Kitsap Business and Economy

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Archive for August, 2012

AWB chief: For manufacturers, action speaks louder than words

Friday, August 31st, 2012

By Don C. Brunell, president, Association of Washington Business

Barack Obama and Mitt Romney tell voters they want manufacturers to stay in America and create new jobs. The president even promised an audience in New Hampshire that he’d create 4.5 million new jobs, half of those in manufacturing.

Why all the talk about manufacturing?

Our country is the world’s largest manufacturing economy with 21 percent of the global manufactured goods produced here. China is second at 15 percent, and Japan is third at 12 percent.

U.S. manufacturing supports an estimated 18.6 million jobs, with one in six people employed in plants and factories. In Washington, 256,600 people work in manufacturing.

The largest manufacturing employer in our state is Boeing, with 80,000 people, but plants and factories are scattered across our state. For example, Schweitzer Engineering Labs, founded in Pullman 30 years ago, employs 3,500 people.

Manufacturing jobs pay well. According to the National Association of Manufacturers, manufacturing employees earn an average of $77,186 per year.

Manufacturing is linked to another part of our state’s economy — exports. On a per capita basis, Washington is the nation’s leading exporter, and manufacturing accounts for 77 percent of our state’s exports. In a state that’s home to Boeing and Microsoft, it may be surprising to learn that nine out of 10 of those exporters are small businesses.

So now that we’ve established manufacturing’s importance, what has to occur to fulfill Barack Obama’s and Mitt Romney’s campaign promises?

Here are key things the president and Congress can do.

First, they can eliminate the policies they implemented that put American manufacturers at a competitive disadvantage — policies that push costs for American firms 20 percent higher that their global competitors.

The explosion of federal regulations is a key disadvantage, costing $1.7 trillion annually. According to a new study by the Manufacturing Alliance for Productivity and Innovation, regulations on U.S. manufacturers are expected to reduce industrial output by $500 billion and could reduce exports by as much as 17 percent this year alone.

Even more disturbing, since 1998, the growth in regulatory costs has far outpaced the growth of the manufacturing sector. Major regulations are defined as those with compliance costs in excess of $100 million. The Obama administration has imposed an average of 72 such regulations on manufacturers each year, compared to 45 per year under George W. Bush and 36 per year under Bill Clinton.

Second, our corporate tax rate is the second highest in the world among industrialized nations, trailing only Japan. Seven out of 10 manufacturers pay income tax at individual rates, and even though the Bush tax cuts are characterized as giving the rich a break, any increase on individuals is a tax hike on the majority of our manufacturers.

Third, lawsuit costs in the United States are the highest in the world. In 2009, litigation costs were $248 billion — $808 for each man, woman and child in the nation. Adjusted for inflation, that’s a 700 percent increase since 1950.

Fourth, health care costs have increased an average of 12 percent a year over the last decade, and with the implementation of the Affordable Care Act (aka, “ObamaCare”), costs will rise dramatically for employers, workers and their families.

Fifth, schools must emphasize science, technology, engineering and math (STEM) to ensure that graduates have the skills to get those good manufacturing jobs.

Finally, in Washington, where low-cost electricity has been a key advantage, elected officials and regulators need to ensure that we have a dependable supply of affordable electricity for our homes, factories, hospital and businesses.

Campaign promises are nice, but in the end, they are only words. Action speaks louder than words, and action is what’s needed if the U.S. is to remain the world’s largest manufacturing economy.


Sherrod gets new electricity meter this morning

Wednesday, August 29th, 2012

Readers,

PSE came out this morning and replaced Chris Sherrod’s meter. I’ll follow up with PSE on Sherrod’s allegation that PSE rounded up, but now down, his readings.

http://www.kitsapsun.com/news/2012/aug/28/utility-customer-go-round-and-round-over-meter/

Rachel Pritchett
rpritchett@kitsapsun.com
360-475-3783


Kitsap gas again rises above $4

Thursday, August 23rd, 2012

By Rachel Pritchett

The price of gas just keeps getting higher, with no end in sight.

