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Seattle mayor wants to fund affordable housing by raising taxes on Lyft and Uber rides

A 51-cent tax would fund 500 housing units

Seattle wants to build more affordable housing. And to get that mission accomplished, the Emerald City could turn to rideshare services for the funding.  

Lyft and Uber riders in Seattle could see a potential 51-cent tax rise in fares after a proposal was made by Mayor Jenny Durkan last week. There is already a 24-cent fee for the rideshare consumer in Seattle. 

According to the Seattle Times, the total fee of 75 cents would still be less than a $2.75 fee in New York City, similar to a 72-cent fee in Chicago and higher than the 20-cent fee in Massachusetts.

Over the next five years, this proposal would put $52 million towards affordable housing, and build more than 500 housing units near transit, intended for people making between $15 and $25 per hour. 

Unsurprisingly, the rideshare companies (at least one of them) are unhappy with the proposal, arguing that the tax will increase costs for riders.

"Fifty-one percent of Seattle Lyft rides start or end in low-income areas, and the Mayor's regressive tax would increase the fees they already pay by 300%, making it the most taxed rideshare city in the country," Lyft spokeswoman Lauren Alexander said in a statement, according to SeattlePI.

In January, Microsoft pledged $500 million in an effort to fund affordable housing in the Seattle area. According to the Wall Street Journal, $475 million will fund construction loans for affordable housing in the area over the next three years and the other $25 million will fund grants to address homelessness.

Median home prices in the Seattle area have spiked 96% from 2011 to 2018, and median household income has risen 34%. Microsoft estimated there was a shortage of more than 300,000 housing units available for middle- and low-income families. 

The proposal would also put $56 million towards funding the Center City Connector Streetcar and $17.75 million for a new Driver Resolution Center. 

As soon as next July, a minimum pay rate for Lyft and Uber drivers could also go into effect, pending city council approval. 

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