July 31, 2019

Dear City Councilmembers:

Seattle’s Small Business Community takes much pride in our contributions to this City. We
provide jobs, generate tax revenues, create memories, activate our streets, and serve as
neighborhood gathering places. We can only continue to play these crucial roles if we are
supported in our efforts to thrive and survive in the ever-challenging environment in which
we have built our businesses. The financial obstacles that have been imposed by the City
of Seattle are making it increasingly difficult for us to thrive.

We’ve recently become aware of proposed Council Bill 119555, which will impose a
significant health care expenditure requirement and put further regulations on small and
family-owned hotels and small businesses which simply happen to lease space from a
hotel. While we know the original initiative included more businesses than what your
legislation does, we do not believe your definition protects small, family owned Seattle
businesses. As members of Seattle’s small business community, we implore you to resist
passing this legislation without a more thorough examination of the impact and lasting
effect it will have on Seattle’s vibrant Small Business Community. We understand that your
objective was to implement the initiative passed by voters but we also understand that your
objective was to create responsible legislation that would not have unintended
consequences. We’re sorry to see that that did not happen. The Small Business Advisory
Council has members who would be faced with potential cost increases of upwards to
$600,000.00. Many small hoteliers imagine they would be forced to close within 2 months
of the legislation’s enforcement date.

The legislation the Council is currently considering makes no distinction between how
different types of hotels are able to purchase health insurance and imposes the same
requirements on a non-hotel employee who works at a café or retail establishment as it
does on a hotel employee. The draft claims it is meant to apply to large hotels, yet many
of the hotels are small and family- owned businesses, and it also applies to what it calls
“ancillary hotel businesses,” the definition of which is so broad it applies to businesses
simply because they may be tenants of hotels. These classifications of businesses are
fundamentally different and need to be treated as such. Even if these ancillary businesses
are “carved out”, the reality is that the Seattle economy is an ecosystem -- what affects
large businesses almost always affects smaller businesses, or trickles down to them.

The required health care expenditures in the proposal far exceed the coverage
requirements in the Affordable Care Act, and the resulting expense is not sustainable for
small businesses. It is those small businesses – many of them immigrant- and family-
owned – that we should be encouraging to grow and thrive in Seattle, not bringing in new
requirements that may force them to move or close their doors.

We urge the City Council to slow down, identify who this legislation will impact, and take
the time to understand the consequences. Small businesses are the fabric of Seattle.
These business owners live locally, support other small businesses, non-profits, schools,
and arts and cultural organizations. Their absence would leave an irreparable void in the
flavor of Seattle. We have already seen a departure of much of Seattle’s service industry
employees to Renton, Burien, Tacoma and Auburn/Kent. Without viable solutions, Small
Business owners and their businesses will follow. We also believe that business and
government should work together at the state level to find sustainable solutions to family
health care costs without putting the burden upon one specific industry which includes
small and family-owned businesses.

Please take time to reconsider and fully comprehend the impact on the beloved small
business community in Seattle before moving forward. We would be more than amenable
to engaging with you to offer a better understanding of the effects of this legislation.

Sincerely,
Joe Fugere, Small Business Owner, SBAC Co-Chair
Taylor Huang, Small Business Owner, SBAC Co-Chair
Donna Moodie Marjorie’s SBAC Co-Chair
Tracy Taylor, Elliott Bay Book Company SBAC Co-Chair
Shaiza Damji, Hotel Nexus, SBAC
Ryan Suddendorf, Co-Founder Arriba Cantina
Linda Di Lello Morton, SBAC
Tamara Murphy
Rachel Marshall - Rachel’s Ginger Beer, SBAC
Joey Burgess, Owner/Operator Burgess Hall.com, SBAC
Beto Yarce, Nonprofit leader and entrepreneur
Travis Rosenthal, Founder/Owner Pike Street Hospitality Group
Sara Nelson, Fremont Brewing
Jasmine Donovan, President & CFO, Dick’s Drive-In Restaurants
Dan Austin, Owner- Peel & Press (West Seattle)/Owner- Flight Path (Intentionally not in
Seattle)
Lei Ann Shiramizu, Momo in Japantown, SBAC