Kirkland City Council Votes to Impose Business “Head Tax”
Council struggles to find way to balance City Budget
At the final Kirkland City Council meeting of the year, the agenda was packed. Before the City Council were 21 ordinances and a council chambers filled with concerned citizens. After months of budget discussion, debate, bartering and horse-trading, the time had come to adopt the Biennial Budget for 2009-2010. The service level cuts and utility tax increase issues had mostly been settled. The remaining issue to debate was the levy on FTEs, commonly known as the “Head Tax” on businesses. This tax would replace an existing business tax with a $100 levy on every full-time equivalent (FTE) employee hired by a Kirkland business.
Three local business owners spoke against Ordinance 4161, which would change Kirkland Municipal Code and have the effect of enacting the “head tax”, but to no avail. The Council voted in favor of the ordinance by a margin of 5 to 2.
How the City Council Voted:
VOTING IN FAVOR OF THE MOTION TO APPROVE ORDINANCE NO. 4161
- Mayor James Lauinger
- Deputy Mayor Joan McBride
- Mary-Alyce Burleigh
- Jessica Greenway
- Tom Hodgson
VOTING AGAINST THE MOTION TO APPROVE ORDINANCE NO. 4161
- Dave Asher
- Bob Sternoff
In other budget-related ordinances, the Council voted in unison, easily passing ordinances with votes of 7 to 0. These ordinances related to:
- 2009-2014 Six-Year Capital Improvement Program
- Property Tax increases levied for the year 2009
- Utility Tax increases on certain utilities.
After heated discussion from the dias, Ordinance No. 4163, Adopting the Biennial Budget for 2009-2010 was passed on a vote of 6 to 1. Councilmember Bob Sternoff cast the lone dissenting vote.
Several on the Council have expressed concern about the disparity between the tax burden paid by residents in relation to that paid by businesses. Councilmembers stated that raising business taxes at this time was an attempt to rectify the tax burden inequity.
Posted by Rob Butcher on Wednesday, December 17, 2008 at 8:24 am
Filed under Council · Tagged with Budget, City Council, Government, Taxes, Vote
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This one takes the cake for me and I am sure others. Why is it that the City doesn’t have to get it self in order first before they raise taxes. Sternoff was on point. The Council and Staff knew about this in early spring. It is clear that the finance committee made up of Joan, Jessica and Jim did nothing. Staff figured they would convince the Council to raise business taxes early in the game. The Finance committee bit first and never gave it up. Result is that staff continues business as usual. No new plan or initiative to reorganize and do what other Cities around us have already done. It was interesting to hear Dave Asher’s reason he voted against the business tax because he wanted all of our taxes to go up! all the rest want to wait until the retreat to deal with how our money is spent. Jim’s slam at the City Manager was uncalled for. The mayor and the Council are responsible for giving the City Manager his marching orders. Sternoff correctly noted all the time wasted this year on the Downtown while the budget imploded. To me this is unforgivable. In the end I doubt that the City will collect all the funds they think they will and will be that much further down the road to massive cuts that will effect us even more.
Al
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Last Tuesday night I watched Kirkland Councilmembers squirm to justify to the voters the purging of Kirkland’s family budgets just to pay for non-essential services. They begged for voter understanding as to why citizens were being fleeced out of the money they need to take care of themselves and their families. Here’s the scorecard.
Councilmember Sternoff had some good points saying Kirkland did not end up with a sustainable budget. His suggestions were valid; however, taxpayers should not forget he’s a politician who believes the city budget is more important than the family budget. At least, among other Councilmembers, he was the most understanding of the impacts to family and business budgets.
Councilmember Greenway promised to work with business and taxpayers to ease their financial impacts in the future but did not stop her from voting for a budget that raised taxes in times of recession. There should have been far more budget cuts before raising taxes, at least another million. Other Councilmembers disagreed.
Councilmember Hodgson also voted for the budget saying the city needs the money. He failed as other Councilmembers did in separating essential services from non-essential services. He should stop treating us as a unlimited resource.
Mayor Lauinger felt the budget was necessary to sustain non-essential staff positions. He should appreciate working for a government that is barely able to sustain its budget rather than having the luxury of citizens who make an average of $72,000 per year. Many city governments don’t have enough money to have capital improvement programs. He should feel the pinch as other governments do.
