Executive of family-owned aerospace business explains how tax policy keeps the industry viable in Washington

Sometimes overlooked in discussions of tax policy and the economy are the effects on small- and mid-sized businesses. When Washington legislators adopted and extended tax policies designed to secure production of the Boeing 787 and, later, wing production and assembly of the 777X, the policies also nurtured the state’s aerospace cluster as a whole. (For a good review of how these policies came to be, see this Washington Research Council report.) Boeing was the headliner; but the show doesn’t go on without a large cast of critical players.

In the Puget Sound Business Journal, Rosemary Brester, president and CEO of Hobart Machined Products Inc., explains how these policies affected her firm.

The aerospace industry in Washington state is a tremendous success story. And it’s not just Boeing. Hundreds of companies have contributed.

My family business, located in rural King County, has provided parts for commercial and military airplanes for 40 years. Through hard work and bootstrapping, we survived the Sept. 11 terrorist attacks and the recent recession and continue to provide jobs and support our community…

My company and others have made Washington a global aerospace leader through our commitment to being the best with the dedication of our employees.

But I’m anxious about the future of aerospace in Washington. 

She cites global economic pressures, changes in international trade, and the ever-present competitiveness challenges of the industry. Then she discusses the bills under consideration in the Legislature that would retroactively rewrite aerospace tax policy. We wrote about the recent public hearing here.

Tax incentives for the aerospace sector, which I helped draft, were first enacted by the Legislature over a decade ago to help grow this manufacturing industry. They enable us to compete with other firms across the world, and are critical to our success…

Nearly 350 companies in Washington state rely on the incentives.

The state’s own analysis shows the incentives will likely generate more than $21.3 billion in state and local tax revenue over 16 years — $3 for every $1 invested. This money pays for vital public services including education, social services and infrastructure.

…Proponents will say the bills target Boeing and not small companies like mine. But we’re all interconnected.


She concludes by noting that the policies are working as lawmakers intended. 

Attaching arbitrary employment requirements to companies that boost Washington’s economy will undermine my company and the industry and compound the state’s budget problems.

No one can predict with confidence how lawmakers will resolve the budget impasse that has taken the Legislature into special session. No vote has been scheduled for the bills Brester is addressing. Her op-ed is timely and persuasive, informed by a career in the industry. 

Again, we conclude: Washington has enjoyed a robust, positive return on its investment in sound tax policy. Rewriting the rules after the fact would jeopardize that return and call into question the state’s credibility and reliability for any business considering expansion or relocation here. It would be an expression of bad faith and an enormous public policy risk.