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Keeping Washington's Competitive Edge


Washington's currently overwhelmed transportation system threatens jobs and ... To ensure Washington State's prosperity in the future, given the interdependence ... – PowerPoint PPT presentation

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Title: Keeping Washington's Competitive Edge

Keeping Washington's Competitive Edge
Washington Competitiveness Council
Competitiveness Council Members
Executive Director
Kerry Killinger Chairman, President and
CEOWashington Mutual, Inc., Seattle Bud Mercer,
President Mercer Ranches Inc., Prosser Alan
MulallyPresident and CEOBoeing Commercial
Airplanes, Renton Norman B. Rice President and
CEOFederal Home Loan Bank of Seattle, Seattle
Judith RunstadFoster Pepper Shefelman PLLC,
Dick Thompson, Director of Government
RelationsUniversity of Washington, Seattle
Competitiveness Council Members
Other members
John T. Powers, Jr., MayorCity of Spokane
Andrea Riniker, Executive DirectorPort of
Tacoma Paul Schell, Mayor City of Seattle The
Honorable Barry Sehlin (R-10), Washington State
House of Representatives Ron Sims, King County
Executive The Honorable Sid Snyder
(D-19)Washington State Senate Lucy Steers,
Civic Activist and Public Involvement
ConsultantSeattle Tom Stokes, CEOTree Top,
Inc., Selah Steve Tso, PresidentWaferTech,
Camas The Honorable James West (R-6)Washington
State Senate
Bob Drewel, Snohomish County Executive Ed
Fritzky, Chairman, President. And CEO,
Immunex Joseph K. Gavinski, City ManagerCity of
Moses Lake Sally Jewell, Chief Operating
 Officer, REI, Inc., Sumner John F. Kelly,
Chairman and CEOAlaska Airlines, Inc., Seattle
Terry Knapton, Chief Operating Officer, Colville
Tribal Enterprise Corporation, Coulee Dam
Richard L. McCormick, PresidentUniversity of
Washington, Seattle Scott Morris,
PresidentAvista Utilities, Spokane Bill Neukom,
Executive Vice PresidentLaw and Corporate
AffairsMicrosoft Corporation, Redmond H.
Stewart Parker, President and CEO, Targeted
Genetics, Seattle
Tom Alberg, Managing DirectorMadrona Venture
Group, LLC, Seattle Stan Barer, Co-Chairman and
CEOSaltchuk Resources, Inc., Seattle John
Begley, President CEOPort Townsend Paper, Port
Townsend Rick Bender, PresidentWashington State
Labor Council, AFLCIO, Seattle Roger Boatwright,
Executive SecretaryWashington State Building and
Construction Trades Council, Olympia Jeff
Brotman, ChairmanCostco Wholesale, Issaquah
Phyllis J. Campbell, ChairCommunity BoardU.S.
Bank of Washington, Seattle The Honorable Frank
Chopp (D-43), Democratic Speaker of the House
Washington State House of Representatives M.R.
(Mic) Dinsmore, CEO Port of Seattle
  • Discuss key business climate issues.
  • Improve public understanding of the importance of
    a healthy business climate to the future of
    Washington's economy.
  • Engage the business community in advancing a
    competitiveness agenda.
  • Identify and implement public policies that
    strengthen state and local governments' ability
    to respond to business community needs.

Issue Areas
  • Taxes and Fees
  • Regulatory and Permitting Issues
  • Physical Infrastructure
  • Human Capital and Innovation
  • Benchmarking

  • Proposed changes in statute--require legislation
  • Proposed changes in the Washington Administrative
    Code (WAC)--require a formal rulemaking process
  • Proposed administrative actions
  • Statements of position by the Council
  • Benchmarks/performance measures

  • August 30
  • September 18
  • October 16
  • November 13
  • December 11

Most Imperative Recommendation Fix our
Transportation Problem
  • The most important competitive investment the
    state of Washington can make is to improve its
    transportation infrastructure.
  • Washington's currently overwhelmed transportation
    system threatens jobs and economic vitality,
    wastes people's time and money, diminishes
    quality of life, and degrades our environment.
  • To ensure Washington State's prosperity in the
    future, given the interdependence of the
    economies both east and west of the Cascades, we
    must improve our ability to move people and

Taxes and Fees
  • Council Findings
  • Taxes and fees significantly affect Washington
    business's ability to compete.
  • Washington State must balance two competitiveness
    issues - the need to provide essential state
    services and the need to minimize the relative
    tax burden on business.
  • Currently, Washingtons initial tax burden on
    business is one of the highest in the nation.

