Washington state may be losing its largest market for apples given Mexico’s new retaliatory tariffs on U.S. imports. Agricultural stakeholders say they are disappointed that they are being targeted by the trade war and are urging President Donald Trump and his administration to consider how important their products are for the economy.

On June 5, Mexico announced it is imposing tariffs on $3 billion worth of American products including pork, steel, cheese and agricultural products in response to Trump implementing levies on Canadian and Mexican steel and aluminum on June 1, at 25 percent and 10 percent, respectively.

One hard-hit industry is the U.S. apple sector, which will now experience a 20 percent tariff when entering Mexico.

Washington produces two-thirds of all apples in the United States. The state represents 90 percent of all U.S. apple exports on an annual basis, and approximately one-third of Washington apples are sent to over 60 countries. Mexico has consistently been the number one export market for these fruits.

Todd Fryhover, President of the Washington Apple Commission (WAC), told Lens that Mexico has received slightly over 10 million boxes of apples each year and the country absorbs between 10 percent and 12 percent of Washington’s crop. Each year, the trade between the two countries is estimated to be between $200-$215 million.

Fryhover estimated that as of the time Mexico instated the tariffs, approximately 20 percent of the 2017 apple harvest is left unsold. The produce must be taken care of before the August harvest begins.

“It certainly feels like agriculture is taking the brunt of these trade issues, there is no question about that,” said Fryhover.

“The 20 percent tariff is problematic because they have a 12-month product need for apples year-round,” adding that the current duty to India is 50 percent, but it may be raised to 80 at some point before June 21.

“We are definitely feeling the financial impact of these trade discussions or disruptions,” said Fryhover. “Our only focus right now is trying to find some type of resolution and suggesting that the Administration find some sort of resolution before the next time our crop is being harvested.”

Fryhover also said that the sector is altering its sales patterns and considering other markets that don’t have harmful duties. The situation is fluid, however.

That said, Washington growers and distributers will not be able to move the same number of apples traditionally sold to Mexico into three or four other markets.

“Volumes will continue to ship to Mexico, but the market will have to determine at what price and who will absorb that cost.”

On the producer side, “It’s always a bit disheartening whenever someone specifically mentions the produce you grow” during a trade dispute, April Clayton told Lens. She is an organic apple farmer and runs Orondo-based Red Apple Orchards with her husband

“Until they finalize everything, there is nothing farmers can do besides talk to our congressmen and legislators and let them know how it will affect…business.”

It’s scary for anyone working in agriculture, she added, and it’s unfortunate that the sector is one of the first hit by a trade war.

“It’s a problem because if it cuts off your relationship with a trade partner and you have to take the time to build new relationships with other countries to send your fruit to. This is especially hard when farmers don’t have much time with the fall harvest approaching fast.

“If millions of pounds of apples don’t find a home or are not able to be sent to Mexico, then it will flood the market here in the U.S. and decrease its value…there definitely is a concern for apple growers whether they sell in the U.S. or Mexico.”

The post Trade war bites Washington apple industry appeared first on Lens.

Lens sat down with State Sen. Steve O’Ban (R-28) to discuss the Seattle City Council’s decision to repeal its business head tax, as well as what Washington can do to better incentivize employers to move to the state and support the local economies.

The post Lens Video: Head tax- Sending the right message to business appeared first on Lens.

The city of Seattle’s short-lived head tax may be dead, but for some state officials a cloud of uncertainty still hangs over the long-term health of Washington’s economic climate – even as the latest state report shows strong regional growth in both jobs and revenue.

Similar worries have been raised by state economists regarding recently announced tariffs by President Trump on Chinese products and the effect it will have on Washington, a major trading partner with China and the most trade-dependent state in the nation.

After a month of backlash from both Seattle residents and the local business community, the Seattle City Council rescinded the $275-per employee head tax that it had unanimously adopted. However, some state officials remain concerned about its lingering impact on attracting new businesses.

Those apprehensions were expressed by State Department of Commerce Director Brian Bonlender in an interview with TVW following the tax’s repeal. “The head tax proposal has created a perception problem…that we often have to discuss as to how that may or may not be related to a company that we’re recruiting to the region. I do believe that (the head tax) creates a perception issue,” and “that problem is beyond the borders of the city of Seattle.”

