The City of Shoreline, like most cities in Washington, faces a structural imbalance in funding core operations, where the cost of maintaining services is growing faster than the revenues available to support them.

In 2014, the City Council developed a 10 Year Financial Sustainability Plan that identifies seven strategies to help achieve financial sustainability over the 10 Year forecast. Five of the seven strategies have been implemented, and the City forecasts sufficient revenues through 2021, primarily relying on a voter-approved levy lid lift that expires in 2022.

One of two remaining strategies to be implemented is engagement of the business community regarding the potential implementation of a business and occupation (B&O) tax.

Business Outreach Workshops

Two workshop sessions were held in June 2017 for businesses to provide information on the City’s financial forecast and budget, and to collect feedback on the potential B&O tax.

Business Outreach Workshop Presentation


The City of Shoreline provides many services supported by its operating revenues. Video of City services.

The City of Shoreline currently does not have a B&O tax, however State law allows cities to levy a business and occupation (B&O) tax rate of up to .002 applied to gross receipts. Currently, 44 cities in Washington, many of them in the Puget Sound region, impose a B&O tax.

A B&O tax can be calculated several ways: by gross receipts, the number of employees or number of hours worked, or the square footage of physical locations and/or facilities. The tax may be simple – based on a single, easily calculated factor like number of employees, or a more complex factor like square footage. Some cities use a combination of factors.

State law requires cities set a small business exemption threshold of at least $20,000 in gross receipts. All businesses with gross receipts less than this amount are exempt from paying a B&O tax. Cities have the authority to set the exemption threshold higher and city thresholds vary greatly, from a low of $20,000 to a high of $1,000,000.