August 16 , 2022 - Emily Makings

Seattle has now collected $290.1 million in payroll expense taxes for 2021

When the City of Seattle closed its financial books for 2021, it had collected $248.1 million for the year from the new payroll expense tax. Since then, an additional $41.9 million has come in, according to the city’s Office of Economic and Revenue Forecasts (OERF). The OERF and the City Budget Office presented the August […]

July 29 , 2022 - Emily Makings

New legislative task force on paid family and medical leave premiums begins its work

Given the financial issues with the paid family and medical leave (PFML) program, the Legislature passed a bill earlier this year (2SSB 5649) that established a legislative task force on paid family and medical leave insurance premiums. The task force is charged with making recommendations for any changes to PFML premiums, “to ensure the lowest […]

July 28 , 2022 - Emily Makings

Paid family and medical leave premiums increased substantially in the second quarter, but cash flow problems persist

The premium rate for the state’s paid family and medical leave (PFML) program increased from 0.4% to 0.6% in January. Premiums are assessed quarterly, so the second quarter of 2022 is the first in which premiums were collected that had been assessed at the 0.6% rate. According to data from the Employment Security Department (ESD), […]

July 14 , 2022 - Emily Makings

Capital gains tax revenues in the June forecast

The Seattle Times reports that the capital gains tax case will go directly to the state Supreme Court, rather than being heard first by the Court of Appeals. Oral arguments could take place in November. In March, a Superior Court judge ruled that the tax is unconstitutional. Under the statute, the capital gains tax was […]

July 07 , 2022 - Emily Makings

Two opposing views on Washington’s long-term care program

The Forefront blog of Health Affairs has published two counter-takes on WA Cares, Washington’s delayed long-term care program. One considers WA Cares a failure, and the other (while acknowledging some problems) considers WA Cares a model. I wanted to add some context for both. (Technically, WA Cares is the long-term services and supports trust [LTSST] […]

July 06 , 2022 - Emily Makings

Based on actual long-term care program opt-out data, the payroll tax rate will need to rise by an estimated 0.036%–0.061% to maintain solvency

As we noted in our 2021 report on the state’s long-term care program, it looks like the 0.58% payroll tax rate for the program will not be high enough to maintain actuarial solvency. By statute, the premium rate for the long-terms services and supports trust (LTSST) program (also known as WA Cares) cannot exceed 0.58%. […]

July 06 , 2022 - Emily Makings

Medicaid savings and Washington’s long-term care program

Since our report last year on Washington’s now-delayed long-term care program, the Office of the State Actuary has published new information on Medicaid savings and private opt-outs. (I’ll write about the opt-outs in another post). The long-term care program is technically called the long-term services and supports trust (LTSST) program, but it is commonly known […]

June 21 , 2022 - Emily Makings

Court of Appeals: Seattle’s payroll expense tax is “a valid exercise of the City’s taxing authority”

Today the Court of Appeals upheld Seattle’s payroll expense tax. According to the opinion, the tax “applies to the privilege of engaging in business, not an employee’s right to earn a living by working for wages.” Thus, “it is a valid exercise of the City’s taxing authority.” Seattle collected $248.1 million from the payroll expense […]

June 20 , 2022 - Emily Makings

Seattle’s operating deficit is the result of unsustainable budgeting, not a “revenue shortfall”

A story in the Seattle Times about Seattle’s projected operating deficits states, “the city must find a sustained new revenue source.” (The headline: ‘“No obvious way out’: Seattle facing $117 million revenue shortfall in 2023.”) Although it’s true that the city is projecting general fund operating deficits over the next several years, it is not […]

May 06 , 2022 - Emily Makings

General fund spending is outpacing revenues in Seattle, even as revenues have increased considerably

On Wednesday, the Finance and Housing Committee of the Seattle City Council discussed general fund financial planning. Last month, the committee received the full general fund (GF) revenue forecast. Revenues are expected to be up compared to the forecast on which the 2022 adopted budget was based. However, this week city staff told the committee, […]