Still, that perception has yet to be reflected in Washington state’s potential business deal with Boeing to build its 797 jet, an effort headed by the Choose Washington New Middle-of-the-Market Airplane (NMA) Council. An Aerospace Competitive Economics Study released earlier this month found Washington was the most competitive state, citing among other things the state’s lack of an income tax and its high number of research and development companies.

The long-term ramifications of the Seattle head tax were once again a point of interest among panel members at the state Economic and Revenue Forecast Council’s (ERFC) June 19 meeting. When the issue was raised by State Treasurer Duane Davison, ERFC Executive Director Steve Lerch said that if businesses moved from Seattle to other parts of the Puget Sound area, “it wouldn’t have much an impact on our forecast. It seems to me that at least for a lot of the existing firms, (it’s) much less expensive to gradually move to Bellevue. We can think of some firms…that have offices in both Seattle and Bellevue, already.”

However, he added that the media attention Washington has received as a result of the tax “probably is not altogether positive.”

“I think probably the bigger question is to what extent does this impact firms that were thinking about moving here,” he added. “I think that’s really hard to know. The fact that it was repealed has got to offset some of those concerns, but it’s certainly got a lot of press. This is something that the national business community is aware of.”

Yet, the most recent ERFC report shows a strong Washington economy that continues to outperform the nation, with a 4.7 percent statewide unemployment rate that has been unmatched since June 2011. Seattle home prices have also increased by an astounding 86 percent since December 2011.

Along with that prosperity comes more money into state coffers, with 16 percent growth of the Near General Fund State revenue from the previous biennium, and an estimated nine percent increase between the current biennium and 2019-21.

However, Lerch cautioned that the economic forecast doesn’t account for recently-announced U.S. tariffs on Chinese products such as steel and aluminum because the news came out the same day the report was released. Critics have warned that the tariffs could instigate a trade war between the U.S. and China, in which Washington would be among the biggest casualties. Indicating strong trade ties between Washington and China is the fact that the state experienced strong export growth with that country last year, despite overall negative export growth.

“The impact of these tariffs might push that (growth with China) the other way,” Lerch said. “By September or November, we’ll have a better sense of the impacts that’s going to have.”

Any drop in economic growth could also create problems of the state legislature as it looks to fund the 2019-21 biennial budget. Even with the increased revenue expected, state Office of Financial Management Director David Schumacher warned in a recent letter to state agency directors that they “should be prepared to manage with minimal or no funding increases. Forecasted revenue growth is not likely to meet current demands on the state’s resources, including mandatory caseload and cost growth, maintenance of the K-12 and health care systems, and spending increases for critical mental health programs, employee compensation and other services.”

In a recent blog post, Washington Policy Center Government Reform Director Jason Mercier wrote “Hopefully cooler heads will prevail on the trade front to avoid sabotaging our state’s strong economy.”

The post Worries linger over Washington’s economic growth appeared first on Lens.

Lens sat down with two Woodinville winemakers to discuss what the city has to offer for starting winemakers, and why it became a hub for wine tasting even though it is located hours away from many of the state’s vineyards.

The post Lens Video: Woodinville- An unexpected hub for wine appeared first on Lens.

When planning a trip to taste Washington wine you don’t have to travel five hours east of Seattle. Woodinville is only 30 minutes from the city and has transformed over the past few decades into a hub for experiencing great wine varieties from across the state. Although many of the grapes are sourced from a few hours away, more than 100 winemakers make their home in Woodinville, and in the process bring in approximately 795,000 wine visitors each year.

The industry has seen some impressive growth over the years. In 1981, there were 19 wineries; now there are 950. In 2013, King County produced over 2.2 million cases of wine, with the majority coming from Woodinville, bringing in $357.6 million in revenue.

“I think it is probably the most unique industry there is in the world,” John Bigelow, Owner of JM Cellars, told Lens.

Bigelow originally worked in high tech but ended up starting a winery in Seattle with his wife in 1988 in the basement of their house. He quit his job and dedicated himself to learning how to make wine.