Taxes and Fees
  • Council Recommendations
  • Avoid increasing taxes on business. Maintain
    existing exemptions and incentives.
  • Transportation improvements will require new
    revenue. Generate them through user fees,
    regional taxes and alternative financing
  • Clarify and simplify tax provisions, especially
    the following
  • Manufacturing machinery and equipment sales and
    use tax exemptions,
  • Municipal taxation, and
  • Deduction of investment income from the business
    and occupation (BO) tax.

Taxes and Fees
  • Council Recommendations (continued)
  • Reform unemployment insurance (UI) to make it
    more fair, predictable, and stable.
  • Develop and use tax incentives to keep and grow
    businesses in Washington.
  • Adopt key performance measures to better judge
    Washington's overall competitiveness, and the
    effect of its tax system on business climate.

Regulations and Permitting
  • Council Findings
  • Washington's environmental regulations are
    important to the environment and the health of
  • Rather than weakening Washington's environmental
    safeguards, the Council seeks a culture change
    within the regulatory agencies to help businesses
    get things done.
  • Washington's current environmental regulatory
    system is uncoordinated and inefficient, and
    contributes to regulatory problems that damage
    Washington's competitiveness.
  • The current regulatory structure unnecessarily
    delays projects, increases project cost, creates
    unnecessary uncertainty, reduces operating
    flexibility, and increases barriers to business

Regulations and Permitting
  • Council Findings (continued)
  • Washington's inadequate water systems impose
    uncertainty on businesses and growing
  • A lack of affordable housing impedes a company's
    ability to attract a quality workforce.
    Regulatory requirements that are overly
    burdensome can exacerbate the housing shortage.

Regulations and Permitting
  • Council Recommendations
  • Create leadership to streamline and build
    accountability in the environmental regulatory
  • Create a greater service ethic, improve attitude
    within regulatory agencies, and improve the
    agencies accountability.
  • Consolidate and/or coordinate permitting
    processes between agencies and levels of
  • Create a single state-government contact for
    businesses considering locating or expanding in
    the state.
  • Tighten the Washington Administrative Procedures
    Act (APA) to reduce agency discretion in the
    rulemaking process.

Regulations and Permitting
  • Council Recommendations (continued)
  • Increase funding to make the Growth Management
    Act work in a timely and effective manner.
  • Streamline the adjudicative processes related to
    land use.
  • Delay implementation of the proposed ergonomics
    rule until questions about its cost and
    effectiveness are answered.
  • Ease regulatory pressures to make it easier to
    build affordable housing in Washington.

Physical Infrastructure
  • Council Findings
  • Transportation, utilities, and telecommunications
    systems must ensure the fluid movement of people,
    products, and information.
  • The most important competitive investment the
    state of Washington can make is to improve its
    transportation infrastructure. Washington
    citizens currently lose 2 billion per year
    because traffic congestion wastes time and fuel
    and causes shipping delays.
  • Washingtons water laws and infrastructure do not
    adequately provide the capacity to meet 21st
    century demands and responsibilities.

Physical Infrastructure
  • Council Findings (continued)
  • Washington must reduce unnecessary delays in the
    siting of telecommunications and energy
  • Low-cost and reliable electricity is critical to
    Washington's economy. The financial viability
    and access to capital for Washingtons utilities
    are essential to meeting Washington's energy
  • The Pacific Northwest needs additional electrical
    transmission lines to meet expected growth in
    energy demand.

Physical Infrastructure
  • Council Recommendations
  • Secure long-term, stable, reliable funding for
  • Establish performance measures to show that
    transportation investments are effectively
    addressing needs.
  • Use regional funding authority and alternative
    financing mechanisms.
  • Build additional water storage capacity.
  • Reduce unnecessary delays in siting
    telecommunications and energy.
  • Promote a regulatory and political environment
    that supports the financial health of the state's
    utilities and ensures the BPAs ability to invest
    in new transmission capacity in the Pacific

Human Capital and Innovation
  • Council Findings
  • Human capital and innovation are fundamental to
    gaining a competitive advantage in the modern
  • Without action, Washington will fall behind other
    states and regions that are investing massively
    in these areas.

