Breaking: Governor vetoes bipartisan deal to create manufacturing jobs

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BREAKING:

Governor Inslee Vetoes Policy to Grow Manufacturing Jobs

Moments ago, Governor Inslee vetoed part of a bipartisan piece of legislation that would have stimulated manufacturing job growth in Washington.

Since 2000, Washington has seen strong employment growth in almost every major sector, oftentimes outpacing national employment as well.

The only area that has seen any decline has been manufacturing, which has lost more than 50,000 jobs since the turn of the century.

As part of our new state budget, Senate Republicans and some Democrats sought to improve the economic conditions for manufacturing businesses throughout the entire state who provide good-paying jobs, especially for people without advanced degrees or training.

Manufacturing jobs in Washington currently pay an average of $84,000 per year, much higher than the state's overall average of roughly $56,000 per year.

Washington's current B&O tax rate for manufacturing businesses is not the same for everyone, so we worked to phase in one uniform rate for all manufacturers equal with the tax rate provided to Boeing and other aerospace companies a few years ago.

We chose to pay for this tax reduction by closing other preferential tax rates that are not as economically productive as a uniform rate for manufacturing with funding left over to help with fully funding Washington's schools. This policy would have also forever closed what is known as the "Boeing Tax Loophole" by recognizing that we should support and attract manufacturing jobs in all sectors.

This new B&O tax change received strong bipartisan support in the Legislature as an attempt to stimulate job growth statewide, helping suburban and rural communities experience some of the same success going on in the Seattle area.

The governor vetoed this change at a time when governors in other states and other state leaders here in Washington are actively trying to attract new manufacturing jobs.

Manufacturing by the numbers

51,600 manufacturing jobs lost in Washington since 2000, the only major sector seeing losses since that time.

21% Washington's employment growth since 2000, well beyond the 12% seen nationally.

47,700 non-aerospace jobs lost.

0.484% current business and occupation tax rate for manufacturers

0.2904% current business and occupation tax rate for Boeing and other aerospace companies, and the new rate for all manufacturing companies passed by the Legislature.

4.5 to 1 ratio of votes in support to votes against on this legislation in the Senate and House.

There are certainly parts of the final state budget that people on both sides of the aisle do not like but are necessary to find agreement and reach a compromise.

The process of waiting to the last minute to craft a compromise and the inexcusable lack of transparency in the final days of the session is something both Republicans and Democrats should agree flatly stinks. But we should also find common ground in promoting family-wage jobs and strengthening our economy for more than just high-earners in the Central Puget Sound area.

Passed with strong support in both parties and in both chambers, this policy could have had a strong impact on job growth in those industries that have never fully recovered from the recession, and in those sectors where middle-class families have found economic security. While I believe we have accomplished some good outcomes this session in partnership with the Governor's office, I am deeply disappointed by Governor Inslee's decision on this matter.

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