In 2000, he ran low on money and went back into tech and made wine at night or on the weekends. Over the next five years, Bigelow grew the business from 300 cases of wine to about 3,000 cases. In 2007, he quit high tech for the second time and planted his own vineyard.

He primarily sources grapes from vineyard acreage he purchased in Royal City and Walla Walla.

“Woodinville is a very strange place to have wineries,” said Bigelow. “There are no grapes that are used here for winemaking. All the grapes are 2 and a half to 5 hours away over in eastern Washington.”

Bigelow attributes Chateau Ste. Michelle as the “anchor” for the city’s success in attracting winemakers.

The winery opened in Woodinville in 1976 which featured a tasting room which attracted many people from Seattle. After seeing that success, several small winemakers started opening businesses around Ste. Michelle.

In 1988 there were four tasting rooms in the area, said Bigelow. Last spring, there were 57 tasting rooms within a mile of the JM Cellars property.

“It gives you a sense for how fast this industry is growing.”

Bigelow sells 97 percent of his wine through his winery and 3 percent through a distributor, which focuses mostly on restaurants. He added that he pays the company extra to have his wines poured by the glass at several different restaurants.

“To me that’s the best advertising I could get is to have someone tasting my wine versus seeing another bottle in a magazine,” said Bigelow. “I want people to experience the wine and then come out to the winery and experience our environment…that’s how we get loyal customers.”

Around 80 percent of Bigelow’s wines are red. His winery features Tre Fanciulli, named after his three sons, which is a blend of Cabernet Sauvignon, Merlot and Syrah. The wine typically scores 90 points or higher each year by scoring groups. Another popular choice is the Cinsaut Red, which Bigelow calls his alternative to Pinot Noir, which is easy to drink.

The winery makes about 6,000 cases each year, which has stayed that way since 2009. Although most businesses look to expand, Bigelow said he has reached the perfect size.

“My goal is to make the absolute best wine and the best way for me to do that is to stay small and focused on just what I do very well.”

Lisa Packer, owner of Warr-King Wines, started out working in marketing for a tech company. She ended up taking a break and was persuaded by her friend who was the daughter of a winemaker to look into the wine industry. She worked alongside a winemaker for two years as part of an internship and realized that she wanted to make her own wine.

Packer started making her own wine and was encouraged to move next door to the winery she had been working at. She went from producing a handful of barrels at the start to opening her winery in 2016 with a tasting room. The winery has produced 1,100 cases this year.

“The nice thing about being here in Woodinville is that it’s a very collaborative environment,” Packer told Lens. “The warehouse district has a startup mentality…most of us start working together and we share equipment and collaborate ideas.”

One effective program to help spread awareness of local wineries is Passport to Woodinville Wine Country, hosted by Woodinville Wine Country (WWC), which aims to bring people into the industry. Over the last year, Packer said this program has helped her business grow by 40 percent.

“It is a way for people to discover undiscovered wineries. Participants get a book of 12 or so wineries to try…it’s a walk through Woodinville to show what we do differently, how we approach wine and getting you into the community and seeing the great things we do here.”

Woodinville is a really unique place, she added, “not only are there fabulous winemakers, but there are really great restaurants and places to stay…. it’s a great place to come for a weekend…make it a staycation and visit us.”

Sandra Lee, Director of WWC, said the marketing organization helps connect the media and consumers to the wineries and builds relationships with are destination marketing area groups like the Port of Seattle, she told Lens.

“We collectively are able to get the word out about the quality of wine and the different experiences you can have here.”

The organization also hosts a variety of events to encourage people to come out and experience Woodinville wine to go along with events that each winemaker might host at their own winery. One popular choice is “A Brush of Pink” where local artists partner with winemakers to showcase summer wines and different displays.

“You would never think that tourism would grow in a suburban area outside of Seattle, but because of the Chateau and the wineries, the infrastructure over the last decade has really filled in the gaps.”

The post A look into Woodinville’s thriving wine industry appeared first on Lens.

It’s no secret that the Puget Sound region has a housing and traffic problem, but some local and regional lawmakers say regional policy for managing it may need some fine-tuning to help alleviate housing challenges.

The problems were highlighted during a July 5 meeting of the state Growth Management Policy Board (GMPB), which includes members of the Puget Sound Regional Council (PSRC).