Human Capital and Innovation
  • Council Recommendations
  • Increase support of research, development, and
    technology commercialization in strategically
    important industrial clusters.
  • Give research universities the tools and
    flexibility they need to continue to attract top
    talent and federal funding.
  • Expand capacity at colleges and universities,
    particularly in strategically important fields of
    science and engineering.
  • Accelerate training of workers for high-demand
    fields, including new workers, existing workers
    and displaced workers seeking to reenter the

Human Capital and Innovation
  • Council Recommendations
  • Improve still-lagging academic standards.
  • Address the challenge posed by a growing number
    of students who speak English as a second
  • Reverse a severe shortage of science and math
    teachers at all levels.

Benchmarks and Performance Measures
  • Council Findings
  • Many studies of Washington business climate are
    available but they are difficult to sort through.
  • The Washington State Office of the Forecast
    Council publishes an annual Economic Climate
    Study, but the benchmarks have not been updated.
  • Although benchmarks are available, they are not
    always used in policy analysis.

Benchmarks and Performance Measures
  • Council Recommendations
  • Reconvene the Economic Climate Study Advisory
    Board to update the benchmarks published in the
    Economic Climate Study.
  • Use benchmarks in policy analysis and performance
    reviews for state agencies.

Governor Lockes Response
  • Governor Lockes Priorities
  • Creating new jobs
  • Solving transportation problems
  • Providing economic development infrastructure to
    rural communities
  • Streamlining the permitting system
  • Making water available to growing communities
  • Improving Washingtons tax environment

Governor Lockes Response
  • Governor Lockes Priorities (continued)
  • Providing universities flexibility to improve
    their responsiveness to industry workforce needs
  • Ensuring that Washington workers have the skills
    to fill available jobs
  • Reinforcing our commitment to education
  • Tracking our progress in improving competitiveness

Governor Lockes Proposal
  • Infrastructure
  • Create more than 20,000 new jobs, many in the
    next few years, by building roads and other state
    public works facilities.
  • Implement a long-term, comprehensive solution for
    Washingtons transportation problem.
  • Secure long-term predictable funding for the
    Community Economic Revitalization Board (CERB) as
    a vehicle for transportation and other
    infrastructure investments tied to economic

Governor Lockes Proposal
  • Regulations and Permitting
  • Establish focused leadership to bring major
    reform and accountability to Washingtons
    regulatory system.
  • Reduce the time and expense of securing
    regulatory permits by creating a coordinated
    system that simplifies and speeds up permitting.
  • Provide greater certainty to business by
    establishing clear standards and timelines.
  • Expand the Master Business Licensing program to
    save businesses time.

Governor Lockes Proposal
  • Regulations and Permitting (continued)
  • Benchmark permitting timelines in regulatory
    agencies to monitor progress and provide
    accountability to the public.
  • Work with the Legislature to take the next step
    in reforming Washingtons water law by setting
    and achieving proper in-stream flows and
    providing safe and reliable water supplies.
    Pursue funding for water storage.

Governor Lockes Proposal
  • Taxes and Fees
  • Clarify tax provisions related to investment
  • Simplify municipal taxation and eliminate the
    possibility of double taxation by local
  • Avoid general tax increases.

Governor Lockes Proposal
  • Human Capital and Innovation
  • Provide tuition flexibility for universities so
    that they may offer competitive faculty salaries
    in strategically important fields while
    maintaining access to education for deserving
  • Tie university and college enrollment increases
    to high-demand fields, with preference to
    programs with model articulation agreements.
  • Expand worker retraining by adding 1,500 new
    slots for students of community and technical
    colleges, increasing the number from the current
    7,200 to 8,700.
  • Provide 750,000 in new funding to train workers
    for newly located or expanded businesses.

Governor Lockes Proposal
  • Benchmarking and Follow-up
  • Monitor Washington States progress toward
    improving its competitiveness by establishing new
    competitiveness benchmarks and using them in
    policy analysis and agency review processes.
  • Reconvene the Competitiveness Council annually to
    review progress on implementing their
    recommendations and discuss the states
    competitive status.
  • Continue reviewing recommendations and developing
    proposals in response to recommendations.

Next Steps
  • Follow-up meeting being planned for February
  • Present a workplan for implementation.
  • Discuss status of administrative reforms and
    proposed legislation.
  • Provide additional data for benchmarks.
  • Additional follow-up meetings annually or as

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