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Now, y'all, we've been chronicling the downfall of Seattle under its socialistic policies with its new mayor, mayorist Katie Wilson, y'all. And it looks like things are coming to a head. They are losing tens of thousands of jobs. They have the highest vacancy rate among commercial properties, y'all, in the entire metropolitan United States. So, out of all of the metro areas in the United States, Seattle has the highest percentage of office vacancies, y'all. And on top of all of that, they think that for some reason, the solution to this problem, which has resulted in a huge half a billion dollar budget shortfall, they say, "You know what? We should just raise taxes." Why? You know, the businesses that are still here, let's tax some more. And that's not going over very well, y'all. So, we're going to be taking a look at that here today. Also, mayorist Katie Wilson is having to pair back one of her signature initiatives due to the lack of funds, y'all. It's all falling apart in Seattle predictably. So, without further ado, y'all, let's go ahead and get into it.
>> Seattle is leading the nation on a list that no one wants to top. Office vacancy rate is 36.5% in downtown Seattle, now the highest of any major US city. Since 2020, downtown Seattle has lost around 30,000 jobs. That's the same year Seattle passed its payroll tax, targeting large companies with employees making high salaries. According to the Downtown Seattle Association, the city's record business taxes are a major factor in the job loss and for its high office vacancy rate. Today, I spoke with John Scholes, president of the DSA, as Mayor Katie Wilson considers more taxes as a way to plug a nearly half a billion dollar budget shortfall in the next three years. Mayor Katie Wilson said back in June that more taxes are on the table, including the expansion of the payroll tax, as you know, aka the jump start tax.
Thoughts on that regarding the expansion of the payroll tax down the road possibly?
>> Well, I think it's the wrong move for Seattle and it would continue, I think, to push jobs outside of our city. And we don't need more business taxes in Seattle. We need more businesses located here paying taxes. And I think it's important for the city to spend within their means. They haven't done that over the last five or six years. They've spent beyond the revenues that they've collected and they've tried to make up the difference by putting a lot more taxes on Seattle employers which have sent a lot of jobs elsewhere.
So, can you blame all of this on postco y'all? Well, the problem with that is even though probably some of these office vacancies are the result of what happened in 2020 and thereafter, Seattle is actually fairing worse than every other major metropolitan area. So, while they may want to blame it all on that time frame, it seems to be very unlikely that that is a complete or sufficient explanation considering the fact that every other place in the country is doing better than Seattle also again are higher taxes I is that the solution?
>> You know what about the people who say you know there was a recent report that said the GDP was very strong showing the economy was very strong in Washington state just this year the sky is not falling. You know, much of the slowdown is AI and tech companies who are laying people off and it's not really the taxes or the politics of downtown Seattle. Do you buy that?
>> There's a lot of turbulence and headwinds and I do think Seattle is in a unique position relative to many other major metros. If you look at the top 30 major metropolitan areas in the US, you know, we're near the bottom when it comes to job growth over these last four years. So yes, certainly COVID and shifts in how tech companies are hiring and investments in AI and layoffs and inflation and national and global uh turmoil that has created a lot of uncertainty economically are factors, but those are factors that other cities are facing as well. And many of those cities are growing jobs and Seattle hasn't.
So, take a look at these falling property values in Seattle right now as a result of these office vacancies, y'all. If you can't staff the offices, then the value of the property is going to go down because the revenue is down, right? I mean, if you have an office building with a thousand offices in it and only 700 are rented out, it's not going to sell for as much or have the same value as if 900 or all thousand had been rented out. So this is a doubling up of the problem. Not only don't you have the jobs with somewhere over 30 to 40,000 jobs lost, but you also have the problem where the office building values are falling. In downtown Seattle, the vacancy rate is now as high as it's ever been. 37% according to the Downtown Seattle Association. That now means more than a third of all office space sits empty. And that's causing property values to plummet. We pulled property tax values for the top 10 most expensive buildings downtown. Here's a few examples. Number 10 is the Amazon HQ block in the Denny Triangle. Three buildings valued at $53 million back in 2021. 5 years ago. Today 183. The office tower at $9.99. Third is the next most valuable property. $532 million 5 years ago. Today the value is down half. And what about the most expensive building downtown? The Columbia Center. The tallest building. 76 stories prominent on the skyline. In 2021, its value was $850 million. Today, it's down more than half, a value of $377 million. According to John Scholes, the president and CEO of the Downtown Seattle Association, there's one key reason for businesses fleeing their office space right now. These are realities that other cities in our region and around the country are dealing with too. Hybrid work and postco, all of that, right? But they're growing jobs and we aren't. Belle is growing jobs. Seattle is not.
>> So, as you have seen, it's just it's just a massacre, y'all. I mean, commercial the commercial property situation, it it it's dire. It's a crisis. And as has been pointed out, this is not just a Washington state thing. This is a Seattle thing. Other areas in Washington state are seeing growth, but not Seattle. Now, Washington State has had socialistic type policies across the state, but it looks like Seattle has gone full full socialistic, and now they're paying the price for it, y'all. Over 40,000 people have lost their jobs. Just think about that.