Fueling the price spike, in part, is anticipation of Fed Chairman Ben Bernanke’s announcement next week he’ll take steps to aid the sluggish economic recovery. That anticipation is pushing up the price of oil. A commentary today by CNN Money writer Paul La Monica was titled, “Oil near $100. Thanks a lot, Fed.” Here’s that piece:

http://buzz.money.cnn.com/2012/08/23/oil-economy-gas/

Couple that with the West Coast still experiencing supply and demand problems from the California refinery fire early this month, and we motorists are, well, stuck.

The average price of a gallon of unleaded today in Kitsap County is $4.00, up from $3.92 last week, and $3.61 a month ago. Washington’s average — also $4.00 — is third highest in the nation. Hawaii is first with $4.26 and California is second with $4.12, says AAA.

You’re welcome to post your best recommendation for getting gas locally here. It may or may not be different from the lowest-gas price list we have at kitsapsun.com. As for me, I’m using Fred Meyer on Wheaton Way, at present. This morning, I paid around $3.83 which included 3 cents off per gallon with my Rewards card. With a 52-mile round-trip daily commute between Bainbridge and Bremerton, for many years I used the Masi Shop or Longhouse on Highway 305 between Poulsbo and Agate Pass. But the price at those place this morning was around $3.98.

Others in the newsroom like the ARCO on Wheaton, which was $3.86 this morning.

The state with the lowest gas prices today was South Carolina, where the precious liquid was going for $3.44 a gallon.

Ouch.


One of Kitsap’s biggest commercial sales ever is taking place now …

Thursday, August 16th, 2012

… it is Encore Community’s $25.2 million sale of its 13-acre campus in Silverdale that includes Clearbrook Inn, Northwoods Lodge and Country Meadows to a Tennessee-base health-care investor.

As far as I can tell, it’s the second-largest ever commercial sale in Kitsap County.

Anyone want to guess the first? That was the shopping plaza in Silverdale that includes Safeway, Jo-Ann Fabrics & Crafts and Staples. The $34 million sale occurred in November 2006 and the buyer was an investment group. It’s since turned over again.

I’m pulling my story together now. Look for a remodel right away as Northwoods get converted to all private rooms.

As it stands now, you’ll be able to view my story starting this evening at kitsapsun.com.

Rachel Pritchett


No interest in increasing Port of Bremerton board

Wednesday, August 15th, 2012

BREMERTON NATIONAL AIRPORT — It floated like a lead balloon in 2010 when former Port of Bremerton Commissioner Bill Mahan proposed enlarging the port’s Board of Commissioners from three members to five.

Thus was the case again Tuesday night when Commissioner Roger Zabinski timidly asked whether there was any interest in taking up the matter in a future study session.

“It’s really difficult for two commissioners to talk,” he said of the conundrum that happens when two of three commissioner talk with each other, violating government open-meeting law.

“Is there interest to even have discussion at a study session?” Zabinski asked.

Besides a few guffaws, there apparently was zero reaction.

The matter was quickly discarded.

— Rachel Pritchett


State jobless rate rises in July

Wednesday, August 15th, 2012

Washington’s unemployment rate rose from 8.3 percent in June to 8.5 percent in July, the state Department of Employment Security said today.

At the same time, the state gained 5,000 jobs in various “other industries” sectors, including equipment repair, religious activities, dry cleaning, funeral services, pet care and dating services.

Job losses were reported in the professional and business services sector.

The rise in the unemployment rate stemmed largely from a 9,700 decline in the total workforce and a small increase in the number of unemployed who are looking for work, according to the department.

— Rachel Pritchett


Gas no bargain, even on the reservation

Thursday, August 9th, 2012

It may be my imagination, but it seems as if the price for unleaded regular gas sold on the Port Madison Indian Reservation now occasionally is drifting higher than average off-reservation prices. I’m not sure that happened in the past. Maybe I’m wrong.

On Thursday, the price at the Masi Shop on Highway 305 was $3.80. The average price throughout Kitsap County was $3.74 on Thursday, according to auto club AAA.

