want to know the future of seattle and washington state well paul guppy of the washington policy center has his crystal ball out and is going to tell us all about it right here on public exposure welcome paul thank you i want to get through that really quickly because we have so much stuff to do i mean is there a reason to stop this tunnel project now well it's probably too late to do that i mean so much has been invested in it in terms of the design for the waterfront there's also the rebuilding of the seawall and they want to create a boulevard along the waterfront so that's all part of it but this point about the asset of the viaduct is an interesting one because even for the fifty years that it's been there drivers have noticed what a fabulous view there is elliott bay and the olympic mountains and in some ways it would be a shame to lose that so there are ideas about turning the viaduct itself into part of a park if that's possible and so there may be a way to preserve the at least some of it well i'm thinking about it from a utility standpoint because seattle's big dig is a lot of people are calling even when it's completed won't carry as many cars right and this is the amazing thing that grow we watched in policy center we pointed out is that the that corridor along the waterfront is going to get smaller it's going from six lanes of travel to four lanes and so i think that will cause traffic backups in the city but that's the design that the governor and the mayor of the city have decided on and they're pushing ahead with it now but at some point in time do you continue to push ahead when something's just not working well that's a great point because if the tunneling machine had all gone smoothly and the thing is enormous and it had to be assembled in the construction pit itself it's not like they could ship it from someplace else and now that it's stuck for an indefinite period and of course time is money so that cost is adding up for the taxpayers of the city and for the state and at some point you wonder whether the engineers will say this is just not practical and well especially when seawater is actually getting into it now is that accurate there are multiple problems so this is the thing that happens with engineering projects is that one problem causes another problem leads to another problem and that's what's beginning to kind of cascade with this now of course any engineering problem can be solved with enough time and money so so far they're sticking with it but again there's that public policy question at what point do the hundreds of millions of dollars of extra costs mean that maybe this isn't worth doing anymore well yeah that's kind of the question and the probably a stupid question who ends up paying for this well that was one of the fights to begin with that the state had insisted that if the city wants a tunnel then city taxpayers in seattle are on the hook for the overall costs now of course seattle's delegation will go to a libya and try to get state taxpayers to pay for that it is a state highway  that dispute is still underway but what's interesting is that argument was made even before the first shovelful of earth was moved about who would pay for the inevitable cost overruns the problem is that with the machines stuck underground this is much larger than just the normal glitch that you would expect with a project like this ok well it sounds like we're going to solve it today although i have a solution which is to stop the project and just you know fix that then and i've heard some wits say that guys with shovels would do a better machine well let's let's go on to something else when i first moved here in one thousand nine hundred two the one of the first things governmentally that i noticed is that seattle city council members were elected in large and that's all changing force and that's to the good if you if you asked my opinion so this is my field political science which is what kinds of government systems are there and of course in seattle we have a democracy but in the way that the the representation works is that the entire city is one district and and all nine members of the city council plus the mayor are elected from that one district so to speak so what that means is that we have basically ten mayors every top elected official is elected by the same political coalition of in our case it's developers environmental activists powerful city unions and if a candidate for office can line all those up and get the funding chances are that they will get elected what happens with neighborhood districts which is this system we're going to we're going to have seven districts and then two at large the good thing about neighborhood districts is you get true representative democracy so there will be a representative for ballard one for west  south seattle capitol hill queen and hill university district all those neighborhoods will have one representative that speaks for them and then just like in a normal democracy those representatives have to get together and agree about governing the city and in those districts only in those districts are going to be voting for for people who are going to be running for office there and the people running for office and district one for example right are not going to have to appeal to for votes to have people in district nine exactly and that's an important point because with the municipal community that we have unlike a congressional district which has six hundred thousand people in it a seattle neighborhood is actual actually walkable direct democracy so the candidate could actually meet most of the people who may be participating in the election or go to a neighborhood fair and actually meet people so that works at the local level and i think it will change the dynamics of the city because of that well that's that leads to the next question  then this city council that's in place right now knows what they've got coming they all have to run right are they what are they likely to do that's pretty unusual do you think that's coming down the road i mean i've already done some things that are pretty unusual minute exactly they may try to rush some things through that nine of them or seven of the hiring agree on which is to say they know they have a certain governing system now and on those things that they agree about  especially if their interest groups in the city and that would be a good environmental groups the seattle bicycle club the city unions they're the ones who have the most dominance now so what they may do is try to get certain agenda items through while they have the votes but as we transition to a district system every member of the city council will have to make their own calculation i think some will just retire they won't want to run in the neighborhoods but the others will choose you know what is their local neighborhood and then they'll try to keep their seats by appealing to their own area of seattle what are they what is the city council likely to do what do you think that they're going to take on you know one of those unusual things that they're going to try to rush through well right now they're trying to get it to