‘Snapback’ tax incentives for Boeing need accountability

Tell state legislators: Boeing should commit to Washington before our state commits millions more in tax incentives 

OLYMPIA (March 2, 2020) — At the Boeing Company’s request, the State Legislature is poised to end Washington’s aerospace manufacturer tax incentives in order to resolve a World Trade Organization dispute and avoid retaliatory trade tariffs from the European Union. However, the legislation to accomplish this — HB 2945 and SB 6690 — also includes a “snapback” provision that would allow the state, without the Legislature’s authorization, to automatically reinstate the tax preferences if the WTO dispute is resolved and allows the incentives to remain in place.

The unions representing tens of thousands of Boeing employees in this state support Boeing’s efforts to avoid harmful tariffs. But they also want any reinstatement of these tax incentives to include strong, specific accountability language ensuring that the tax breaks accomplish their goal of maintaining and creating good jobs in Washington state. The Society of Professional Engineering Employees in Aerospace (SPEEA) IFPTE 2001 and the International Association of Machinists (IAM) District 751 are urging state legislators to include strong accountability language in any snapback provision in HB 2945 and SB 6690.

TAKE A STAND — The Washington State Labor Council, AFL-CIO encourages all union members and other supporters of tax incentive accountability to support this important effort. Both IAM District 751 and SPEEA have set up online actions making it easy to contact your state legislators on this important issue. Send messages using either — or both!

Washington labor leaders recently testified in Olympia about Boeing’s decisions in recent years to expand manufacturing facilities and create jobs in South Carolina and in other countries while reducing its workforce in Washington. The Chicago-based company did this despite receiving these extraordinary tax breaks from our state — tax breaks that lacked any accountability measures as required in many other states. This is why HB 2945 and SB 6690 needs strong and specific accountability language alongside any snapback provision for the tax breaks.

“We believe that any snapback provision that does not include effective measures to maintain and grow aerospace jobs in Washington state is a continuation of a policy that has failed to provide its intended benefits to our aerospace workforce and our state’s taxpayers,” said Brandon Anderson, Legislative Director for SPEEA, which represents more than 18,000 Boeing engineers and scientists.

“The Legislature should not agree to snapback these tax incentives without knowing the aerospace environment at the time that this could occur,” said Jon Holden, President of IAM District 751, which represents more than 33,000 members, the majority of whom are Boeing employees. “What will the 787 production rate be? How will that production rate be split between Washington state and South Carolina? What will the rate of the 777X be? And where will they site their next airplane program? All these are important questions that you don’t have the answers to today.”

Holden said the legislation should have a “commitment to site the next airplane program here in Washington state.”

Boeing workers and their unions aren’t the only ones saying accountability is needed before the reinstatement of aerospace tax incentives.

“The Legislature should extract guarantees that the next new Boeing aircraft will be built in Washington,” wrote the editorial board for The (Tacoma) News Tribune.

“What’s adopted — if the tax incentives are permitted to resume at some point — ought to seek a better guarantee of jobs in trade for the significant tax breaks the state can provide,” wrote The (Everett) Herald.

TAKE A STAND — Add your voice using SPEEA’s and IAM District 751’s online actions and urge your legislators to add accountability language to HB 2945 and SB 6690.

The Seattle Times reports that House Majority Leader Pat Sullivan (D-Covington), the sponsor of HB 2945 believes the bill doesn’t have enough votes to pass in its current form, as lawmakers consider adding accountability measures to increase support. Ending the tax preference for Boeing and more than 300 other aerospace manufacturers in the state would raise an estimated $363 million in revenue through 2023.