Creating a better job climate

MOSES LAKE — Is Washington a friendly place to do business? Well, Forbes magazine listed our state as the fifth best state to do business in the country. And the Small Business and Entrepreneurship Council ranked Washington the fourth best state in tax systems for small businesses. So we must be a great attraction for employers, and our businesses must be satisfied here, right?

Then why would Boeing choose to build a second line of 787s in South Carolina? How did Washington – and possibly Moses Lake – lose out on 3,800 potential new jobs with a second line of 787s? How did we lose out on the two to three additional jobs throughout the state that are created for every job at the aerospace company?

First, the workforce is not stable. In 2008, an eight-week strike added to the delayed delivery of their newest plane, costing the company $100 million each day. Plus, despite the long-standing training programs at Big Bend Community College and other colleges and trade schools, not enough young talent is staying here in Washington to replace our aging aerospace workforce.

Second, other states are trying harder to compete for our business. We no longer are playing on offense for our own teams; we are being forced to play defense. Moses Lake has tried for several years to bring the new Boeing line and other expansions to our area, but if things don’t change in Olympia, their work could be in vain. The South Carolina Legislature passed a package of tax incentives to lure Boeing during a special session. In addition, their labor is less expensive because the cost of living for their citizens is lower.

Third, the high sales taxes in our state simply can’t compete with other states. This summer in Grant County, Microsoft announced it would move future applications and storage from its data center in Quincy to another region. The reason: ‘a change in local tax laws.’

Originally it was thought the server “farms” would qualify for a rural manufacturing sales tax exemption under Washington state law. Since the law was clarified, Microsoft and Yahoo!, companies that both had opportunities for growth in Grant County, have put off future projects. According to the Puget Sound Business Journal, Yahoo is currently looking at properties in Oregon, where Google has its own data center.

Finally, Washington is simply not a friendly place to do business. Our overly restrictive regulations, a time-consuming permitting process and taxing structure just cannot compete with other states.

This past session, my Republican colleagues and I fought to fix a tax error with unemployment insurance to ease the burden on struggling employers. We were successful. But then just this summer, the state Department of Labor and Industries announced its plans to raise workers’ compensation premiums by 7.6 percent in 2010, even though claims have declined 55 percent. Employers and employees cannot take another hit right now.

The agency claims the fund is running low, but I learned that administrative costs are up 28 percent over the last year. The culture in Olympia is just not geared toward bringing new employers and jobs into our state. Instead, the bureaucracy is tangled in a web of self-promotion and government-focused answers.

I hear all the time from small business owners about the regulations that state agencies have put on employers that make it more difficult for them to stay afloat. Case in point is the $74 million in real estate property listings that were negatively affected by the Department of Ecology’s exempt well moratorium in Kittitas County. This put real estate agents, construction workers, and many more jobs at risk.

If Washington is not a good place for a large company like Boeing which is entrenched in the Northwest’s history, to stay here, how on earth can our mom and pop operations have hope of surviving?

For the upcoming legislative session, I will be working on and supporting several efforts to be proactive about bringing more jobs to our state. This doesn’t mean bailouts for businesses, but incentives for employers to bring their businesses and jobs to Washington. I hope you will contact me with your suggestions, and follow the legislative process. You can sign up for my electronic newsletter on my Web site. I periodically send updates throughout session and even during the interim.

Judy Warnick is a state representative, serving citizens on Kittitas, Grant and northeast Yakima counties. She can be contacted by e-mail at Warnick.Judith@leg.wa.gov or by phone at 509-766-6505.