VISION 2050 is the PSRC’s growth strategy for incorporating over a million new residents that are expected to arrive in the next 22 years. However, already the region is experiencing historic growth, housing prices and traffic congestion. The city of Seattle is the fastest-growing city in the nation and the metro area spent more than 19 weeks atop the list of the nation’s fastest housing price increases.

Meanwhile, in February, Kirkland-based INRIX reported in its Global Traffic Scorecard that “Commuters around Everett, Washington spent more time stuck in traffic than anyone else, with a congestion rate of 28 percent on highways in and out of the city.”

“We have a pretty significant regional housing and jobs balance issue,” Pierce County Councilmember Derek Young said at the July 5 meeting. “The market can drive a lot of growth into one area, but also (so can) our policies trying to get the jobs where people want to live.”

The rising home prices have led to an increased percentage of residents spending more than half their income on housing. According PSRC data, the median home price in the region has jumped from $267,000 in 2011 to nearly $500,000. Average monthly rent has also increased from $1320 to $1900. Although median household incomes have also gone up, a significant discrepancy remains among the counties.

A June 28 PSRC memo states that this: “threatens the social fabric of local communities, and presents a challenge to the region’s economic development.” A recent PSRC opinion survey found that both the cost of living and housing affordability were a greater concern than traffic congestion.

Young added that current PSRC policy has partly driven job growth into certain cities and “put the housing largely in other areas. Folks (are) clearly being driven for economic reasons to the furthest reach of our region. I think we have to figure out a way to serve those folks.”

Seattle’s disproportionate share of the region’s employment is reflected in figures from PSRC showing that between 2016 and 2017, the metro area gained 51,700 of the 57,900 new jobs created.

Bremerton Mayor Greg Wheeler said that the housing market is forcing people into areas like Mason County, but they’re still commuting to Seattle for work. While Port Orchard Mayor Rob Putaansuu views it as an opportunity to revitalize their downtowns by serving as bedroom communities for Seattle commuters taking the ferry, Wheeler said there are downsides.

“There are obviously fantastic folks moving in, and they’re doing it for economic reasons,” he added. “This is a big concern, because (other) folks are either being displaced or in danger of being displaced. Folks are running out of options in our entire region. I don’t think we can out-build this issue where we have 1.8 million people coming into the region over the next 30 years, and we are already built out in so many centers.”

What makes many Seattle workers willing to endure I-405 and I-5 traffic by living in areas a certain distance away are the massive financial incentives. According to a recent Zillow study shared during the July 5 meeting, increasing one’s commute from 35 minutes to an hour could result in $1600 monthly savings. However, that savings amount was lower for longer commute times.

Port of Seattle Commissioner Peter Steinbrueck argued that “you can’t build fast enough in a growth economy when employment is expanding.”

While he advocates ways to increase income levels to make housing more affordable, County Manager Mike Pattison with the Master Builders Association for King and Snohomish Counties told Lens a more integrated regional land-use strategy can help increase the supply.

“There are jurisdictions in the region that literally allow one unit per acre zoning,” he said. “If the hottest growth areas are an hour and a half drive away from jobs centers, that tells me we have too many restrictions on land use policy in the urban areas. Everybody needs to be doing their fair share. Frankly I think Seattle is doing a good job; they have a way to go, but other jurisdictions have much further to go.”

He added: “We have to start holding the one-unit-per-acre jurisdictions’ feet to the fire and say: ‘It’s time to step up.’ Societally, we have to make a decision and follow through on it. Which do you want – sprawl or density? You can’t have it both ways.”

The post Fixing Puget Sound region’s growing pains appeared first on Lens.

Seattle has become the largest metropolitan city to forbid the use of plastic straws and utensils as part of the plastic utensil and straw ban which took effect July 1. The rule now requires all bars and restaurants to use non-plastic cutlery and straws or face a $250 penalty per infraction, however city management indicated it would work alongside businesses to help them comply before handing out fines.

Several businesses are reporting increases in operating costs due to the higher price of compostable straws compared to plastic.

Staff at Grecian Corner told KOMO News that the additional cost of straws is causing them to leave out utensils for to-go orders “until they become more affordable,” according to Tina Veloras, an employee at the restaurant.