our parks district passed if that's passed by the voters then it's done if if for whatever reason it doesn't pass in the august fifth election i think that the city council may try some alternative parks funding plan to get that through before the votes change on the council that would be one of the items i absolutely love my parks absolutely but when i looked at this at this proposal for a seattle parks taxing district i kept looking for the other part what's the operational part so i mean what is silly thing it is to create a group that the only thing they can do is tax right but they can't oversee whether or not the taxes are being spent appropriately exactly so normally you think of a special purpose district like a sewer district or in eastern washington they have mosquito control districts really with and it's a board of three people and they have a small amount of funding and then they focus on that one mission and you know they serve the public that way the thing about this park district in seattle is that it will only exist on paper they will only be able to carry out one function and that is to collect property taxes everything else that the parks do will be run by the city just as it is now so there won't be any change in that and seattle has a great park system and a lot of people find it disturbing the city can't find the room in the one billion dollar general fund budget in order to provide a core service like that so the parks district is a mechanism for raising property taxes well that you know that's a great thing though from a governmental standpoint i mean heck let's just create all of these different taxing districts we'll go ahead and operate over here exactly the way we want to and then we will tell the taxing districts how much taxes that they have to raise and so then we will get rid of any responsibility for accountability right so what it's doing is fragmenting the responsibility in city government and it also allows the city council to eat evade the cap on property taxes that is imposed by state law so there's a taxpayer protection provision that says that no city in the state can raise taxes above a certain level as you would expect seattle is bumping up against that live but by creating a parks district that's a different unit of government so it has a whole new taxing authority that's not limited by the state cap  wants this the powers that be at the city so this is very much an establishment proposal it is not a grassroots bottom up there's no call from neighborhoods to create this kind of funding mechanism instead there competition within the general fund budget of different interest groups and by taking parks out of that these interest groups know that that frees up money that ordinarily would be spent for parks and instead would be made available for programs that they support  have a shell game well it is you know but but i live close to a fantastic park jefferson park it's very funny my daughter and i go over and play all the time and we love it but that was actually created by a special  anyway right so there are you know opportunities when ace municipality can see a piece of property is coming available we were talking a little earlier about olympic national park along the washington coast so there's an opportunity for a governing body to preserve an area before it gets developed and that makes sense you know snapping up a piece of real estate for a great park is a good idea the problem with seattle's traditional parks and as you know many of them were designed by the olmstead brothers the same firm that did central park in new york we have wonderful heritage parks in the city as well as new ones is that instead of running that as a high priority program within the city budget they're breaking that off into this parks district idea and i think that creates some risk that parks were no longer have the same status i guess within the general budget that they had before and that's that's really really too bad i mean the parks are very important to a city for sure salut it's a core public service everybody would have agree on that you know speaking of the city council we're talking about things that perhaps are a desperate quick move it seemed to me i'm not sure where i stand on the fifteen dollars per hour or minimum wage what i really wanted was a business analysis you know from all sides to where you know big labor small labor big business small business and consumer groups could always have and we could have a really intelligent discussion right didn't happen yeah that is a great point in fact in you're seeing this connection that i haven't seen anyone else make which is that because of the way seattle is governed they were able to get the fifteen dollar minimum wage through pretty quickly but you can imagine an alternative system which we're moving to and that is if we had neighborhood districts you would have members of the city council who were talking to small business people in their own neighborhood that they knew personally because they are the representative for ballard for west seattle for south seattle  and they would bring that message to the city council when they were debating the impact of the minimum wage on unemployment and that was the concern about losing jobs in the city because the cost of the minimum wage would go up so much that dynamic and the  that fifteen now campaign was conducted is and i watched the city council meeting in which they voted for that and i noticed they were you know i guess you call them in lockstep i mean they voted they were intimidated you may say that they didn't want to vote against it now if you can think of a local city council member who said you know i know that there's this big campaign for it but i've talked to small business owners on main street in my area and they say that this is going to cause problems i think it would have brant brought a note of common sense from the neighborhood areas of seattle well i'm not saying even to this day i'm not saying that it's a bad thing right what i'm saying is that there wasn't the appropriate discussion you know for example what i've heard is that people are saying well you know mcdonald's will immediately go to vending machine tellers they will and that's going to happen whether there's fifteen dollars an hour or not you know everything so in the world of competitive economics everything is a trade off as you know business decisions are made at the margin so what a franchise owner might be saying is i fifty employees do want to do i want to make it eighteen employees or should i just hire or shut just add a machine so so they're constantly making that calculation whether there's a fifty dollar minimum wage or not what the higher minimum wage does is add new numbers into that calculation and creates an additional incentive to go to automation or to somehow find a way to cut back on personnel in order to keep payroll costs under control i think that's what will happen now but you know historically this is the same discussion that was had after the civil war in the united states where automation came in and right in the eighty's and the eighteen ninety's automation came