Bartell Drugs says ‘enough,' proposed $100-per-worker tax could hurt company

By: KIRO 7 News Staff

Updated:

One of Seattle’s largest and oldest companies is telling the city council that “enough is enough” in taxes on local businesses. 

The chairman of 127-year-old Bartell Drugs wrote that paying a $100-per-worker annual tax could have dire consequences for its business and employees. 

What’s the proposed tax? 

Councilman Mike O'Brien says more money is needed to build upwards of a thousand new housing units over the next decade, plus fund emergency shelters and diversion programs to keep people off the streets and out of jail.

KIRO 7 News reported on Oct. 12 that O’Brien wanted more than the $63 million tax proposed by Mayor Tim Burgess.

"I'm talking about another $20 to $25 million," O'Brien said.
O'Brien wants to get that money from a new per-head employee tax on the biggest businesses in Seattle.

Any company grossing at least $5 million a year would pay about $100 per worker annually. O'Brien says it would apply to about 10 percent of companies.

Bartell’s letter to the council

KIRO 7 News obtained a letter that Bartell Drugs chairman George Bartell wrote to the Seattle City Council on Oct. 19. 

“I returned from a trip to find that there is a proposal for another, additional tax, on top of all of the other restrictions, requirements, and fees that have grown massively the past few years.  Enough is enough,” he wrote. 

“As a business leader I’m often asked what keeps me awake at night.  I say:  the City of Seattle’s actions that make it harder and harder to operate a business focused on serving our customers.

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“Headquartered in Seattle for 127 years, with a large share of our business done within City limits, we face the full brunt of your actions to an extent that does not apply to Walgreens, or even Amazon.  It has cost more than a million dollars to comply with initiatives passed during the past few years, and that is prior to the next phase of minimum wage and scheduling.  So, complying with the initiatives passed so far will cost us millions of dollars.  While “millions” might not be much for Amazon and Starbucks or the City, it’s definitely a big deal for us.  And, with a head tax, and our warehouse and headquarters both located in the City, we will face costs our competitors won’t.  

“I urge you to abandon the idea of a head tax.  We are a significant employer here in Seattle and we reached a breaking point on the City-imposed fees and costs.  Instead, I ask you to spend the money already raised for homelessness prudently and effectively and that you continue to partner with the significant number of non-profit organizations that are rallying to confront this issue.”

Bartell Drugs claims to be the nation’s oldest family-owned drugstore chain. Founder George H. Bartell purchased a Seattle drugstore in 1890, and over the last century it’s become a trusted northwest institution. 

Sixty-four Bartell stores now operate in multiple Puget Sound counties. Additionally, this year the store teamed up with Amazon to sell products through the Prime Now app so customers could take advantage of two-hour delivery. 

Downtown Association calls tax ‘puzzling’ 

The city had an employee head tax between 2006 and 2009, when it charged $25 per year per employee.

It was rescinded during the recession.

Jon Scholes of the Downtown Seattle Association told KIRO 7 News that businesses want to help the homeless, but are already are paying a lot to the city.

"Businesses paid more taxes last year than ever before in the history of this city," said Scholes, who called the tax “puzzling.”

"This proposal we think is really short sighted and comes at a time when Amazon is looking for a second headquarters, and this city's response is to tax jobs," Scholes said.

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KIRO 7 asked O’Brien about the proposal being anti-business and hurting jobs. 

"I don't think so, and that's certainly not the intent," O'Brien replied. "I want to be clear here, we're not trying to punish businesses at all."

O'Brien's cosponsor is city council member Kirsten Harris-Talley, who was appointed to fill Tim Burgess' position when Burgess became mayor after Ed Murray's resignation.

When was this discussed in council?

The Seattle City Council discussed the head tax during a budget hearing on Wednesday. Aside from O’Brien, Harris-Talley, and socialist city councilwoman Kshama Sawant, council members have publicly signaled that they oppose the current version of this legislation, according to SeattleMet

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