“It’ll have to be a lot of explaining to customers,” she added.

Bubble Tea Shop also indicated they had trouble finding the right size straw to replace the plastic version before the ban took effect.

The change comes months after Lonely Whale led 150 businesses in the “Strawless in Seattle” campaign to remove 2.3 million straws from the city.

“We fully support the plastic ban,” said Bob Donegan. He is President of Ivar’s, a Seattle-based seafood and chowder restaurant chain. “We rely on the oceans and the sea for our fish and we don’t want plastic out there.”

Donegan told Lens he was part of the initial group that the city of Seattle reached out to 10 years ago when setting up the disposable cutlery ordinance. He said that the company showed city staff the plastics they were using and made recommendations on how to diminish and remove them.

The issue was that the state of compostable plastic a decade ago was not great, he added.

“If you put a spoon into cups of chowder it melted and would dribble chowder on you as you tried to eat it. If you tried to fork into a piece of food, the tines would break.”

The city decided to push back the ordinance’s implementation, and Ivar’s has been testing disposable cutlery and straws in its restaurants for the past decade.

Ivar’s also owns Kidd Valley Hamburgers, and one of the issues the company faced was that the thickness of the milkshakes made it difficult, if not impossible, for people to suck the contents through disposable straws. The business also investigated paper straws, however those deteriorated after being left in a milkshake for too long.

The store eventually decided to create a straw with the diameter of a dime which resolved the issue.

Donegan said Ivar’s has the benefit of being selected as one of the larger restaurants for manufacturers to bring new products. This allowed the business to test different straws or utensils before other stores had them.

He estimates that the company has tested 15 different straws over the last 5 years. Once management found a straw or cutlery that they liked, they ordered a few cases and placed them within a restaurant, unannounced.

“We let the staff and customers try it and we pay attention to what sort of comments we get,” said Donegan. “That’s how we determined that paper straws didn’t work.”

He added that one issue with the mandate is that there are very few domestic manufacturers of paper or biodegradable straws, and most are made in China. The next ship carrying compostable straws isn’t due into the Port of Seattle until July 22.

“People have been scrambling to find straws that work between the end of June into July when the distribution will come,” he said.

Another challenge with the mandate is that the 18 cent biodegradable straws cost significantly more money than the 3 cent plastic versions.

To help cut back on the additional cost, Donegan said Ivar’s will no longer be handing out straws, but will have them available on the tables, on the counter or by request.

“We always seek to minimize disposable packaging. We used to give people three or four napkins for each to-go order, now we give them one per entrée. If they want more, we are glad to give them that, but they have to ask.”

Morgan Huether, Spokeswoman for the Seattle Restaurant Alliance (SRA), told Lens that SRA cares about the environment and wants its members to comply with the law.

“We have collaborated with our members to deliver eco-friendly solutions…and worked closely with Seattle Public Utilities to provide the tools needed to comply.”

Restaurants have known that the waiver on plastic straws was not going to be renewed since last fall, so they have had ample time to look at alternatives, added Huether. The goal is to meet customer satisfaction and provide straws that are comfortable for guests and will not fall apart.

“Businesses are as unique as their owners,” she added. “Everyone has tackled it slightly differently.”

Some restaurants started developing strawless lids, while others tested different straws to see which were most effective.

“Our members have really been looking for solutions because they want to be in compliance and meet eco-friendly solutions. They are determined to find a way that is geared towards customer experience and in compliance with this law.”

The post Seattle goes strawless: no more plastic pointy things… appeared first on Lens.

It’s no surprise that Seattle and King County have problems with expensive housing prices and inventory shortages, Seattle was ranked 2^nd on Forbes’ list of fastest growing cities for 2018. Recent data shows that the region is making improvements, however, and best practices include continuing to build a variety of different homes to help ease the pressure on available homes.

The Seattle Times reports that house prices in King County have declined nearly 1.6 percent from May to June, the first time there’s been that month-to-month decrease since the recession. Compared to June 2017, last month saw a 43-percent inventory increase in single-family homes on the market and a 73-percent increase in available condominiums. The median price for a King County home is now $715,000.

