What’s the rush, some ask about Boeing’s demands

Legislators to return Thursday to consider company’s requests they know little about

bshannon@theolympian.comNovember 7, 2013 

In a state where the Boeing Co.’s political clout is legendary, lawmakers return to Olympia on Thursday to answer the company’s latest wish list — even though some aren’t sure exactly what’s on the agenda or why it has to happen now.

Gov. Jay Inslee says more than 50,000 jobs are at stake in the long term if lawmakers do not extend tax incentives for aerospace companies through 2040. In exchange for building its planned 777X jet in Washington, Boeing also wants new investments in workforce training, a transportation tax plan and a streamlined permit program for manufacturing facilities.

Rank-and-file lawmakers had received little information Wednesday about what they were going to be asked to approve over the next week.

That raised questions for Rep. Steve Kirby, D-Tacoma, that were only underlined by new uncertainty Wednesday about whether Boeing had already pledged the 777X work to its machinists union without waiting to see what the Legislature would do.

“It makes me wonder, what’s the big hurry? Why are we calling everybody into session two weeks before we’re going to be down there anyway?” Kirby said. Lawmakers had been scheduled to gather for committee work in late November.

Language in a contract ratification packet for Boeing’s machinist employees says the aerospace company is agreeing to assemble its 777X planes and build a wing assembly plant in Washington if the union members ratify the contract next week.

It says nothing about the deal also being contingent on the tax incentives plan that could save aerospace firms $8.7 billion over 16 years — nor does it talk about transportation taxes.

Details of that contract sent Inslee’s staff scrambling Wednesday, and Ray Conner, chief executive for Boeing Commercial Airplanes, sent Inslee a short letter attempting to clarify the situation. But the letter is silent on whether the company would change its plans if the Legislature fails to act.

“Pursuant to our discussions this week, Boeing is committed to placing 777X final assembly and wing fabrication in the Puget Sound region,” Conner wrote. “This commitment, however, will be solidified if the International Association of Machinists and Aerospace Workers (IAM) District 751 contract proposal is ratified in a vote by the membership next week and favorable economic incentives are implemented by the State of Washington.’’

Boeing spokesmen said later that Conner’s statement is all they’ll be saying for now.

And Machinists spokesman Bryan Corliss said the union believes the Legislature’s action is needed to cement the company’s commitment. He said 10 members of the union are headed to the Capitol to lobby lawmakers individually for the tax incentives as well as a transportation package on the session’s first day.

“Any suggestion we think legislative action isn’t necessary is just wrong,” Corliss said. “We think this is essential.”

Lawmakers return to session at 9 a.m., and some lawmakers predicted it wouldn’t be difficult to win agreement on tax incentives, permitting changes and worker-training measures.

But neither the Senate nor House has a plan to pay for transportation improvements that could win approval. The House voted for a gas tax and fee package worth about $10 billion earlier in the year, but it stalled in the Senate.

Both Sen. Rodney Tom, a Democrat who leads a mostly Republican majority in the Senate, and Rep. Pat Sullivan, majority leader for the Democrats who run the House, said transportation taxes could wait.

“I think what Boeing needs is … a tax incentive package and the workforce training (investment). The secondary issue is they want the transportation,” said Sullivan, D-Covington. “I think they understand it won’t be part of these immediate actions.’’

“The goal is to be united,” Sullivan added. “We want to send a message to Boeing this is a good place to do business.”

Members of the ruling Senate coalition expressed similar sentiments. Sen. Bruce Dammeier, a Puyallup Republican, said he sees potential for the deal to be “very good for Washington state and for Pierce County” as long as its effects go “beyond Boeing” to address the economy more broadly.

A proposed expansion of community college enrollments, he said, should benefit two-year colleges around Puget Sound, not just near Boeing’s main plants.

It’s still unclear where in the state Boeing would build its composite wings. Boeing hasn’t said, according to the governor’s office. And Pierce County lawmakers were not demanding any guarantees that the wings would be built in Frederickson, where major components of the traditional 777’s metal wing are built.

“I don’t think there’s any chance that we’re going to get those guarantees in a package,” Dammeier said. “That’s a Boeing decision. I respect their right to make that decision. At the same time, I want to make sure we’re putting Frederickson in the best possible position to compete for that work.”

While some lawmakers see nothing wrong with quick action on Boeing’s demands once details are clear, others worried.

“There’s a little bit of a sense of doom … that we are going to be expected to vote on some very significant bills without having seen them,” said Sen. Jeannie Darneille, D-Tacoma.

One key question waiting to be answered: How will incentives be linked to Boeing keeping its work in Washington?

House Finance Chairman Reuven Carlyle, D-Seattle, said there would be “a very direct and tangible linkage” between the two.

“The governor is incredibly sensitive to this,” Carlyle said, “and the administration is working very hard to craft a bill that has a strong win-win-win between the company, the people of Washington and jobs.”

Brad Shannon: 360-753-1688 bshannon@theolympian.com

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