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March 01, 2014

Pierce County leaders hear about urgent business needs

The News Tribune

John Gillie

Even as Pierce County's top economic development group ticked off the business achievements of the last year at its annual meeting Friday, both Gov. Jay Inslee and Port of Tacoma Chief Executive John Wolfe warned of difficulties ahead.

Inslee told attendees at the Economic Development Board for Tacoma-Pierce County's 2014 annual meeting that without a new comprehensive transportation funding package, Washington's highways, bridges, ferries and bus systems could suffer decline. And Wolfe said that Puget Sound is losing shipping market share to Canada and Southern California ports.

The governor said maintenance of state highways could drop by 52 percent, deficient bridges could multiply, and bus and ferry service would have to be cut unless the state Senate approves a transportation deal by the end of the legislative session.

"Our state is better than this," said the governor. "We deserve a transportation system adequate to the needs of its people."

The need is particularly critical in Washington because the state is one of the most dependent on foreign trade. The road and rail infrastructure must be adequate to transport goods and agricultural products from farms and orchards to the state's ports and move imported goods to inland markets.

Inslee said part of that needed infrastructure improvement was completion of state Route 167, from Puyallup where its freeway portion ends to the Port of Tacoma.

Wolfe, who appeared on a panel with Diane Cecchettini, president and chief executive of MultiCare Health System, and Bill Frame, senior vice president of Kidder Mathews, said that although the Port of Tacoma last year saw its container traffic once again approach 2 million container units, a 10 percent gain, Puget Sound's overall share of the container trade fell by 2 percent.

Tacoma's gain was the Port of Seattle's loss, he said. The Port of Tacoma nearly two years ago attracted a shipping line consortium, the Grand Alliance, from Seattle to the Port of Tacoma.

Competition from Canada, which enjoys a tax advantage over American ports, and from Southern California, which has a huge local population, have eroded Puget Sound's market share.

The ports of Seattle and Tacoma, he noted, recently signed an agreement that will allow them to share more information and to coordinate their marketing activities while maintaining their political independence.

Wolfe also noted that the federal Harbor Maintenance Tax proceeds are being used to improve East Coast ports in anticipation of more shipping through a widened Panama Canal. The Pacific Northwest ports want that tax reformed to levy it on goods imported to the U.S. through Canada.

Wolfe said the state's maritime shipping industry, the third-largest in the country, is in crisis. He called on Pacfic Northwest businesses to rally to help improve the trade.

"The job is ours to respond," he said. "I don't want to look back in 10 years and ask what happened."

While the two governmental leaders were raising warnings, both Inslee and Bruce Kendall, the Economic Development Board for Tacoma-Pierce County's president, recalled last year's triumphs. Those included the successful effort to keep Boeing's planned 777X aircraft assembly line and its composite wing production factory in the state, and Tacoma's luring of State Farm Insurance's offices to downtown's vacant former Russell Investments headquarters.

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