EVERETT — The city’s controversial property tax increase appears headed for defeat after initial ballot counting Tuesday night.

Proposition 1 was trailing 59.75% to 40.25% in early returns.

It would have allowed property tax increases in 2025 to surpass the state’s 1% limit, from a levy rate of $1.52 per $1,000 of assessed value to $2.19, a 44% rise.

City officials estimated property taxes for the average Everett homeowner would have increased by $28 per month.

Everett officials said they have been fighting budget deficits for 20 years. They forecasted a $12.6 million deficit in 2025, which is expected to rise to $35.4 million in 2030.

Before the election, spokesperson Simone Tarver said city leaders don’t intend to cut police or firefighter positions if the measure doesn’t pass. Late Tuesday, Tarver said city officials have acknowledged addressing the deficit will require cuts to all city departments.

However, city officials have acknowledged cuts to other departments will likely impact police and fire workloads.

Property taxes make up 35% of Everett’s tax revenue. City staff said this increase would remedy the deficit for the next three years, supplement police and fire budgets, and allow them to restore some past cuts to libraries and staffing as well as “explore” reopening the Forest Park Swim Center.

Mayor Cassie Franklin and every council member, except Judy Tuohy, endorsed the measure, as did the police and firefighter unions.

“I’m sad to see Everett voters deciding against Proposition 1, a sustainable funding option, as this will impact our community in negative ways,” Franklin said in a statement Wednesday morning. “I respect the voice of the people and in the coming months, we will work together on the likely painful decisions necessary to cut $12.6 million from the 2025 budget.”

The apparent defeat comes after weeks of debate.

Lift Up Everett raised $7,000 to advocate for the increase, funded by police, firefighter and city staff unions.

On the other side, Keep Everett Affordable denounced the proposal, raising $32,500 for a rigorous yard sign and mailer campaign. Real estate interests contributed heavily to the group.

Opponents argued the City Council hadn’t done enough to reduce expenses prior to introducing the measure, pointing to significant increases in human resources and administration budgets.

“The defeat of Prop 1 is a huge win for working families in Everett,” Keep Everett Affordable treasurer Michael Swanson wrote in a statement. “This was a very decisive message to the mayor and council to revisit balancing the budget without putting it on the backs of people already struggling to make ends meet.”

Critics also expressed concerns the additional taxes would disproportionately impact the working class.

Proponents disagreed, citing budget cuts that slashed recreation programs, like the Forest Park pool and city staff benefits. Any more, they said, would harm Everett’s quality of life.

Advocates said deferrals and exemptions are available for seniors, veterans and disabled people to mitigate the financial impact.

This one-time increase would have taken effect in 2025, then return to its previous 1% limit.

Both sides encouraged Everett residents to provide input when deciding what should be prioritized in next year’s budget. City staff said an outreach process will be launched in the coming days.

“It is my hope that the Mayor and the Council will listen to the community and begin that budget review to find cost savings that will maintain quality of life in Everett without sacrificing essential public safety,” former City Council member and 2025 mayoral candidate Scott Murphy said. Murphy was one of the tax measure’s most vocal critics.

In Mukilteo, a similar levy lid lift was in a tight race, with 48.09% in favor and 51.91% against. This proposal would raise property taxes an estimated $180 per year to fund emergency medical services.

This article has been updated with comments from Everett Mayor Cassie Franklin and Keep Everett Affordable treasurer Michael Swanson.

Connor Zamora: 425-339-3037; connor.zamora@heraldnet.com; Twitter: @cgzamora02.