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Sun., Oct. 6, 2013

Editorial: Aerospace competition forcing state to step up

Don’t know what the aerospace equivalent is to a treadmill, but whatever it is, Washington is treading.

With Boeing Co. widely expected to announce the launch of a 777X airliner next month at the Dubai Air Show, Gov. Jay Inslee, a panel of legislators, and labor representatives have had the first of several meetings to prepare plans that will keep that program in Washington. Inslee has already made a preliminary bid: the extension of tax breaks passed in 2003 to ensure 787 production in the state. Now due to expire in 2024, the breaks would instead remain in place until 2040.

The governor says the tax breaks amount to $1.4 billion since their enactment, but the payoff has been double that: $3 billion in revenue. And Boeing and its suppliers provide some of the best-paying jobs in Washington; certainly in the manufacturing sector.

The company directly employs 84,300, and the rest of the industry, which also benefited from the tax package, almost 50,000 more.

But every time the company contemplates development or redevelopment of an airplane, the work begins anew to capture that program and associated jobs. A Boeing decision to put a 787 production line in South Carolina served notice that its Puget Sound-area plants were no longer the only option.

South Carolina laid out $450 million to get that Charleston-area plant, which was permitted and constructed in less than three years. Boeing has since purchased hundreds of acres of adjacent property.

Boeing unions certainly got the message. In 2011, the Machinists agreed to a contract that restored peace after strikes in 2005 and 2008. That helped secure production of the 737MAX at the Renton factory, where the existing models of the plane are made.

But tax breaks and labor peace may not be enough. Boeing is reportedly concerned that potential new water quality regulations based on fish consumption estimates may be a problem for some of its facilities. A company push for further study of the issue was one of the last matters resolved before the Legislature went home in June.

The company did not get what it wanted.

Although Everett would remain the focal point for 777 production if the decision is made to go forward with the new model there, Spokane might still be among the beneficiaries. One supplier, Aviation Technical Services, is considering construction of a hangar at Spokane International Airport, and others confined to the Seattle-Everett area could also come looking for more space, and less transportation congestion.

The Air Washington Program of the Spokane Community Colleges and others is training workers to fill potential new jobs.

The Boeing plant in South Carolina, and the start of an Airbus factory in Alabama, underscore how much more competitive the aerospace business has become in the United States and how much harder Washington must run to retain its place of pre-eminence.

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