Locke approves $3 billion package of Boeing perks - Governor praises 'great step forward' designed to lure 7E7


What Boeing gets
Tax breaks reach more than $120 million in the fiscal year beginning July 1, 2007, and total about $3 billion over 20 years, if Boeing agrees to assemble the next-generation 7E7 in Washington.

Everett commission OK's Boeing pier

The Everett Planning Commission has unanimously approved a change to a shoreline master plan, allowing construction of facilities like a pier that state and local officials say is needed to persuade Boeing to build its proposed 7E7 Dreamliner here.

The proposals now go before the Everett City Council. Even if the City Council supports the commission's recommendation, the Port of Everett would need to get several state and federal environmental permits, along with city construction permits.



State officials are putting the final touches on their bid to land The Boeing Co.'s next-generation 7E7 jetliner plant.

Gov. Gary Locke signed a $3 billion package of tax incentives Wednesday that would aid the aerospace giant.

"This is a great step forward in making our state more competitive in winning the 7E7 'Dreamliner' for the state of Washington," Locke said in a bill-signing ceremony attended by legislators, members of Boeing's Machinists union and others who helped push the measure through the Legislature on short notice.

The incentives put the state on good footing to win the assembly plant, which could generate 17,300 direct and indirect jobs statewide, Locke said. Losing the plant could cost the region 150,000 jobs over the long haul, Locke has said.

The state's package of inducements to Boeing -- which includes $15.5 million for a rail-barge facility at Everett if Boeing chooses to build its plant there -- will be hand-delivered to Boeing's headquarters, as well as to the company's South Carolina consultant, on Friday.

"There's a person delivering it in person to make sure there is no hitch," Locke said, adding that it's "pretty much done."

Up to 20 or 25 states are in the running, but five are among the strongest, said Martha Choe, state director of trade and economic development, who played a key role in crafting Washington's response to Boeing's request for proposals.

California is thought to be among those that, like Washington, meet Boeing's requirement for a deep-water port.

Locke said Washington makes the case that it is a cheaper place for Boeing in the long run as it competes with European giant Airbus.

But unlike other states in the running, Locke said, Washington cannot build a plant for Boeing or donate property under the state constitution's prohibition on government gifts to private interests. On the other hand, Washington's package includes favorable tax treatment for aerospace-related businesses and for research and development efforts.

Neither Choe nor Locke foresaw the need to call legislators back to offer more inducements, though they acknowledged they do not know what other states might offer.

Choe said the state is putting its "best foot forward."

The tax incentives to aerospace companies range from $28 million in the 2003-05 budget cycle -- if the plant is built in Everett -- to $108.5 million in 2005-07 if it's built in Moses Lake. Beyond that, the value is $3 billion over 20 years.

Rep. Eric Pettigrew, the Seattle Democrat who sponsored House Bill 2294, said Boeing has been a model corporate citizen, providing manufacturing jobs that are vanishing from the region. And Sen. Dino Rossi, R-Sammamish, warned that a Boeing departure could cost the state $540 million a year in tax revenue.

The state Republican Party, which is gearing up its 2004 campaign against Locke, issued a statement Wednesday saying that Locke's efforts on behalf of Boeing should be credited to Republicans in the Legislature.

By contrast, Linda Lanham of the International Association of Machinists Local 751, praised Locke, saying his actions on the Boeing-related issues, including reform of the unemployment insurance system, "define a true leader."

Sen. Luke Esser, R-Bellevue and a member of a political team that worked for the Boeing tax cuts, said Locke "has done a good job on the entire Boeing 7E7 process. I have to give him credit for that. I think he's been generous in sharing the credit."

Brad Shannon can be reached at 360-753-1688 or beshanno@olympia.gannett.com.

On the Web

Gov. Gary Locke: www.governor.wa.gov

Boeing: www.boeing.com



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