Washington Business Spring 2018 | Washington Business | Page 14

eye on business
Manufacturing is the Great Economic Equalizer
Kris Johnson, AWB President
We learned a lot touring the state in a pair of buses last year.
We learned how diverse the state’s manufacturing sector
is. We met hundreds of employees, hearing pieces of their
stories and how they contribute to their communities.
And we were reminded about how a healthy manufacturing
sector brings economic opportunity and stability to the state
of Washington and improves the health of the entire business
ecosystem.
Throughout the tour, which is the focus of this magazine’s
cover story, we saw firsthand how entire communities are lifted
up by a robust and diversified manufacturing sector.
Take Lamb Weston, one of nearly 70 tour stops across
the state, as an example. Built in 1972, the Richland plant
was expanded last year to add another 150 jobs, bringing
employment to 600 and doubling production to 600 million
pounds of frozen french fries each year.
Those employees buy homes, pay local school levies and
support the local economy through their purchasing power.
And, Lamb Weston’s suppliers — repair technicians, freight
drivers and others — benefit from the new jobs and the larger
presence of the company.
That expansion was made possible by the strong commitment
of the company to the region, but also because of modest
food processor tax relief approved by the Legislature a few
years back. That tax relief was reinvested right back into the
community to create family-wage jobs that support every other
sector — retail, professional services, educational institutions
and government employment.
14 association of washington business
While just one example, it illustrates how, if given a chance,
manufacturing can be the great economic equalizer for families
in every one of our state’s 39 counties, many of whom are still
waiting for the economic recovery of the central Puget Sound
region to reach their communities.
Realizing that, the Legislature gave manufacturers a boost
last year by passing a bipartisan provision as part of the budget
negotiations to give all manufacturers business and occupation
(B&O) tax relief — making the sector’s tax rate uniform.
The goal was to rebuild the sector’s job base, which has lost
more than 50,000 jobs since 2000, and infuse investments in
expansion and job creation by the more than 12,000 small-
and medium-sized manufacturers that would benefit from the
tax relief.
Unfortunately, it was vetoed by the governor before it could
take effect.
During the 60-day 2018 session, AWB continued to advocate
for the tax relief to be reinstated through columns in and
editorial board meetings at newspapers across the state, in
meetings with legislators of both parties and the governor, and
directly through the voices of manufacturers in videos and at
legislative committee hearings.
Our message was heard, mostly. A bipartisan bill to reinstate
the tax relief was introduced in the House and received a public
hearing. But, it would have only benefited manufacturers in 30
of the state’s 39 counties.
I testified at the bill hearing alongside Dave Gering, executive
director of the Manufacturing Industrial Council, and Harry
Ross, human resources director at Seattle-based Cascade
Designs. Our message was clear: The B&O tax reduction should
apply to all Washington manufacturers.
Lori Mattson, president and CEO of the Tri-City Regional
Chamber of Commerce, echoed that in a Tri-City Herald
guest column about the exclusion of Benton County from the
manufacturing tax relief proposal. “Here in the Tri-Cities,
we know we’re one region, so it makes sense to include all
manufacturers, no matter their location,” Mattson wrote.
It’s a sentiment we’re sure is shared in every region of
Washington state.
Our hope is that when the Legislature reconvenes in 2019,
lawmakers revisit the issue with the understanding that
investing in a strong manufacturing sector pays large dividends.
For our part, AWB will be back before lawmakers with the
same message: “It’s time to let all manufacturers win.”