>> And all those empty office buildings in downtown Seattle, dragging down property values.
>> Vacancy rate that we face today of plus 30% in downtown Seattle. We've not had that level of vacancy over our history. And you know, we've been in some tough spots before during the Great Recession. You know, in the 1980s, there were a number of new office buildings that all came online and were completed around the same time. And that helped inflate the vacancy rate significantly at that period. But this is somewhat unique and the the impacts are not just for the folks who own office buildings. the impacts uh are felt more broadly than that because it's having an impact on the value of commercial property in downtown and we've lost billions of dollars of property value from office buildings downtown and that has an impact on residents in our city because our city is so dependent on property tax collections. It shifts the burden uh to residential property within the city. So uh we've lost about 40,000 jobs in the downtown over the last four years. we're going in the wrong direction after 15 years of really robust and steady job growth. And so we're ringing the alarm bell that we're we're not in the same place we were in 2017 and 2018 and 19 when we had all these cranes in the air and Amazon was growing at this record clip and we had other tech companies coming to locate here and grow. We're in a different period.
And now mayorist Katie Wilson, y'all, she ran on a platform of helping the homeless, of getting the homeless people off the streets. But even that initiative has faced the tough, the hard, the brutal reality of the munge, y'all. You need money to help homeless people get off the streets. You need money to build housing for them. You need money to feed them. And guess what? Seattle has a lack of right now? Money. So, even her signature help the homeless initiative looks like it's going to be paired down and not quite what she envisioned.
>> Significant changes in how Seattle and King County will approach homelessness. Today, the executive and mayor jointly announcing a major downsizing of the King County Regional Homelessness Authority. That agency has been tasked with solving the homeless crisis since 2019. But since then, the rate of homelessness has only gone up and millions of dollars unaccounted for. These are significant changes to how we deliver our regional response to homelessness.
>> The King County Regional Homelessness Authority has been mired in controversy for many years, and a recent audit released damning evidence of $13 million of unaccounted spending. It's no secret that over the past six years, this organization has experienced significant leadership turnover, multiple audits, and most recently an independent forensic evaluation that identified serious concerns related to financial management, governance, and internal controls.
>> That prompted some politicians to call for a complete dissolution of KCHA. Mayor Wilson and I have inherited a lot of issues, but we will not maintain the status quo just because change is hard.
>> So now with these budgetary concerns, yo, your girl, she's looking at does she just dissolve the agency all together? Like we don't have the moon to make this happen. What are we going to do? Well, she's not going down without a fight, y'all. But again, as we see the commercial the commercial dis occupancy rate, right, is over one-third of all commercial units don't have anybody in there paying taxes, y'all. So Katie Wilson's not ready to throw in the white towel as of right now for her homeless initiative, but she going to have to try to find that moon, y'all. Seattle Mayor Katie Wilson and King County Executive Germay Zahalai say they are not ready to dissolve the agency completely, but they are taking local dollars back from KCHA, mostly leaving the agency to handle federal funding.
>> We are reabsorbing our city and county contracts to to the city and the county. And you know, this I feel is really um for me a matter of taking political responsibility.
>> The AY's budget is roughly 200 million per year. The move means the agency will see most of those dollars go away, but will handle around 67 million in federal continuum of care funding to fight homelessness. We have seen another significant increase, especially in our rates of unsheltered homelessness, which we should all feel um is unacceptable and feel a real urgency around addressing that fact.
>> After the announcement, KCHA CEO Dr. Dr. Kelly Kinison acknowledged the agency hasn't met expectations, but she says eliminating it is not the answer.
>> It is a failed experiment and I think um we need to do something different. So, I really respect the courage of the mayor and the executive to do that. Um Mayor Wilson's right that this actually puts political accountability back where it should be.
So, yeah, y'all. I predict this is going to be the outcome of socialism. This country is undergoing an experiment right now where certain areas are becoming more and more friendly to capital and certain areas are becoming more and more unfriendly and the businesses are moving where they can multiply their capital and leaving behind these socialistic areas. So what do you think y'all? Do you think Seattle will figure it out? Do you think mayorist Katie Wilson has a plan? Will she be able to make it work or do you think this is all just going to fall apart? Let me know. Y'all drop a comment down below. But before you do, please stop, hit the share button, share this video out over email, text message, WhatsApp, Facebook, Snapchat, Instagram, all your favorite social mediums. And of course, if you're not a subscriber, please do subscribe. Thank y'all for watching. Love y'all. And we'll see you back in the next one. You know that we are a parallegal school. If you've been watching our program now, you know that we've been around for 23 years. You know that we help people get going in the parallegal field. You know that we've helped hundreds of people since 2003 start their career in the parallegal field or even move up in their career. Our certificate is good nationwide and our program comes with an internship placement so that you'll get real experience on your resume. If you're interested y'all, we we are running a discount for all of our YouTube subscribers. Click the first link down in the description. Join us.