Council passes new independent Office of Economic and Revenue Forecasts out of committee

Yesterday afternoon the City Council voted to pass out of committee an ordinance creating a new Office of Economic and Revenue Forecasts and a Forecast Committee to oversee it — an ordinance that likely violates the City Charter.

In response to an SCC Insight article raising the legal issues with the Council passing this ordinance when a charter amendment is required, Council President Gonzalez, the sponsor of the bill, addressed the issue in her committee:

“Based on my review of the analysis conducted by our City Attorney’s Office, again, we are able to establish our own independent office in a manner consistent with our City Charter and with applicable state law under the budget authority act, and the legislation we are considering today is reflective of the back-end review of our City Attorney’s Office. And specifically I just wanted to spend a little bit of time talking about that particular analysis. We know that the Budget Act does address several aspects of how we in the City of Seattle engage in our budget process. And upon reviewing the legal advice from our City Attorney’s Office it is very clear to me that this ordinance as proposed does not run afoul of the Budget Act or any of the provisions within the Budget Act that would water down or otherwise encumber the authority of the Council as the budget appropriation authority or the Mayor in her ability to propose a budget. And so this ordinance falls squarely within the bounds of the laws of the Budget Act at the state level.

In terms of the City Charter and the creation of ours I think it’s important to remember that King County created a budget forecasting office that required amendments to King County Charter Article 310,  because the King County Charter, unlike Seattle’s charter, by default places all executive departments in the Executive Branch. Seattle’s charter again has no similar provision. There is no Executive Branch as the King County Charter uses that term in our charter. In our case the Mayor and City Council share legislative power under Seattle’s charter, and that is found in City Charter Article IV, Section 1. In addition within the charter we see that our charter allows the legislative authority of the city, which again includes the City Council and the Mayor by definition in our charter, to create departments, unless the charter says we cannot do so in particular areas.

So again, I just wanted to make sure that Councilmembers you and members of the public understand the authority of the Council to pursue this particular ordinance as we have, and to make sure that members of the public understand why we are doing this by ordinance as opposed to a charter amendment, and the bottom line is that our city charter does allow us the authority by ordinance to create a forecast council, to create this new office, and to have it be a shared responsibility between the Executive and the Council.”

Gonzalez is taking great liberties in her interpretation of the City Charter, so let’s review the several provisions in the Charter that apply.

Her argument seems to be rooted in two sections of the Charter:

  • Article IV, Section 1.A: “The legislative powers of The City of Seattle shall be vested in a Mayor and City Council, who shall have such powers as are provided for by this Charter” — which she argues enables the Council and Mayor to create a new department that implements a legislative function such as the writing of the city budget, presumably so long as the governance of that department is shared.
  • Article III, Section 1: “The Legislative Authority of the City may by ordinance create, consolidate and reorganize the departments, divisions and offices of the City for the conduct of municipal functions except as such creation, consolidation or reorganization shall be precluded by other provisions of this Charter.”

Gonzalez also says that unlike King County’s charter, there is no provision in the City Charter that by default places all departments in the Executive Branch. But she is wrong: Article V Section 2 reads, “The Mayor shall see that the laws in the City are enforced, and shall direct and control all subordinate officers of the City, except in so far as such enforcement, direction and control is by this Charter reposed in some other officer or board”. Together with Article III Section 1, this means that the Council may create a new department, but it must report to the Mayor; only departments specifically allowed in the City Charter may have a different reporting structure or be independent. The two departments that currently report to the Legislative Branch, the City Auditor and City Clerk, are both recognized in the City Charter as such; as are the independent departments for the City Attorney, the Planning Commission, the Districting Master hired by the Districting Commission, and the Library (which reports to an independent board).

That’s not the only issue that the Charter creates. Article III Section 3 reads: “no head of department shall have or exercise any power or authority not provided for elsewhere in this Charter.” By creating a new department, intentionally independent of the Executive and Legislative branches, and granting the Director the authority to designate an official revenue forecast for the city (which becomes official in the absence of contrary action by the Forecast Committee) it is granting a power to that department head not provided for in the Charter. For that matter, the Charter makes no mention of an Official City Revenue Forecast at all; that power (to the extent that there is such a notion as an officially-blessed forecast) currently resides with the Finance Director (reporting up to the Mayor) because Article VIII Section 1 of the City Charter provides for a Finance Director and allows the Council to assign his or her responsibilities and powers by ordinance. The Council is empowered to grant the Finance Director the power to create official forecasts; it is not empowered to grant that power to a new department head not listed in the City Charter.

These limits aren’t arbitrary. They go to the very purpose, and indeed the heart, of the City Charter: the people of Seattle have set the boundaries of the powers of the Legislative and Executive Branches of city government, and neither branch (nor the combination) may alter those boundaries without the people’s consent. The legislative branch may not arrogate power to itself from the executive branch, or vice versa. Nor can either branch invent new powers and grant them to themselves or another branch; they may only wield and exercise the powers specifically granted to them in the Charter. They also can’t horse-trade their respective powers and authorities between the branches to create an arrangement more to their liking. They can, however, propose any such change and ask the people of Seattle to approve it with a charter amendment.

A rational elected official would recognize that pushing through such a change by ordinance, rather than the required charter amendment, is an affront to the people of Seattle — even if it were in a “grey area” of the law (which it isn’t). It is in effect saying that their desire to arrogate power to themselves is more important than the right of the people to approve such changes. Moreover, this is a dangerous precedent to set that will no doubt lead to more attempts to wrest power away from a Mayor often at odds with the City Council.

Strangely, it would have been simple for Gonzalez to propose it as a charter amendment instead; it would only be a small change to the ordinance she has already drafted, and the Council could have quickly certified it for the November ballot.  When King County passed its charter amendment to establish an independent forecasting office, the measure passed easily; in fact, no one even bothered to write a “statement against” for the ballot guide. There’s no reason to believe a similar Seattle charter amendment would fare differently. Gonzalez did mention yesterday that she hopes to have this take effect in time for this fall’s 2022 budget process, though in practice that’s a pipe dream: assuming the Mayor signs it (not a sure thing), it would take effect 30 days later; that’s the end of August at the earliest. There are some 2021 budget appropriations for extra staff to provide more capacity in the new Office to assist Councilmembers with revenue estimates for their tax proposals, but filling those positions will likely take months — starting with the new department head, who must be appointed by the Forecast Committee. So unless Gonzalez and Mosqueda plan to pick a fight over projected payroll tax revenues this fall, there will be little to no effect of the new Office of Economic and Revenue Forecasts until next year.

Instead, we have a Council President unapologetically showing her authoritarian streak by asserting unilateral legislative branch authority to create a new, independent city department partially under its control, in contravention of the City Charter.

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