AN ORDINANCE relating to taxation; delaying the effective date of the heating oil tax on heating oil service providers under Chapter 5.47 of the Seattle Municipal Code; and delaying the date of the Office of Sustainability and Environment’s first annual heating oil tax program status report.
Agenda Item 16 Capital 119859 Believe to taxation delaying the effective date of the heating oil tax on Heating Oil Service provided and provided under Chapter 5.47 of delaying the date of the Office of Sustainability and Environment First Annual Heating Oil Tax Program Status Report. Thank you, Madam Clerk. I need to pass Council Bill 119859. Is there a second second? Again. It's been moved and seconded to pass the bill. Councilmember Morales, I understand you are the sponsor of the bill, so you are recognized in order to address this item. Thank you. Yes. So Council Bill 119859 would delay for one year, as I mentioned this morning. The effective date of the heating oil tax that was adopted in 2019. As I said, the intent of the original ordinance was to tax heating oil in an effort to accelerate the rate of conversion from oil heat to electric heat pump systems. In response to community feedback about the impacts of this tax on low income and middle income households, particularly during COVID, O.C. is proposing, we delay implementation for one year. And just to give you an example of why this could be cost prohibitive for many families, we know that the average cost to convert oil to electric heat and decommission an oil tank is about $13,000 per tank. And that doesn't include the costs for clean up if those tanks have leaked under somebody's home. So that can run 40, $50,000. So this is really especially when some of these homes that have oil heating are very old and there's a high likelihood that these tanks could potentially leak or be damaged in transition. It's important that we take a pause on implementing this tax so that we set up systems to be able to support families better. The is the memo that you all received indicated we are also looking at some possible changes to the Pollution Liability Insurance Agency. I'll talk about that in a moment with the amendment. But we do want to make sure that families are getting all the assistance they can with loans or grants to be able to afford the cost of making the switch. And until we've got those set up, we want to push back the start date of this for a year. Great. Thank you so much, Councilmember Morales, for that description of the underlying bill. I do understand that you have an amendment, as you just alluded to. So why don't we go ahead and address the amendment first and then we'll have an amended version of the legislation before us, and then we can open it up for questions on the bill as amended. So I move that we amend Council Bill 119859. Is there a second? It has been moved and seconded to adopt Amendment One. Morales. Please feel free to address Amendment One. Thank you. So this amendment would request that the Office of Sustainability in the Environment provide a status report to council by June of next year, June 1st, 2021, regarding the rulemaking for the Pollution Liability Insurance Agency's new Heating Oil Loan and grant program. We are especially interested in how that program will avoid creating undue economic hardship on low and middle income homeowners with oil, heat, and how the city will implement the Heating Oil Tax and home conversion program to protect low and middle income homeowners from undue hardship. Additionally, the report should include a summary of feedback from key stakeholders about whether the effective date of the tax should be September 1st, 2021, or if there should be an additional delay at that time due to economic conditions or the status of COVID. Who knows where we will be next summer or any other factors that might be in play at that time? Thank you, Councilmember Morales. Are there any questions on questions or comments on Amendment One? Okay. Hearing none. Well, the clerk please call the role on the adoption of Amendment One. Strauss. Yes. Herbals. Yes. Whereas. Yes. Lewis. Yes. Morales. Petersen. Yes. President Gonzalez. Yes. Even in favor not oppose. The motion carries in. The amendment is adopted. And now we have an amended version of the bill in front of us. So are there any further comments on the bill as amended? Caring Land Councilmember Herbold. We appreciate it. I just wanted to for a little bit of history around amendments that I offered when we first pass this legislation last year. I, like Councilmember Ellis, was very worried that the legislation would have a negative impact on seniors and low income people, since they are most likely to have their homes heated by oil. And so I have proposed an amendment to address these concerns, and they were supposed to report back to us on their impact, on their analysis of the impact of the bill on seniors and to fully fund conversions for low income households. I also proposed an amendment to delay implementation of the tax from July 1st to September, September 1st. So here we are. Further, further delay, delaying implementation and still razor laser focused on trying to find out more about what the impacts would be on seniors and low income people who are most likely to have their homes heated by oil. And really appreciate Councilmember Rouse's amendment and bring the legislation forward so we can ensure that the Council will receive a status update in advance of. September 1st, 2021. Thank you for those comments, Councilmember Herbold. And I also appreciate Councilmember Morales bringing this forward in conjunction with the Office of Sustainability and Environment to make sure that we are in a now these period of time where the economy is so uncertain. It is even more important for us to make sure that we have all the relevant information before us to understand any disproportionate impact that may result and unintentionally and unintended by this particular council bill that we passed last year. So appreciate. Appreciate you bringing it forward. Are there any other comments on the bill? Councilmember Morales, anything else to add? I think we're good. Okay, great. With that being said, I'd ask that the clerk please call the role on the passage of the bill as amended. Strauss. Yes. Herbold. Yes. Suarez. Yes. Lewis. Yes. Morales. Yes. Peterson. Yes. President Gonzalez. Yes. Levin. In favor and unopposed. The bill passes as amended and the chair will sign it. Will the clerk please affix my signature to the legislation on my behalf? Item number 17 Will the clerk please read item 17 into the record?