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Seattle City Council Insight: Sawant hit with ethics charges over Tax Amazon campaign — UPDATE

With reporting by SCC Insight

Kshama Sawant’s January inauguration for her third term on the Seattle City Council was also the launch of a new “Tax Amazon” movement in Seattle. It may have also violated city ordinances and state laws.

Monday, the Seattle Ethics and Elections Commission charged Sawant with ethics violations for using her office to promote a potential ballot measure.

Sawant has made a revived “Tax Amazon” movement a key component of her third term at City Hall. Sawant’s office says her plan for a Seattle tax on large companies would would raise between $200 million and $500 million annually for homelessness services and housing.

The campaign has a web site registered to Calvin Priest, a Socialist Alternative employee and Sawant’s husband, and has held a string of organizing meetings. At their January 25th meeting, the group passed a resolution establishing its intent to put a voter initiative on the November 2020 ballot to impose a new head tax on large companies in Seattle. The campaign is also gathering names on a petition opposing a preemption clause in HB 2907, the bill currently pending in the state legislature that would authorize King County to impose a payroll tax.  The Tax Amazon campaign is also fundraising, soliciting donations on its web site.

Sawant’s office has been supporting this effort, using Sawant’s official email account, constituent emailing list, and city-hosted web site to promote the campaign, its events, and the need for a ballot initiative. Under both Seattle and state law, public resources may not be used to organize campaigns for ballot initiatives. But Sawant’s web site has been hosting information about the ballot initiative campaign, including promotional posters and flyers, a copy of the resolution on the ballot initiative, and archives of the group’s meetings.

Sawant’s Council office is also listed as a co-host of the campaign’s events, and Sawant (listed in her official capacity as a City Council member) is a co-chair of the ballot initiative campaign committee. The web site actively encourages people interested in helping the Tax Amazon campaign to call her office for assistance in getting involved.

Monday, the Seattle Ethics and Elections Commission filed charges against Sawant for using city resources to promote a ballot initiative. It also included a second charge that the same activity violated the city ordinance that prohibits city resources from being used for other than a city purpose.

Wayne Barnett, executive director of the Seattle Ethics and Elections Commission, said that he is not yet looking into whether the Tax Amazon campaign is violating other lobbying or campaign disclosure laws.

The findings could roll back some of Sawan’ts efforts around the Tax Amazon campaign but seem unlikely to dent the movement. In 2018, the city council passed and then rolled back a $275 per full-time employee tax on companies reporting $20 million or greater in annual “taxable gross receipts.” That tax would have generated about $50 million annually.

Over the weekend, Sawant held a Tax Amazon Action Conference at the Central District’s Washington Hall.

Meanwhile, the statewide proposal some say could undermine the Tax Amazon effort would allow King County to enact a 0.1% to 0.2% tax on the payrolls of large employers. In Seattle, a tax at the scale could generate $121 million per year.

If the SEEC determines Sawant was in the wrong, it could fine her up to $5,000 per violation, the Seattle Times reports.

A hearing on the charges is scheduled for March 4th.

UPDATE: Undaunted? Sawant is set to release details Wednesday of “a specific legislative proposal” for her “proposed tax on big business in Seattle.”

Councilmember Kshama Sawant (District 3, Central Seattle) will announce and detail her proposed tax on big business in Seattle during a Wednesday morning press conference at City Hall. In December, Sawant won her reelection, calling for an Amazon Tax on big businesses to fund a major expansion in affordable and green social housing, despite unprecedented amounts of corporate PAC money against her campaign. Sawant announced she will unveil details of a specific legislative proposal on Wednesday.

UPDATE x2: The base of her proposed legislation: Raising $300 million a year for housing and environmental initiatives through a payroll tax on the city’s largest 3% of businesses. The proposal would create a 1.7% payroll tax on the businesses with $7 million and above in annual payroll. Most of the funding would go to housing programs with around $75 million a year going to Green New Deal initiatives.

UPDATE x3: Sawant’s office has released a statement on the charges. “It’s shameful that while big business has license to run amok trying to bully or buy politicians – just look at our last election cycle – working people have to follow the most onerous of restrictions,” Sawant writes.  Sawant says that her office met with the SEEC’s Barnett to discuss the issues and that her staff has already responded by “separating the Council office from those community discussions.” “I look forward to meeting with the Commission to resolve this matter,” she writes.

“I’m disappointed to see this complaint filed against my office and our movement. It’s shameful that while big business has license to run amok trying to bully or buy politicians – just look at our last election cycle – working people have to follow the most onerous of restrictions.

“My Council office has been preparing legislation to tax Amazon and big business to fund social housing and a Green New Deal. I will be unveiling the outline of this legislation tomorrow, Wednesday, February 12. At the same time, a grassroots effort has been underway to prepare for a ballot initiative, should the City Council fail to act on my legislation. Our movement’s strategy this year is similar to the two-pronged approach we took to successfully win the $15 minimum wage in 2014. (Recall in 2018, the majority of the Council repealed the Amazon Tax less than a month after unanimously approving it, after engaging in backroom talks with big business.) I have obviously been involved in the grassroots Tax Amazon movement, but on my personal time.

“Three weeks ago, my staff reached out to Wayne Barnett at SEEC with questions about how to navigate my Council office’s work in developing legislation, at the same time that there was a grassroots effort underway. We met with Mr. Barnett on January 28 and had subsequent follow up emails with him. In the meeting, we learned for the first time Mr. Barnett’s interpretation that Council resources could not be used to encourage community discussions about a potential ballot initiative, even one that hadn’t been drafted or filed. That was contrary to our previous understanding of the rule, based on our extensive interactions with the Ethics office over the last six years. Following that meeting with Mr. Barnett, we immediately made all the necessary adjustments, separating the Council office from those community discussions. The materials Mr. Barnett cited in the complaint all predate our January 28 meeting with him.

“I look forward to meeting with the Commission to resolve this matter.”

UPDATE 3/2/2020: The SEEC has announced a delay in the Sawant case:

Please note that CM Sawant’s attorney sought, and the Commission Chair granted, a delay in Case No. 20-0116-1.

The commission will determine a rescheduled date for the hearing at this week’s meeting.

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8 thoughts on “Seattle City Council Insight: Sawant hit with ethics charges over Tax Amazon campaign — UPDATE” -- All CHS Comments are held for moderation before publishing

  1. Sawant has so far dodged ethics violation charges (such as allowing her campaign workers to enter private, locked buildings). Maybe this time she will be held accountable.

    • I think she probably will be fined. The problem is that she’ll likely rally her out-of-state supporters to pony up the dough to cover the fines. So, will she be held accountable? Yes. Will it change her behavior? No.

  2. Promoting a ballot initiative using city resources is unethical for the same reason a candidate promoting their reelection campaign using city resources is. Or a president leveraging their office to help a re-election campaign.

    • Well the key distinction in those cases is that an individual stands to benefit–if Kshama puts her weight behind a ballot initiative I can’t see how it would constitute self-enrichment or, in the presidential example you mentioned, contribute to cronyism.

      But OK, let’s grant that ballot initiatives should be off limits and decided strictly ‘by the people,’ free from city council influence: what ballot initiative is Kshama promoting? Currently, there is no ballot initiative. Yes, there’s “Tax Amazon” and a bunch of community members who are organizing around the idea of taxing big business in some way, but I think it’s a little silly to say that Kshama can’t interact with the community in any way simply because they might end up pushing for a ballot initiative to accomplish what they want. Kshama is not using city resources to push for any specific legislation, she’s supporting community action in her district, which is exactly what she’s supposed to do.

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