May 22, 2009 in City
State officials reject airport’s bid for expansion loan
SEATAC, Wash. – In a decision that could jeopardize more than 200 planned jobs, state officials on Thursday rejected the Spokane airport’s request for a $6.8 million loan.
It’s too much to ask for, some members of the state Community Economic Revitalization Board said, when many rural communities are struggling more.
“I just can’t get there,” said board member George Raiter, voting no.
But by a single vote, the board also offered an alternative: $4 million. Proponents were disappointed, but said they’d see if there was a way to make it work.
“Hopefully there is. We want to be in Spokane,” said Bret Burnside, president of Cascade Aerospace USA, one of the two companies that wants to expand into a new $11.6 million building that would be partially paid for with the loan money.
Airport spokesman Todd Woodard said the expansion would create 266 new jobs.
“It’s an extraordinary number for Eastern Washington,” said Terry Lawhead, the regional manager for the state office of Community, Trade and Economic Development.
Unfortunately for proponents, $6.8 million was also an extraordinary number. Until now, CERB loans have been capped at $2 million.
“Leaping from 2 to 6.8 is a big step,” board member Marty Gardner said. The board voted to do away with that limit to consider the Spokane proposal.
For the past three years, state cash has helped add 142 local aircraft-based jobs. Some $750,000 in grants and nearly $3.3 million in loans has helped develop facilities used by four companies. Among them: a new 18,000-square-foot maintenance hangar.
Since setting up maintenance operations in February, Cascade has grown from 40 Spokane-area jobs to 60. Workers commute from as far away as Idaho and Moses Lake. Burnside said Thursday that a pending deal could mean 60 more jobs by the end of the year.
To supplement the $6.8 million no-interest loan, the airport would kick in $1 million, with Cascade and an aircraft-painting company, Associated Painters, each adding nearly $2 million.
In Cascade’s case, Burnside said, having the additional hangar space would mean the company could add more than 200 new workers, plus work for local suppliers. Associated Painters President Rod Friese said the Spokane operation would mean 36 jobs or more. The new facility is essential, he said.
“Without it, we will be forced to look elsewhere,” he said.
Spokane Community College would piggyback on the expansion, moving its aircraft-technician program from Felts Field. SCC President Joe Dunlap said the program has grown from 43 students to 90 in just two years.
Spokane International Airport’s proposal has already been pared back once. The original plan was to ask for a total of $8.7 million to build two buildings.
CERB projects are mostly rural, but in the last months of each two-year budget cycle, unspent money can be used for urban projects. The airport, as part of Spokane County, is considered urban.
The two-year budget cycle ends June 30. After that, any money left over would fall under the next budget’s rules, meaning that only $1.5 million can be spent in urban areas.
So airport and company officials must decide quickly whether they can make the project work with $4 million.
Some CERB members objected to spending so much money in one spot. State Sen. Dan Swecker, R-Rochester, suggested that the proposal was an urban money grab. CERB loans are for hard-to-grow rural areas, he said. Urban areas can find other money, he said. “Urban always wins,” he said.
Raiter, a county official from Kelso, also said the project would wrongly gobble up money that could be spread around. “I can’t do that to other parts of the state,” he said.
And the Spokane airport has “gotten three CERB loans since 2005,” added board member Julie Tappero, of Gig Harbor. “It’s not like they’ve never gotten anything.”
Sen. Brian Hatfield, D-Raymond, argued that the 266 jobs were a rare “bird in the hand” that shouldn’t be turned down in favor of awarding $50,000 here and there.
“What did we really get for that in the long term?” he said. “Right now we need jobs for the recession.”