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Grandson of Dick's Drive-In founder says Seattle 'head tax' will hurt small businesses, not Amazon

Business
Saul Spady, the grandson of the founder of Dick’s Drive-in, slammed Seattle city leaders for a new “head tax” that places a five-year tax on nearly 600 businesses in Seattle. Spady said the tax will hurt smaller businesses much more than corporate giant Amazon. (Image source: YouTube screenshot)

Saul Spady, the grandson of the founder of Dick’s Drive-In, slammed Seattle city leaders for a new “head tax” that places a five-year tax on nearly 600 businesses in Seattle that gross $20 million or more per year, according to published reports.

How much is the tax?

The head tax, approved Monday by the city council, will collect about $47 million per year, or $250 per employee. Spady has criticized the plan since it was first debated, according to published reports.

Dick's Drive-In is known for doing charity work, paying good wages and having employees who take their jobs seriously, Spady told KING-TV. He has criticized the proposal since its early stages.

He said poor planning and decision-making by the city is adding to the problem.

Spady said the city has increased its budget by 32 percent in the last four years, and has doubled the amount it spends on homelessness, which does not “have a good return on investment.”

In contrast, Dick’s Drive-In has worked with other businesses on a program called ‘No Child Sleeps Outside’ that helps Mary’s Place, an agency that spends about $8 million a year running about 700 emergency shelter beds, Spady told the TV station.

The city has a plan that provides about 350 beds at a much higher cost, he said, adding that its plan for more affordable housing is also inadequate.

“They’re saying they’re going to get 1,500 affordable housing units, but we probably need 15,000 affordable housing units,” Spady said.

Instead of mandating that the government is only one that can build the housing, they could have allowed companies to build buildings with dorm-style housing for people who don’t own cars, he added.

“This is a tax on high-volume, low margin businesses like restaurants,”Spady said. “And that’s where it’s going to put the most pain.”

The media has repeatedly focused on how the tax will impact Amazon, which is expected to become a $1 trillion company in 2018. But Spady said it is the 599 smaller business that will suffer the most from the tax.

What does the future hold?

The tax is forcing businesses like Dick’s Drive-In to question how to make its workforce more efficient, he added. One of those questions involves whether the business can continue to operate in Seattle.

"Let’s be honest,” Spady said. "We’re not going to build another Dick’s Drive-In in the city of Seattle in my lifetime, in all likelihood."

Dick Spady founded iconic Seattle business in 1954.

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