Seattle driving away Amazon is not our state’s only economic worry: Water ruling, stifled building damaging our economy, hugely

$6.9 billion in lost economic activity annually. 9,300 jobs and $52 million in employee wages, gone.

No, I’m not talking about Amazon’s recent announcement.

These staggering figures are the estimate of what it will cost us if legislators and the governor continue to do nothing about fixing the Hirst decision.

And while Amazon’s news is extremely worrisome, it directly affects an area that is undergoing an economic boom. Unfortunately, some on the left actually think that Amazon expanding elsewhere is a good thing, arguing that it gives Seattle a chance to “catch up” on infrastructure and housing. Wow. Chicago, L.A., Denver, Boston, and other metropolitan areas must be shaking their heads in disbelief at this mistaken attitude, even as they prepare to make strong pitches for HQ2.

But these job losses from the Hirst decision are mostly in rural areas. These places aren’t part of the Seattle tech boom. They need more good-paying jobs, not a court-led reduction of them.

Impacts the whole state
Rural areas may be hurt more by Hirst, but like the Amazon situation, it’s really a problem for the whole state. It doesn’t only affect rural areas, just as Amazon building a second HQ elsewhere doesn’t just affect Seattle. State government will lose tax revenue, and local governments will feel it even more.

According to the report by HR2, commissioned by the Building Industry Association of Washington, state and local governments will lose out on $393 million in annual tax revenue. Small rural counties arlready struggle mightily just to cover state-mandated services, without providing a lot of extras. Hirst exacerbates their problems.

Speaking of broader effects, Hirst impacts homeowners who have no intention of building in a rural area with a well. If left unfixed, the court’s decision will mean a $37 billion devaluation of rural property, by the report’s estimate. Property taxes will be shifted to urban areas, meaning those homeowners will pay more.

Olympia complacency
Apparently the lack of a capital budget has not been enough to shake legislative Democrats from their complacency about Hirst. Some Democratic moderates voted for Sen. Judy Warnick’s (R-Moses Lake) fix bill, but it was stifled in the House. Given the tight 50-48 margins in the House, those moderate votes suggest that the bill would pass in the House too, if it were brought to a vote.

That hasn’t happened. House Democratic leadership is under pressure from allies, namely environmental groups and some tribes, to hold out on a fix. They also hope that next year the Senate will be under Democratic control, so they won’t have to accommodate Republican views.

But the new report on job losses and lost economic activity provides a renewed impetus to fix this problem soon. Sen. Randi Becker (R-Eatonville) said, “[House Democrats] had six demands and we agreed to five. That’s compromise. Time for some compromise on their part.”

Gov. Inslee, meanwhile, is acting like this is just something legislators need to figure out on their own. Leadership would be stepping up to find a compromise. Even just signaling that he would sign a compromise bill, and indicating what he hopes to see in it, could break the logjam, but he hasn’t done it. That’s its own kind of signal.

Too many in Olympia would prefer to sweep this whole matter under the rug. Instead, they need to take a deep breath, show some leadership, and resolve this thing – for the good of our economy.
-Rob McKenna

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Rob McKenna
Rob served two terms as Washington’s Attorney General, from 2005 to 2013. He successfully argued three cases before the U.S. Supreme Court and negotiated three of the largest consumer financial protection settlements in national history, all involving mortgage lending and servicing. He is a recognized leader in the development of consumer protections on the internet, in data protection and privacy regulation.