in and people said oh my the jobs are go away while some jobs do go away right and then hundreds of other jobs are created someplace else so this constant dynamic has been going on as you point out since the industrial industrial revolution the difference is that you know a private company that makes a capital investment is in machinery let's say that they're expanding their whole productive base is growing and that could actually add machines and jobs both because the entire company is getting larger or the market is getting larger the thing about a fifteen dollar minimum wage is that it's an artificial restraint that is imposed by government so it's not a signal from the market that wages should be fifty dollars it's just an arbitrary number that the city council has chosen and so what business people do is try to balance that out someplace else this added cost has been is not voluntary ok it's been imposed and so human nature is such that people business people will adjust to absorb the additional cost so i think they'll do a combination of things they'll do more automation they'll raise prices i heard of a number of businesses that just are not going to expand you know a restaurant that has two outlets if they open a third it will be outside of seattle and there are a couple of stories like that in the press i'm going to ask about the impact on nonprofits who are are going to be subject to that requirement as well but first we have to take a very short break we're talking with paul guppy who is from the washington policy center the washington policy center's website is up on the screen and it is a think tank and so we're going to be sure to be talking with paul in just a minute about washington policy center itself but first i want to get back to the issue of the fifteen dollars an hour and nonprofits i've worked in and around in and helped nonprofits here in the seattle area for quite some time the fifteen dollars an hour minimum wage is going to hurt them it certainly is because as i mean i work for nonprofits so you so you know but that by definition a nonprofit is financed two different way either through voluntary donations or government grants but it's not a nonprofit doesn't have a customer base with prices so instead nonprofit has to go to their source of funding and say we have this added cost is there a way that we can accommodate it and i think the answer is going to be sometimes yes sometimes no so i think some donors may step forward to help the nonprofit there are a lot of non profits that do business with contracts with the city so they will go to the city government and say increase our grant i mean we have these increased costs that will put political pressure on the state budget and could be costly the flip side is it just makes profits less viable so they struggle to add personnel and as you know a lot of nonprofits are social service agencies so their entire work is all based on people and so it's very hard for them to cut back on their workforce and that would definitely affect their mission what's going to happen when let's say the city goes in and they and they find let's say a restaurant is paying an average of ten dollars an hour or eight dollars and i'm one of the going to do they're going to go in and say we're going to you know we're going to shut you down until you pay wages i mean yeah they have three levels of enforcement so so they have this is all laid out in the ordinance that the city passed so the first step is a warning so they do an inspection and then a warning they are allowing in the short term things like tips and health care costs so that all has to be calculated into the fifteen dollar minimum wage so health care costs are part of a four initially and then that raises out later i say there's also a distinction between small businesses and large businesses so you can see that there's a whole set of rules here in which the city is set up to enforce and step one is a warning and step two is fine and step three of course is the city can deny their business license ok so i'm going to be interesting to see and still i wish that there had been an economic discussion on it as opposed to the political discussion that it seemed to be tell us about the washroom policy so why are we are an independent nonprofit we're based in seattle and we have offices in spokane the tri cities in olympia and we have a staff of where we have seventeen people all together and we have seven analysts to focus on different research issues transportation small business protecting the environment state budget and we do studies and commentary but of course most of our work is now online so we have a regular blog and  media interviews like this one but mainly what our mission is to is to explain public issues to the public in a way that hopefully is understandable because we know that public issues are very complex and we just try to break it down into the simple facts and we also provide more complex analysis for state lawmakers or the city of seattle there are public officials who will contact us and say what are trends and property taxes how do i understand that so we have staff who can in just three or four pages explain very technical issues in simple terms and that's to help our government and as the vice president what is your primary role it's to oversee these seven analysts to make sure that they're doing their job so the interesting thing about a think tank is a person to be at their desk and are they working or are they being productive or what are they doing they're thinking exactly so we have many projects going all at once and again like any organization us what matters is the quality of the final product and that we means are you able to explain complicated issues in a way that the ordinary person can understand transportation mass transportation is a is a very big issue in any city and certainly seattle is one of those big cities that has transportation issues right and same point time king county's proposition  recently defeated supposedly sending a message what what was that message that the voters you think sent to in county about bus service yeah this is a great point so you were you were asked by washington policy center so bob who is our transportation analyst spent months working on this issue and he was able to you know break it down into different details and the common sense response is oh people don't want transit because they voted no on prop one but what bob noticed is that proposition one didn't offer people the public anything new it was adding two major taxes in order to preserve current metro bus service and that's what people didn't like people were willing to pay additional taxes if they receive additional service the whole dynamic of the prop one campaign was really threatening the public threatening bus riders that their routes would be cut to zero if people didn't vote for the tax and would bob found out is that most voters just they didn't buy that i mean they just didn't believe that and the reason they voted no was to send metro leaders back to the drawing board to come up with a better plan and hopefully metro will come up with something other