CEO UPDATE: MARCH 2023

Washington State Legislative Session

The legislative session is nearing the three-quarters mark and budget-writing is in full swing. We continue to watch budget proposals as they come out. The revenue forecast was released last Monday and will guide spending over the next two years. Revenues remain healthy but are forecast to decrease, which is why we’ll continue advocating for the state to build up its reserves.

• Last Monday’s revenue forecast came in under earlier projections, reflecting the projected broader economic slowdown. There are fewer building permits and real estate excise tax collections are down 42%. Personal income growth has also slowed. The Federal Reserve’s interest rate increases to fight inflation have cooled the economy, but Washington remains in a strong position. Lawmakers will still have more to spend this biennium than they did in the last two years, meaning they likely won’t face pressure for new taxes or major budget cuts.
• The Supreme Court did uphold the Capital Gains tax, which will mean that there will be more revenue than the state budget accounted for as referenced above
• As we discussed at this year’s Horizons event, there is a bit of a “reset” happening in our local, national, and global economy. Pierce County and the South Sound are better positioned for resiliency however, recent bank failures and future interest rate increases continue to add to the economic uncertainty. 
• The Senate’s capital budget proposal unveiled last Monday shows a big investment in housing, which is encouraging given our priorities this year. There’s a record $625 million for housing, including $400 million for the Housing Trust Fund. That’s more than the entire amount the state budgeted for housing in the three biennia before the pandemic. The new funding plus a package of housing legislation would be a big win for addressing the housing crisis.

 
Pierce County

• Last Tuesday, the Pierce County Council approved the 1/10 of 1% increase in sales tax to fund housing and related services. The tax is expected to bring in 6.3M in revenue in 2023 according to estimates. Remember, cities that already adopted this, such as Tacoma, will not pay that additional .1%. Ryan Mello, Dave Morell, Marty Campbell, Jani Hitchen and Robyn Denson voted in favor. Amy Cruver and Paul Herrera voted against.
• Also on Tuesday, the Council approved the Tiny Home Village project west of Spanaway as a new approach in the County to address homelessness. 285 micro homes will be built on an 86 acre site. The goal is for construction to be completed by fall of 2028. More information on this project can be found here.

 
City of Tacoma

• Last week, thanks to successful advocacy efforts we were successful in securing the Mayor’s approval to add Ryan Spence, our MIC Program Director to the Tideflats Advisory Group (TAG). We had a robust meeting last week and are continuing to monitor all activity related to the sub-area planning process and EIS. Again, thanks to our successful lobbying the Chamber holds two seats now on this critical advisory group, along with several of our members, including our GAC Chair, Tony Belot.
• I continue to meet with the Mayor regularly and the Economic Development department on the plan to advocate for the 4M projected increase due to business license fees to be reinvested for the business community. More meetings are scheduled with the EDC in April and I will continue to keep you all updated.
• I continue to meet regularly with law enforcement and City officials to do all we can to create and maintain a safe, clean, and welcoming environment throughout the City and have had several one-on-one meetings with representatives from the South Tacoma Business District. We are particularly grateful for our partnership with the Downtown Tacoma Partnership as we look forward to continuing to support and enhance our shared work. We also had a productive meeting with UWT on how we can continue to activate campus and maintain a safe environment. These meetings will now happen more regularly with UWT Leadership, Chamber and DTP.

Thank you,
Andrea Reay
President & CEO Tacoma-Pierce County Chamber