Roger Valdez, Director of Seattle for Growth, told Lens that this change across the county might be reflective of a cooling off in the economy. The supply is beginning to catch up with demand a bit and prices are leveling up, though it remains to be seen if this trend will continue.

Valdez said that starting around 2011 Seattle experienced a large volume of people moving into the city who needed housing. The housing industry experienced an uptick in the building of single-family homes, microhousing and apartment buildings.

In 2013, prices started to climb because there were more people moving into the region and city than houses were being built. Valdez said that many people might have been put off by ever-climbing house prices and looked elsewhere to avoid the anxiety of the construction changes.

Elected officials then responded to that anxiety and impose more rules and taxes, he added, which was the wrong time to do that as demand is still pouring in.

In 2014, the Seattle City Council limited where you could build congregate microhousing, restricting it to only neighborhood commercial zones, and it also made the rules more difficult to build.

“It essentially ended up eliminating most congregate housing where you have a shared kitchen. It became impossible to build in the low-rise zone and more difficult to build in mixed-use commercial zones. That took a lot of housing off the table.”

Following the decision, the number of microunits being built and brought online dropped, and construction focused on efficient dwelling units which were bigger and typically more expensive.

Valdez said that constructing more microhousing was one effective method to absorb the tech workers moving into the region who typically wanted to live close to where they worked and didn’t require much space.

He added that a large number of people want to buy a house, but they are living in apartments right now and can’t afford a house. The best solution would be building smaller, less expensive single-family homes, that way a student or young person could move into the apartment that a family moving into a house once occupied.

Seattle for Growth is pushing for creating more housing opportunities including small lot housing, backyard cottages and corner lots, and putting more density in single-family homes.

“More housing is always good for the consumer…people trying to find a house,” said Valdez. “For the sellers, it’s a little of downside because you won’t have a bidding war for your house.”

Mike Pattison, Snohomish County Manager for the Master Builders Association of King and Snohomish Counties (MBAKS), told Lens: “The recent price drop is welcome news for families looking for homes, but it’s far too soon to draw any conclusion if there is a trend at play. As an industry we will be watching it very closely.”

Pattison added that newcomers have continued to move farther and farther out from the city, and those outlying areas are facing growth pressures like they haven’t faced before.

“While King County was unable to absorb the influx of new families, other areas have picked up the slack.”

Pattison added that the most effective home for addressing growth has been townhomes. There is a proliferation of apartment options, but that has been slowing.

Taylor Marr, Senior Economist for Redfin, said that even though the region has been booming economically, the housing inventory has not kept pace to meet that demand.

The last few years, inventory has declined an average of 20 percent a year, according to Marr. The last six months, however, has seen a flip where inventory has grown 4 percent after an initial 30-percent decline in January.

Marr said he first speculated the change was brought on by new houses finishing construction, however the number of inventory compared to all listings was still relatively low. The main reason for the flip has been existing homes, which make up about 80 percent of total inventory.

When breaking down home inventory by price, the middle and lowest price tiers containing starter homes are still experiencing declines. Most of the growth is in the category of homes valued at over $500,000.

“The growth in inventory allows for a bit of ease for new buyers to cash in on all the equity they’ve gained. This might be why you’re seeing more listings in general.”

Less housing competition in Seattle has started causing houses to sit on the market longer than normal which contributes to more inventory; homes that may have sat on the market for 10 days are now sitting for 15 days.

“The more houses, the better,” he added, and affordable housing options are great unless the process ends up slowing down the addition of new housing. Even adding luxury condos will have a beneficial effect on supply, which will ease overall supply pressure for everyone else.

The post Housing inventory woes may ease appeared first on Lens.

Although Spokane was not chosen as the location for Amazon’s HQ2, the city’s efforts were not in vain. The company has announced it would be building a fulfilment center, a warehouse where incoming orders are received, packaged and delivered, west of Spokane slated for a fall 2019 opening. Local business advocates say the move will create 1,500 jobs initially and then later up to 3,000 spots when factoring seasonal workers and will attract more businesses to the area which will boost economic activity for the local community.

