Mayor McGinn: Seattle’s economic picture brightens

Seattle rainbow

Things are looking up in Seattle, and Mayor Mike McGinn is touting the improvements. In a press release today, McGinn said that revenue collections for 2012 are trending ahead of forecast by about $7.6 million. The job picture also is looking better.

“Seattle got hit hard by the recession, and though we’re not all the way back yet, we are starting to make measurable progress,” said McGinn. “This will help us protect and in some cases strengthen the core services that contribute to making Seattle a great place to live and work.”

McGinn said that employment growth in the Seattle metro area is up 6.6 percent since the end of the recession, which compares to growth of 3.1 percent for the U.S. and 1.9 percent for Washington state. The tech industry certainly is doing its part, with companies such as Amazon.com, EMC/Isilon, Tableau, Zulily and others hiring at a brisk pace.

Meanwhile, taxable sales growth is up 13.2 percent from first quarter of 2010 to the first quarter of 2012.

Here’s more from the release:

This local strength has had positive results for the City’s current-year revenue collections, particularly sales tax receipts. Collectively, actual revenue collections for 2012 are trending ahead of forecast by about $7.6 million. This is driven in part by economically-driven growth such as sales tax. Taxable sales in the construction industry are up 34%, driven mostly by apartment construction. Real Estate Excise Taxes are up, as are B&O taxes. City revenue collections are further enhanced by one-time, non-economic boosts to current year revenues from things like the City’s share of liquor store proceeds following the privatization of liquor stores in Washington State. The revenue picture is also helped by the anticipated increase in the county EMS property tax levy rate for 2014.

Taken together, the City’s revenue forecast adds $11.4 million in additional revenue to the City through 2014. This forecast will help the City work to close the previously projected $32 million General Fund budget shortfalls in each 2013 and 2014. Other factors helping our outlook include the passage of the Library Levy, cost savings negotiated with firefighters, and the conclusion of negotiations with the Department of Justice.

However, overall economic forecasts for 2013 and 2014 remain uncertain. Slow economic growth due to federal budget cuts, ongoing problems in the Eurozone, and rising energy prices mean that tax revenues may drop in coming years.