Here’s why the City of Seattle pays for raises for non-City employees

In July 2019, the City Council passed CB 119542, requiring an annual inflationary adjustment for nonprofit service providers contracting with the Human Services Department (HSD).

The bill’s Summary and Fiscal Note indicates that it’s a worker retention mechanism for nonprofits but in a press release after the bill passed, prime sponsor CM Teresa Mosqueda emphasizes its benefit to workers: “To solve our city’s biggest issues, we need a stable investment in our frontline workers – our human service providers – at least one that reflects the cost of inflation each year.”

Whether you’re reading the bill’s recitals, its fiscal note, or its sponsor’s words, the bill’s intention is clear: to enable nonprofits to increase the wages of their workers so they stick around (hence our use of “raises”).

The annual adjustment is tied to the CPI and that increase is 3.8% ($10.2M) in 2027 and 3.5% (projected $11.1M) in 2028.

The “wage equity” increase we’ve been hearing a lot about in public comment is a separate thing altogether, intended explicitly to increase social service providers’ wages. It comes from a resolution Council passed in June 2023 to align nonprofit social service workers’ salaries with those of workers in other sectors and industries (and it’s in addition to the inflationary increase).

The adopted 2024, 2025, and 2026 budgets included a 2% wage equity adjustment of about $5 million each year but it’s not included in the Mayor’s the proposed 2027 - 2028 budget.

That may change. CM Lin is proposing an amendment, HSD-053-A, to increase HSD’s budget by $8 million in 2027and $8.3 million in 2028 to provide a 3 percent wage equity increase for human services contracts” (see pg 38).

We’ll see what happens with the amendment when Budget Chair Strauss releases his proposed Balancing Package on November 3rd. For now, we wanted to provide some context to the growth in HSD’s budget over time (noted here).