I contacted the state Department of Revenue to see if there’d been a change in the tax arrangement with tribes. The folks said no.

I contacted Russell Steele, chief executive officer of Port Madison Enterprises, the business army of the Suquamish Tribe and operator of the tribal gas stations. He said there’d been no change with the tribe either, nor had the tribe changed its profit margin.

So for any answers, I’m running on empty.

One thing for certain. The prices everywhere are going up fast again. Just between Wednesday and Thursday, the average price across Kitsap County rose 6 cents, AAA said. We’re paying close to what we paid this time last year ($3.78).

— Rachel Pritchett, 360-475-3783


Ace leases out Dickey Road asphalt plant

Thursday, August 9th, 2012

Readers,

Granite Construction, Inc., of Watsonville, Calif., has signed a lease with Ace Paving Co. of Bremerton to operate an asphalt plant off Dickey Road in Central Kitsap. I just learned of it recently.

The lease started June 1 and will continue through the construction season, according to Granite spokeswoman Jacque Fourchy.

Ace Paving has four asphalt-production plants in all and the short-term lease is just for the one.

Ace Paving, a longtime local company, has encountered financial strain in the slower economy.

Ace partner Roy Christopherson, alluding to tough times, said only, “We’re in a changed situation.”

— Rachel Pritchett, business reporter


Port leaders discuss breaks on the breakwaters

Wednesday, August 8th, 2012

Readers,

It’s only early August, well ahead of the fall budget-writing season, but already Port of Bremerton commissioners are tossing around which work projects they’d like to fund next year.

Commissioners discussed the placement of restrooms on the breakwaters at the Bremerton and Port Orchard marinas, at $100,000 apiece. One for the Bremerton Marina is in the current budget though the grant money that covers 75 percent of the cost hasn’t arrived yet. They talked about putting a line item in the 2013 budget for the Port Orchard Marina.

The price tag astounded fiscal conservative and newest Commissioner Axel Strakeljahn.
“You’re telling me it’s a $100,000 project?” he asked. Yep, they answered.

Discussion of more modest port-a-potties didn’t go anywhere.

Port staffer Steve Slaton, who oversees the marinas, and port CEO Tim Thomson said the golden potties will boost use of the marinas. Boaters, walkers and participants of events at the marinas now have to walk to shore when nature calls.

“We think it’s an attribute that would be appreciated by the public,” Thomson said.

Also, they spoke about spending as much as $40,000 in grant money to study whether it would work to have a recreational-vehicle park somewhere near the proposed new site for Bremerton MotorSports Park (BMP). Commissioners decided to hold off on a study for a while until BMP gets a little farther into fundraising for the relocation.

Also up for discussion was a rebuild of the Harper Pier, dependent on receiving grants. Slaton was to be in Olympia on Wednesday to make a plea for the grant money, but he admitted there’s a lot of competition. Commissioners want Kitsap County to help with restrooms and parking, but haven’t had much luck.

Commissioners seemed to agree they want the port to be ready for any opportunity that might come about to support a marina at Seabeck. They thought it might work to begin putting $100,000 aside each year into a fund in anticipation of any opportunity, such as purchasing uplands for parking, for instance.

They also talked about logging an 11-acre section between the port’s industrial park and Highway 3, so that passers-by could see it and want to bring business there. No decision.

And, while the port’s website was redesigned only a year and a half ago, commissioners and staff consider it cheap, limited and hard to use. They are looking at $30,000 for a site revamp.

Enlargement of the Port Orchard Marina Park and improvements to a nearby boat ramp now are slated for this fall, rather than this summer. The port is waiting for permits to come through.

More work gets done on the road that is to lead into the South Kitsap Industrial Area if and when grants come through.

The budget get-together was the first of three preceding more formal deliberations later this fall. The next one is tentatively scheduled for 6 p.m. Aug. 27.

— Rachel Pritchett


Have you recently gotten into the taxi-cab business?

Tuesday, August 7th, 2012

If so, consider giving me a call for a story I am preparing.

Thank you,

Rachel Pritchett, reporter
360-475-3783
rpritchett@kitsapsun.com