Regulatory Costs Helped Kill Tumwater's Miller Brewery
By Don C. Brunell
Association of Washington Business
Olympia, WA - A century of tradition and history has ended with the
Miller Brewing Company will close its Tumwater brewery in July. Four
hundred people will lose their jobs.
The brewery has been in operation at that site since 1896. Built by
Schmidt family, it was sold to Pabst in 1983 and sold again to Miller
So, what caused the demise of a century-old business? No single factor,
The facility was old and inefficient, production costs were high,
and it was
the smallest of Miller's seven breweries.
But, one of the major factors was regulatory costs - specifically,
The brewery, which produced about 1.7 million barrels of beer per
its production water through LOTT, the regional water treatment facility
serving Lacey, Olympia, Tumwater and Thurston County. Over the years,
treatment costs had escalated to the highest of any Miller operation
"We have a major brewery in Los Angeles, California, with some
highest environmental standards in the nation," noted one Miller
"and the costs there aren't as high as they are in Washington.
at facilities in San Francisco, which is well-known for its regulatory
restrictions, and even there water treatment costs are less than they
Because of rising water treatment costs and a lack of treatment capacity
LOTT, Miller ultimately decided it would be cheaper and easier to
own treatment plant.
The only problem was, Miller couldn't find anyplace to dispose of
treated water. Now, keep in mind, the treated water from the brewery
Class A - virtually drinking water quality. Nonetheless, the state
Department of Ecology (DOE) wouldn't let the brewery discharge its
water into the nearby Deschutes River. According to one company official,
DOE staffer said, "The water might be good enough for people
to drink, but
that doesn't mean it's good for the fish."
Miller investigated a myriad of options for disposing of its treated
including providing it to the Department of Fisheries to expand its
right across the street. But the Department of Ecology nixed that
well, saying it didn't want more fish waste in the river.
So, while it wasn't any one thing that doomed the brewery, regulatory
and restrictions finally tipped the balance. It simply wasn't worth
anymore to do business in Washington state.
Hundreds, if not thousands, of other businesses in Washington are
approaching their own "tipping point." Employers, who are
struggling with a sluggish economy, fierce foreign competition, and
health insurance costs, are facing big increases in state fees and
such as the proposed 29 percent increase in workers' compensation
Washington's business community constantly warns about the affect
regulatory costs have on employers' ability to provide jobs, but many
don't see the connection.
For the 400 people who will lose their jobs at the Miller Brewery,
connection has become crystal clear.