At a packed city council hearing on the proposed housing levy last night, the crowd was stacked in favor of raising property taxes for housing. The real issue facing the council is how much to ask voters to raise taxes and how poor, specifically, a person must be deserve subsidized housing.

The mayor’s office two weeks ago proposed keeping the levy at its current 17-cents-per $1,000 level, which would increase the total it would raise to $145 million (more on that here), maintaining the same level of housing assistance as the levy passed in 2002. The levy would raise taxes for the average property in Seattle from $49 to $79 a year.

Many people wanted a larger levy. Neatly dressed housing nonprofit professionals and activists argued the city should increase the levy to $167 million. Seniors wait months or years for low-income housing, artists are out of work and struggling to survive, and the levy would help the struggling construction industry.

The speakers looked like Emerald City extras in The Wizard of Oz. Of the 70 people signed up to speak, most wore green cotton armbands. “We are asking you to green-light this levy to help bring [homelessness] down,” said Alison Eisinger, director of the Seattle/King County Coalition on Homelessness, wearing a green shawl and holding an apple-green flashlight. Next to her, a woman wore shiny green galoshes and a green hooded vest.

The rest of the debate hinges on who gets the subsidized housing. Unlike the levy passed in 2002, this levy proposal doesn’t say how much of the money goes to some of the poorest people in the city. The 2002 levy prescribes the percent of the funds must be spent providing housing to people in specific income brackets. For example, it reserves roughly half of the money for people making less than 60 percent of the area median income (a person making under $35,400 would qualify for a studio apartment that rents for less than $885 a month). This year’s levy proposal contains no such language—only that about half of the housing be built for those making 80 percent or less of the median income ($44,800 a year for one person in a $1,120 studio apartment).

“Some taxpayers could be concerned that people making close to the median income shouldn’t be getting subsidized housing,” says David West, director of Northwest Sage, a housing and labor nonprofit organization. An ad hoc coalition of dozens of housing advocates, including David Bloom, running for Drago's soon-to-be vacated council seat, sent a letter to the council yesterday demanding that they specifically dedicate levy amounts to very low-income people.

But Adrienne Quinn, director of the city’s Office of Housing, points out there is some risk in getting specific about who gets the dough. As several low-income housing developers attested, they would benefit from flexibility in the levy funding, which allows greater ability to leverage the money to apply for state and federal grants—which would result in more housing overall. “If we carve up the levy too much for a matching funding source, it could go unspent,” Quinn says. She adds that the city intends to make sure the housing goes to the poorest residents, as it did under the last levy.

“People making 30 percent of the area median income should get the lion’s share [of the levy funds],” says West. “I am less concerned about the flexibility and more concerned about making sure these people get housing.”

The room’s lone dissenter was Rusty Williams, who is running for the soon-to-be-vacated seat held by Richard McIver, who chairs the city’s housing committee. Williams’s argument came off as a disingenuous campaign ploy disguised as belt-tightening populism. “I support the housing levy, but I want to remind you that we are in a recession,” he told the council (Jan Drago was absent). “Raising taxes is fiscally irresponsible. I am asking you to cap the levy at [its current total of] $86 million. And when the economy turns around, we can get the housing that the homeless need so badly. Show that the smart decisions at City Hall are made on the second floor.”

What Williams didn’t acknowledge is that capping the housing levy at $86 million would, in fact, reduce housing support for the neediest people in a recession, because there’s this weird thing called “inflation.”