Washington state lawmakers voted down a bill on Friday that would have forced Boeing to keep a minimum number of jobs in the state in exchange for receiving billions of dollars in tax breaks. The 7-8 vote in the state's House Finance committee means the measure will not advance to a floor vote. "The timing is not right, right now," for restricting Boeing, said state Rep. Cary Condotta, a Republican who voted against the measure, citing the state's economic weakness.
The bill would have linked the tax breaks to Boeing's employment of at least 83,295 people in Washington, the number when the breaks were granted. The tax benefits would have been cut in half if Boeing employment fell by 4,000, and would have been eliminated if it fell by more than 5,000. Other aerospace companies would still have had access to the credits if the bill passed, regardless of Boeing's employment level. Boeing called the decision "a crucial victory," noting the tax breaks, worth nearly $9 billion, would spur the economy and generate an estimated $21 billion in state tax revenue over 16 years.
The plane maker's two largest unions said lawmakers had "bowed to Boeing" by failing to the pass a measure that sought to ensure Boeing would "maintain and grow" employment in the state, as the 2013 legislation granting the tax breaks specified. The vote "demonstrates the power of corporate influence to overcome what is clearly the will of the people and the intent of the legislation," Jon Holden, president of the International Association of Machinists District 751, which represents about 31,000 Boeing workers.
Lawmakers approved the original incentives in 2013 with support from labor, as part of a deal to ensure Boeing built its new 777X jetliner, and its carbon-fiber wings, in the state. Shortly after securing the tax credits, Boeing began moving jobs out of Washington. Boeing data show it employed 79,238 workers in Washington at the end of 2015, down from 83,295 when the credits were approved.