change in the CPI-W is negative, no adjustment to the amount
must be made;
c. The amount calculated shall be rounded to the nearest whole dollar.
B. Businesses that are preempted from taxation by cities pursuant to federal or state
statutes or regulations, including, but not limited to, the following:
1. Insurance businesses and their agents as defined by RCW 48.01.050 and
48.17.010, respectively, and whose total revenue is exempt from the business
license tax per Chapter 5.45.
2. Businesses that only sell, manufacture, or distribute motor vehicle fuel as defined
in RCW 82.38.020 and exempted under RCW 82.38.080.
3. Businesses that only distribute or sell liquor as defined in RCW 66.04.010 and
exempted in RCW 66.08.120.
4. Businesses spending 75% or more of their gross income on retail sales of food
and food ingredients to consumers that are exempt from the retail sales tax
under RCW 82.08.0293 or a business spending 75% or more of their gross
income on making wholesale sales of food and food ingredients that will be
exempt from the retail sales tax under RCW 82.08.0293 when resold by the
purchaser.
C. Federal and state government agencies and subdivisions.
D. Non-profit organizations that hold a current tax exempt status as provided under
Section 501(c) of the Internal Revenue Code, as hereafter amended, or that are
specifically exempted from the requirement to apply for tax exempt status under Section
501(c).
E. Cooperative associations organized under RCW 23.86 or RCW 24.06, or any other
cooperative business subject to 26 U.S.C. § 1381, et seq.
F. Hospitals as defined in RCW 70.41.020.
5.38.060 Tax in addition to other license fees or taxes
The tax imposed herein shall be in addition to any license fee or tax imposed or levied
under any other law, statute, or ordinance whether imposed or levied by the City, the
State, or other governmental entity or political subdivision.
5.38.070 Tax part of operating overhead
The taxes herein levied upon non-exempt employers are not taxes upon the purchasers
or customers, but shall be levied upon, and collectible from, non-exempt employers and
shall constitute a part of the operating overhead or cost of doing business of non6

 exempt employers in the City of Seattle. A business may not make reduce employees’
compensation to pay for this tax.
5.38.080 Allocating funds from tax on corporate payroll
A. Taxes collected under this Chapter 5.38 shall be allocated exclusively for
expenditures on Affordable Green Housing.
B. Expenditures for Affordable Green Housing programs shall be budgeted on an
annual basis as follows:
1. No more than five percent of the proceeds in the first year shall be used to fund
one-time expenditures to implement and administer the tax on corporate payroll
and to implement the investments in Affordable Green Housing-related strategies
described in subparagraphs (2) and (3) below. Not more than three percent of the
proceeds in subsequent years shall be used to fund the ongoing administrative
functions to assess and collect the tax and administer the investments in
Affordable Green Housing-related strategies described in subparagraphs (2) and
(3) below.
2. 75% of remaining expenditures shall be allocated for the construction and
maintenance of new Affordable Green Housing programs, including but not
limited to:
a. Developing and preserving permanently Affordable Green Housing, serving
individuals and families with household incomes between 0 and 100 percent
of the Area Median Income. Such housing may be mixed-income, will be built
consistent with Seattle’s Green New Deal strategies to equitably increase
building efficiency and decrease the use of fossil fuels in homes, and may
also be used to provide related and needed community services connected to
Affordable Green Housing buildings, including but not limited to affordable
child care, community gathering spaces, and open spaces;
b. Funding the ongoing operations and services for permanent supportive
housing units, including an array of comprehensive services such as
counselling and treatment, disability support, skills training, job search
assistance, and other services needed to maintain housing stability;
c. Acquiring existing structures to incorporate into Affordable Green Housing
programs, particularly in areas at high risk for displacement of existing, lowand moderate-income households.
At least 25% of new housing units constructed each year pursuant to this Section
must be owned and operated by a public corporation, commission, authority, or
other public entity created pursuant to RCW 35.21.730.

7

 For the first three years that funds are allocated, for both new construction and
acquisition of existing housing, at least 80 percent of these funds for new housing
shall be expended on serving individuals and families who are between 0 and 30
percent of Area Median Income. Thereafter, at least 30 percent of these funds for
new housing shall be expended on serving individuals and families who are
between 0 and 30 percent of Area Median Income.
At no time shall more than 20 percent of these funds for new housing be
expended on serving housing for individuals between 81 and 100 percent of Area
Median Income.
3. 25% of remaining expenditures shall be allocated for efforts to make preexisting
housing structures more affordable and environmentally sustainable, including
but not limited to:
a. Transitioning preexisting housing units from the use of natural gas and
heating oil to electricity;
b. Installing solar technology in or on preexisting residential structures;
c. Weatherizing preexisting residential structures, with a focus on housing for
renters in communities most harmed by racial, economic, and environmental
injustice to become more energy efficient; and
d. Mitigating any adverse employment impacts that might result from the abovedescribed activities through job training programs prioritizing workers
negatively affected thereby. Specific job training investment proposals shall
be informed by the recommendations of the Green New Deal Oversight
Board, to ensure a just transition and no economic harm to any potentially
negatively affected workers.
Projects invested in under this Section 5.37.080, whether for new construction
housing development or renovation of existing housing, and regardless of
whether the project is or is not considered a public works project, shall be
consistent with the standards set forth in Chapter 20.37 of the Seattle Municipal
Code, known as the Priority Hire Program.
5.38.090. Severability.
If any part, provision, or section of this ballot initiative is held to be void or
unconstitutional, all other parts, provisions, and sections of this ordinance not expressly
so held to be void or unconstitutional shall continue in full force and effect.
5.38.100. Effective date
This ballot initiative shall take effect and be in force on the later of (1) January 1, 2021
or (2) 30 days after the ballot initiative is approved by the People.
8