Councilmember Asher voted for the budget but realized it needs adjustments to be sustainable. I would hope he would analyze what are non-essential services versus governmental essential services. Someone needs to stand up for family budgets.
Councilmember Burleigh spent freely in prior years using up the city’s $12 million per year surplus. She now finds it hard to break the habit. To her credit, she is willing to develop a sustainable budget but at whose cost? Given her belief in the redistribution of wealth, she will not reduce expenditures but will seek new sources of revenue.
Councilmember McBride is a do-gooder for special interest. She feels no remorse about budgeting taxpayer money to pay for her special interest at the expense of everyone else in the city. Kirkland is a city, not a chapel and she should not regulate whom we donate to.
Sincerely,
Robert L. Style
6735 Lake Washington Blvd, NE
Kirkland, WA 98300
425-827-0216
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The only answer is to replace the council with members who don’t have their heads up (I don’t think i can finish the sentence and still be printed).This means we need people willing to step forward and run for those positions up for grabs in the next election. Sorry, not me, I still have a business to run. However, I will lend my support both in time and money to get replacements elected.
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Bob,
I don’t think you stated correctly what Sternoff or Asher said. Asher stated he wanted to raise our taxes by vote. Sternoff said he didn’t want to raise taxes (he voted no on business tax and budget. He wanted a revamp of how the City does it’s business. He said many times that the City cannot continue to do business as usual. The rest of the Council are lemmings who have been there too long. I am not sure where you get a $12 mil a year surplus. I can’t find it in any of the budget docs for this year or the 2 prior budgets. Is there money buried somewhere? Al
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Al,
Sternoff was correct. I applaud what he had to say but I still am watching what he does. Asher suggestion is a politician’s way of protecting their political image by “letting” taxpayers vote on tax increases instead of politicians. In order to insure passage, he and the other elected officials will manipulate the budget to create shortfalls in fire, police, and parks. If we need tax increases, let our elected officials be responsible.
The $12 million per year budget surplus is an average over the past 15 years and is the difference between the adopted budget and the end of year budget. Over that period of time, each year I’ve obtained copies of their proposed budget, kept track of what was adopted, and compared their end of year budgets against what was originally proposed. Remember, when the Council adopts a budget, they promise they can run the city on that amount which includes funding reserves. Each year they protect what some call the “Kirkland” identity, and each year they have a surplus, even this year.
According to the adopted budget, the Council, by law, must show a balanced budget, a budget that pays for everything they propose. By the end of the year having funded what they promised, they have money left over which includes funds not spent and carried forward, and excess revenues.
My problem with the budget process is the Council doesn’t stick to their original budget. They always bust right through it. If they stayed on budget, our taxes would be lower and we would not be in danger of losing our “Kirkland” identity.
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Kirkland Government is a perfect example of what has become “Government by Government” – rather than a “Government of and by the people” If business can find ways to “make do”, “cut back”, “be more effective” – so should Governmennt, including this Kirkland Governmnet. But rather
than make cuts to Governent spending, they say, “let’s levy yet another tax on the people” – let them cut back, but not us! If you were looking for a location to site your business, one of the methods of decision making is to list the pro and con of such a move. A $100 tax per empoyeee is a major “Con” – their will be some businesses that will not locate here, others that will leave, and all will be looking for other choices. Some time ago I spoke with a business, who was going to expand her business in her city, but her city had just passed a head tax, and she did not expand or hire the extra four employee’s because of the tax.
A head tax is just another way to hold down employment, business expansion and prosperity within a community. Yet another example of this city council “not getting it”. This city needs a change from this City Council! and Mayor. If we home owners would like more city services, let us vote to send in an extra hundred or so, but don’t just take from a few citizens with little voice on the Council . Our Gang of Four will always vote for more taxes, protecting Government is their reason for being, they no longer represent the peoples wishes.. With so many other things this City Council has done, this will spead the decline of the tax-paying business communtiy in Kirkland. – but with elections coming, some or more just might do something good for the community, like voting for the community rather than the protest groups, could be the Christmas spirit – we can always hope!.
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