State to Benefit from Development at South Lake Union

SEATTLE – Development at South Lake Union will generate more than a half billion dollars in direct tax revenue to state government over 20 years, according to findings made public by Mayor Greg Nickels today.

The findings were released as an appendix to a report on South Lake Union by noted economist Paul Sommers.

The mayor announced the findings in Olympia in an appearance before House Telecommunications, Technology and Energy Committee legislators.

South Lake Union is fast becoming one of the nation’s leading bio-technology centers. In the appendix, Sommers found that development activity will generate up to $870 million in direct tax revenues to Washington State over the next 20 years.

“Jobs in South Lake Union are good for Seattle, good for the region and good for the entire state,” Nickels said. “We have a great opportunity to grow up to 76,000 new jobs by encouraging the life sciences and biotechnology industries in South Lake Union.”

The study, part of ongoing economic analysis by the City, identifies the taxes which are projected to be collected by the State of Washington. The study concludes that between $540 and $870 million will be generated for the State through property, utility, sales and business and occupation taxes between 2005 and 2025.

In December, the City of Seattle released the Draft Potential Economic and Fiscal Impacts of South Lake Union Development, authored by Sommers. The draft report estimated that the City of Seattle alone could realize $250 million in tax revenues from this economic activity. A peer review panel has been analyzing the report and requested that Sommers estimate the potential revenue to the state.

The draft report in December estimated total statewide jobs at 56,000. The latest review estimates statewide jobs at up to 76,000.

“This is a competent and well-researched study of the potential economic impacts of South Lake Union development,” said Irv Lefberg, chief of forecasting for the State’s Office of Financial Management and peer review member. According to Lefberg, this portion of the analysis “provides a reasonable and technically-sound estimate of the potential state revenue associated with development of the area over the next twenty years.”

For a copy of the appendix and details on development at South Lake Union, please visit www.cityofseattle.net/mayor.

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