Boeing contract in spotlight after Washington governor signs incentive bill

Boeing contract and incentive bill: Boeing has sought the tax benefits — valued at $9 billion through 2040 — and a broad new contract with the machinists as part of a long-term deal to build the 777X in the Puget Sound.

Mark Mulligan/The Herald/AP
Machinists chant 'just say no,' during a rally at the Everett Machinists Union Hall, Nov. 11.

Gov. Jay Inslee gave final approval Monday to a package of tax breaks for Boeing Co. in hopes of landing the company's new 777X, signing legislation at Seattle's Museum of Flight at Boeing Field.

Now attention is focused on a contract vote later this week by the Machinists union.

Boeing has sought the tax benefits — valued at $9 billion through 2040 — and a broad new contract with the machinists as part of a long-term deal to build the 777X in the Puget Sound. In unusual swiftness, lawmakers returned to Olympia last week for a special session dedicated to Boeing, approving the legislation ahead of the union vote.

Some machinists have indicated opposition to the contract because it includes concessions — and a large crowd of workers gathered Monday afternoon to rally against the proposal in Everett. Political leaders, including many Democrats who are closely aligned with unionized workers, have declined to encourage machinists how to vote but have asked them to consider the broader impact on jobs and future generations.

"I do know that the competition is very tough and that there are a lot of people rooting for our failure," said U.S. Sen. Patty Murray, D-Wash., when asked about the union vote.

Asked whether the machinists could get another chance if they reject the current contract proposal, Murray said Boeing was moving quickly on its decisions: "We have the opportunity to build this plane here. I hope we take it."

Tom Wroblewski, president of the Machinists District 751, stood with Boeing representatives and political leaders at the bill signing Monday. He declined to give his opinion on the contract and said it was a very emotional decision for members to make. He said they need to consider what's best for their families, including their grandchildren.

"What's at stake here is jobs for the future — jobs to build the 777x for 20 to 25 years," Wroblewski said.

Union members are set to vote Wednesday.

Ray Conner, CEO of Boeing Commercial Airplanes, said the company's preference is to stay in the Puget Sound and a positive vote by the machinists this week makes that decision easy. But he said it's not a bluff that the company could move the 777X line elsewhere.

"My sincere hope is that we don't even have to even think about doing this," Conner said.

Boeing, with its tens of thousands of workers in the Puget Sound area, has great influence in the state Legislature. But some lawmakers are sensitive about tax breaks for the Chicago-based company. In 2003, the Legislature passed a broad package of tax breaks and other benefits for Boeing — all in an effort to keep the company's 787 manufacturing in Washington. However, in the years that followed, wing production was placed in Japan, and a new production line was established in South Carolina.

Inslee has said the latest proposal includes protections that require key manufacturing work of the new 777X to remain in Washington.

Along with extending tax breaks to 2040, lawmakers this past weekend also approved millions of dollars for training programs for aerospace workers. Lawmakers have also said that Boeing supports the development of a large transportation package, and the Legislature is still exploring a plan valued at about $10 billion.

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