Published November 2001

Report lists traffic, housing as business concerns

By Bryan Corliss
Herald Economy Writer

SEATTLE — The Boeing Co. may be committed to building the Sonic Cruiser, but Puget Sound needs to make a commitment of its own to ensure that the new jet is built here, regional economic development officials said during an October meeting as they unveiled a report outlining business conditions in Snohomish, King, Pierce and Thurston counties.

Perhaps the most important finding in the report is that “there’s nothing dramatically new that we didn’t know,” said Reid Shockey, Snohomish County Economic Development Council Chairman. It chronicles concerns from businesses in the region that find it hard to compete given local problems with transportation, education and permitting processes for new construction.

Shockey and other business leaders vowed to lobby Olympia and local governments for policies to improve the business climate.

“Our ability to globally compete is obstructed by our current public policy environment,” said Frank Young, chairman of the Seattle-King County Economic Development Council. “Problems with our physical infrastructure, tax and regulatory policy, the education system and the energy supply must be addressed now — not five, 10 or 20 years from now.”

The report was prepared by the private Washington Research Council. Among the problems it found:

• Puget Sound business leaders see transportation snarls as a major problem and are frustrated that the Legislature has failed to come up with a plan. Road construction was the No. 1 thing business people say government could do to improve the business climate, the report said.
• Along with roads, the region has failed to build enough sewer and water systems to keep pace with growth. According to one unnamed business person quoted in the study, “We’re doing pretty good on cabling, DSL, technology stuff, but it’s the simple old stuff we’re failing at.”
• The high cost of housing is forcing local businesses to pay higher salaries, and it hurts efforts to recruit new employees. Many people who work in King County have moved to Snohomish and Pierce counties in search of affordable homes — a fact that contributes to traffic congestion, the study said.
• Washington residents have relatively high education levels, but there is a shortage of people with science and technology degrees. The state needs better coordination among its work-force training programs, the study said. The state also is facing a shortage of health-care workers.
• There’s a wide range of discontent with regulatory processes. In some cases, it’s not the regulations themselves but the inconsistent way they’re interpreted or enforced, the study said. Businesses that do get permits quickly say it’s because of relationships with regulators.
• Business people are unhappy with the tax system, under which they pay about half the load, the study said. Many are unhappy with the business and occupation tax, while others think the state’s unemployment insurance taxes are too high.

It’s time to take action, said Alan Mulally, Chief Executive of Boeing Commercial Airplanes, who spoke at the Oct. 19 meeting where the report was released.

“I don’t think we need to look at a lot more data,” Mulally said. “We have to decide if we want to do something about it.”

Mulally also said the Boeing Co. will reconsider moving its 737 and 757 assembly lines from Renton to Everett in light of the production slowdowns that followed the Sept. 11 terrorist attacks.

Boeing now expects to build between 350 and 400 commercial jets in 2002, down from this year’s expected total of 522.

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