than just canceling hundreds of bus routes are we seeing a change in this seattle and king county voter it used to be that just about any time that there was a social service public service type of vote it was always in favor of providing the funding right but or it was always in favor of preserving the status quo let me write it that way ok and with the seattle district vote which was a huge vote to create districts right was a definite sled if you will right and then this king county to feed we've also had school bonds that recently have gone down as well right and i think that what that means is that is that there are common sense limits what's interesting about seattle is that it is essentially a one party town so it's not like there's a political competition between democrats and republicans when you look at the u s congress that's what you see when you look at seattle it's not partisan and i think what people of seattle what these votes indicate that you mention indicate that there are kind of commonsense limits that people have they're upset that the schools don't produce better academic outcomes for students they're not that adding more money solves that maybe there are other reforms the district election i think it expresses the frustration of the massive development and changes people are seeing in neighborhoods where six storey condos are going up in residential areas and i think people want to send a local signal saying too much change too fast and if i had my own representative in ballard that person could explain that the development is perhaps too fast and with the problem one vote is people will vote for you know us like the the nine one one service we have a fingerprint computer system that the police use that's a separate vote people will vote for things like that if it's a small tax for a specific program the metro boat vote was a huge tax to only support an existing program and i think there's a matter of scale where people want to send a signal to limit the financial burden that the government places on people do we just have too many taxing authorities in king county anyway i mean there's something like thirty nine cities or there's a huge number of cities right in addition to taxing districts on top of that exactly so in seattle there are if the parks district passes that will make a levon taxing jurisdictions just in the city of seattle so that's where we're starting to get the sense that the public is saying enough that they will support things like parks and public safety social services there for that but they wanted to be funded in a commonsense way instead of fragment breaking up the governing jurisdictions each one layers of property tax and you know property owners get the famous postcard in the mail that tells them what their assessed value is and what their tax is going to be and it keeps going up and i as a voter in the city of seattle who love the place here i don't want to have a knee jerk reaction whenever i see another taxing vote but i'm almost there because i kind of i kind of want to know when is this going to stop yeah and so that creates a chip a chicken and egg problem because because what public official see in seattle is every time we put a new tax on the ballot it passes so that creates an incentive for them to come up with new taxes i mean they get rewarded because it creates an additional revenue stream so once in a while i think a no vote sends that kind of check which says to the city council you know don't raise taxes too much you know and the unfortunate thing is that i've always believed that the public schools are the are the foundation of any community  and we have had leadership change after leadership change after leadership change here what's going on there again another great issue and the reason is because it's not money so what so when we look at the seattle school budget it is not only the largest in the state but it has been increasing at a steady rate over the years seattle now spends about thirteen thousand dollars per student so they have the funding thirteen thousand dollars a person per year exactly on average so i think what this superintendents are frustrated with are the power of the seattle teachers union and all the rules and regulations that come with that and there was a big dispute over testing and there's still disputes over teacher firing bad teachers and teacher assessments and in the union to fight each of these battles but i think what the district administrators find is that their hands are so tied with one thing or another that when a superintendent finds a better offer in another community he goes there i think he finds that the work is easier someplace else than in a major dis like seattle we have a couple of minutes left and i want to be sure to get to this you as vice president and policy center over saying essentially the the substance of the think tank what keeps you up at night it  keeps me up is similar to what we've been talking about and that is the the rising financial burden of living in washington state because it's so slow and incremental that people don't see that it gets harder and harder to run a nonprofit run a business or just simply do any operation in washington state and the reason that concerns me is because our past was very dynamic and creative and in the area of high tech and medical we still do that but it just i think of it as sclerosis it's like it's like rust you know constantly meshing figures so that the average people person whether raising a family running a business trying to start a new company it just gets harder and harder because of all the regulations  and i just think that our leaders don't they don't see that growth and they think that twenty fourteen economy is the same as it was in you know decades past where we did so well and i think there may come a time when washington state is no longer the pioneer and engineering state the innovative state and that instead we just become the new california is starting to go through this right now so i'm worried that that will come here i really hate that that would happen though because there is such an entrepreneurial spirit and innovation spirit that is here i mean it's not just microsoft but i mean right here at the studio where we are we're inside a building at the impact of where the academic and intellectual innovation is here and i was a great spirit but if we can't afford it it has to do with just the simple administrative question of you know does the project pencil out you know it's just that simple people love living in this area we attract a lot of bright people we have a great university seattle and washington state are a gateway to the world and to world trade we always have been and so we have these great assets what i get worried about is that when a group of people get together and say ok let's do this investment that by the time they calculate all the taxes and the cost in the three years of permit in your whatever it is they need to do it just makes it harder to make each new thing happen we'll let that be the last word that's been paul guppy from the washington policy center i hope that is crystal ball is right on a