Dear Friends and Neighbors,
The special session ended in the late afternoon on November 9 following the passage of two pieces of legislation aimed at helping our aerospace industry and securing the production of Boeing's 777X in our state. I voted for both bills, which were signed into law November 11.
With the Legislature's work completed, attention turned to the International Association of Machinists and Aerospace Workers' (IAM) contract vote with Boeing on November 13. In a vote that reverberated across the country, the IAM soundly rejected the contract offer by a 67 percent vote. In a question and answer document posted online the next day, Boeing made it clear that it will not re-engage the IAM on contract negotiations until 2016 and it will review 777X options in other states. According to a Puget Sound Business Journal article today, Boeing expects to make a decision in the next two to three months.
Whether you feel the IAM turned down a good offer or Boeing asked too much from the IAM (and I have heard from people on both sides of this issue since my last e-mail update) there is one thing everyone can agree on: the future of the aerospace industry in our state is uncertain. A recent Crosscut column highlights this uncertainty, while a Washington State Wire article discusses how the IAM's vote might impact issues such as transportation, fish consumption and workers' compensation in the Legislature.
One special session, two bills
The third special session of 2013 produced two bills. The first measure, Senate Bill 5952, would extend the expiration date of existing aerospace tax incentives from July 1, 2024 to July 1, 2040, upon the siting of a significant commercial airplane manufacturing program in Washington – including a carbon fiber wing manufacturing program. It would also expand the availability of a sales and use tax exemption for the construction of facilities used to manufacture commercial airplanes. You can find specifics here.
The second piece of legislation, House Bill 2088, would expand our state's investment in aerospace education and workforce development and increase enrollment in related fields at community and technical colleges. It would also provide grant money for local governments to assist in paying for environmental permitting activities for large manufacturing sites for aerospace and other key economic growth centers. You can find more details here.
Despite the governor's wish, state lawmakers did not consider a transportation revenue package, which includes a state gas tax increase. We can expect this issue to resurface this week. The latest proposal would raise the state gas tax by 11.5 cents per gallon. I continue to believe this would financially hurt those who are struggling – including families and businesses. Our state does not have safeguards in place in the Washington State Department of Transportation to ensure gas tax dollars will be used efficiently and effectively. I can't consider asking you to pay more at the pump until I can ensure there would be accountability with those gas tax dollars.
I think there are two key takeaways from the recent special session. The first: the special session and IAM vote shined a spotlight on how hard it is to do business in our state. As other states actively recruit our employers, we are in a crisis mode. This crisis mode led to a hastily-called special session, rushed legislation and the public being shut out of the legislative process. Our state needs to be proactive – not reactive – when it comes to improving its business climate and sending the right messages to employers. And, we need a transparent citizen Legislature.
The second takeaway: the end of the special session should be the starting point for an important dialogue on how we can help all sectors of our economy. As one of my colleagues said, “If it's good for Goliath, it's good for David.” In other words, if we are going to help Boeing with tax incentives and their permitting processes, we need to help small businesses with tax incentives and their permitting processes. There are solutions on the table and I expect there will be more. It is just a matter of moving them forward.
State lawmakers will be back in Olympia this week for committee assembly days. If you would like to follow the action on TVW, you can find a schedule here. If you have any questions or comments, please contact me.
In your service,