Gov. Jay Inslee and legislative leaders appear at a post-session news conference Saturday.
OLYMPIA, Nov. 10.—Washington lawmakers say they did their part to keep Boeing from jetting, and now it’s all up to an angry Machinists Union to decide whether aerospace will continue to be a leading engine of the state economy.
Lawmakers Saturday approved a pair of bills that pave the way for Boeing’s next-generation airliner, the 777X, to be built in the state of Washington. But given all the talk on the House and Senate floors about the importance of the aerospace industry to the entire state of Washington, Gov. Jay Inslee appeared to tiptoe around the real decisionmakers – the members of the International Association of Machinists and Aerospace Workers, who will vote yea or nay on a new labor contract that goes before them Wednesday.
At a news conference that followed adjournment of the special session Saturday, the Democratic governor ducked several opportunities to call directly and bluntly for the Machinists to approve the new labor agreement. He described the union vote as a private matter. “Look, these are hard decisions that people need to make, and we are going to respect their decisions,” he said.
For all the fuss at the statehouse the last couple of days, the special session that ended Saturday is a sideshow to the vote that will take place at Machinists Union halls later this week. The union’s 22,000 members will decide whether to extend a labor contract that contains a no-strike clause, and which will require them to make significant concessions on health and retirement benefits. The deal, negotiated by representatives of the international union, has left the rank-and-file in a furor. Yet without the labor deal, Boeing says it will depart for sunnier climes. And with that new airliner may go the heart and soul of an industry that generates more than 11 percent of the state’s gross domestic product, thousands of jobs and billions of dollars of revenue for state government and the Washington economy as a whole.
So it was a curious scene as Inslee gathered with legislative leaders in the conference room of the Capitol building after the session ended late Saturday afternoon. In the softest possible terms, the governor appeared to say he hopes the Machinists will approve the contract, without saying it directly, and he avoided saying anything that might give offense. “These are the best aerospace workers in the world,” he said. “These are the people the Boeing Co. can count on to have a reliable timely-produced aircraft. They deserve the state to step up to the plate to give them a partnership, and we have delivered that. So I think we have to be proud of this. Now they are going to make their decision.”
Turns Legislature Upside Down
“If we can save Goliath, we can save David, too.” — State Rep. Matt Manweller, R-Ellensburg, declares House Republican support for Boeing bills Saturday, but urges more comprehensive efforts for business in future sessions.
Though the special session officially opened Thursday with a series of committee hearings on the Boeing bills, for most lawmakers it was a single day of work. The floor sessions Saturday were the first time the Gang of 147 had gotten together since they adjourned in June. They passed bills that streamline the permitting process for new aircraft factories and extend current aerospace tax breaks into the distant future. The tax-break measure, worth $8.7 billion, extends current preferential rates to the aerospace industry through 2040; otherwise they expire in 2024.
The floor debate reversed the usual flow of argument. Normally it is the Republican team that argues for streamlining permitting processes and it is the Democratic team that points to the horrors of business tax breaks. This time many of the more conservative members voted against the measures – not because they were opposed to Boeing, but because they said the same courtesy ought to be extended to every business in the state. Said state Rep. Matt Shea, R-Spokane, “We recognize the permitting process in this state is broken, but it is not just broken for one business; it is broken for all businesses. …If lower taxes and less government is good for one business in Washington, it should be good for all businesses in Washington state.”
Though two senators voted against the tax-break measure, the division was more pronounced in the House, where the permitting bill, HB 2088, passed 77-9. The tax-break bill, SB 5292, passed the House 75-11.
“If you had told me today, this morning, or last year that I would be standing before you with Democrats supporting a tax loophole and the Republicans opposing a tax exemption, I would be like – that doesn’t make sense to me,” said Rep. Richard DeBolt, R-Chehalis.
Liberals Also Oppose
House Finance Chairman Reuven Carlyle, D-Seattle, makes pitch for Boeing tax-break measure.
Also worthy of note was that the most conservative members voted alongside some of the most liberal. State Rep. Chris Reykdal, D-Olympia, said the tax break was a drop in the bucket for Boeing, which had $85 billion in gross sales last year, but it could make a big difference for education and social programs. Opposing the tax-break bill in the House were Democrats Reykdal and Sherry Appleton of Poulsbo, Mike Ormsby of Spokane, David Sawyer of Tacoma and Sharon Wylie of Vancouver. Republicans who voted no were Shea and Cary Condotta of East Wenatchee, Susan Fagan of Pullman, Jason Overstreet of Lynden, Elizabeth Scott of Monroe, and David Taylor of Moxee. In the Senate, naysayers were Bob Hasegawa and Adam Kline, both of Seattle.
Though lawmakers spent a full two-and-a-half hours debating the bills, the outcome never really was in doubt. The bulk of the body appeared to agree that Boeing’s importance to the economy trumped all the usual partisan positioning. Many argued that Boeing’s presence in the state of Washington drives an entire industry of small and medium-sized suppliers located throughout the state of Washington, some 1,350 companies located in 34 of the state’s 39 counties. “This is about our aerospace economy, this is about big companies and about small companies,” explained state Sen. Andy Hill, R-Redmond, chairman of the Senate Ways and Means Committee. “And I look at it as if a big aircraft manufacturer is a locomotive and it is pulling a bunch of different freight cars behind it.”
The debate demonstrates that there is a need to reform the state’s tax structure, said House Finance Chairman Reuven Carlyle, D-Seattle. It’s just that lawmakers can’t do it in an afternoon. “Every industry deserves that same level of passion and conviction as we try to move forward in building a responsible 21st century tax structure.”
Transportation an Issue for Later
House Republican Deputy Leader Joel Kretz, R-Wauconda, says few took seriously Inslee’s call for a transportation package.
Lawmakers adjourned at roughly 4 p.m. Saturday, and one issue was notable for its absence. When he called the special session Tuesday, Inslee declared that a critical piece of the Boeing deal was passage of a transportation package. Lawmakers quickly dismissed that idea. Boeing never said passage of a gas-tax hike was a make-or-break element of the deal, observed Deputy Minority Leader Joel Kretz, R-Wauconda – and the whole episode has caused some skepticism of the governor.
“The governor has been the only person in all of Olympia that I have heard say that,” he said. “It was a dead issue the day we got here. In fact, 10 minutes after he announced it, it was a dead issue.”
It remains possible that lawmakers will consider transportation in a special session Nov. 21, when they are scheduled to be in Olympia anyway for a series of committee meetings. Sen. Curtis King, R-Yakima, issued a statement Saturday that said lawmakers are continuing to negotiate on a transportation package and “are working to have something in hand soon.”
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