Larry Krauter, CEO of the Spokane International Airport, told Lens it is still unclear what the exact “Amazon effect” will be with the new center coming to Spokane, however it will be a welcome change. He is also chair of the West Plains/Airport Area Public Development Authority (PDA)

“We think there is a possibility for up to a dozen businesses to locate around the fulfilment center that we will have either direct or indirect support and indirect or direct benefits.”

One selling point for the fulfilment center’s location near Spokane International Airport is the existing air and road infrastructure that is complementary for business.

The airport can support the needs for air cargo using existing carriers such as Fed Ex and UPS. There is also the potential for Amazon Air to locate to the airport as well.

The airport has been expanding rapidly over the last few years. Krauter said it grew 10 percent in 2017 and an additional 14 percent this year.

“There’s a lot of positive things going on with the economy here and the available infrastructure…these are jobs that are going to have a real beneficial effect on the variety of skills and types of jobs required.”

The city also has the unique relationship with county, which ended up collaborating to create a joint PDA which had not been done before in the state. The PDA board is made of city and county elected officials, airport staff and members from the business community.

As part of the Amazon project, PDA will work in a complimentary way with the county to provide infrastructure such as roadways or the utilities that go along with that, said Krauter.

“I think there’s going to be a lot of potential organic growth that Amazon will influence with existing businesses in addition to new growth that occurs with complimentary businesses that could locate here.”

The influx of jobs will also have an economic multiplier effect via direct and indirect effects from Amazon moving in, which would increase direct and indirect economic activity by about three times, and when factoring in the complimentary businesses moving in would increase that effect by up to 10 times.

Amazon’s new center is also likely to increase direct and indirect business travel and will end up increasing the possibility that members of the community will have more disposable income to travel for leisure.

“The momentum is really going to cascade through the community,” said Krauter.

Krauter added the partnership within the community between government entities, the PDA, the county, the city, the airport and various business entities on the Amazon project will prove that community can band together to get a project of this magnitude done in a short period of time, which hopefully will attract other private sector entities.

Greater Spokane Incorporated (GSI) CEO Todd Mielke agreed that it is important for the city to get the attention of companies around the country by hosting a Fortune 500 company. GSI is a business development organization and a regional economic development entity.

“That’s one of the effects that matters is did we get the attention of a significant business in this nation that decided this was a good community to do business in.”

Mielke added that Spokane was one of the cities vying for the spot for Amazon’s HQ2. The intent there was to get on Amazon’s radar screen as they are frequently starting operations with a few hundred to a few thousand employees.

“Now that we have our foot in the door we need to look at how to grow that potential down the road.”

One benefit of the fulfilment center being built in Spokane is that other companies look at the facility as a magnet for their operations. The city needs to do its research to find which companies would stand to locate in Spokane because of the fulfilment center being near and prepare.

“As a community, not only do you want a good diversification of business sectors and a number of companies in your region, at the same time you want a good diversification of jobs available for people of all different skill levels, backgrounds and education levels.”

Distribution centers tend to appeal to those in the middle realm and the locations also offer benefits not afforded by smaller businesses. Amazon also offers an educational benefit if employees wish to go back to school and expand on their skills or training which would help increase the educational attainment of the local community.

Spokane is an attractive location because of more tame housing prices for the younger population and a more consistent commute compared to the Puget Sound region, said Mielke.

“One thing that is a challenge for any community is that there will be an influx of people and we have to make sure we are building the capacity int his community to make sure people can find housing options.”

The move is an opportunity to adapt to other challenges and anticipate the future needs of the community, he added.

The post The “Amazon Effect” on Spokane’s business community appeared first on Lens.

When looking for a burger in the Seattle area, the spinning Dick’s Drive-In (DDI) sign may be hard to pass up for many Washingtonians. More than a stopping place to grab a low-cost, delicious burger, it is has grown alongside the community throughout the years. It is an institution.

Lens met with Jasmine Donovan, Executive Vice President and CFO of DDI, to learn about how the restaurant got its start and has remained successful as Seattle has continued to change. The granddaughter of DDI founder Dick Spady, Donovan worked in the family business in high school and college as a crew member and rejoined the company as a member of the executive team in 2013.

Spady served during World War II and was sent to Hawaii after turning 18. After the war, he went to college and then served as an officer in the Air Force Reserve Officers’ Training Corps. After graduating with a business degree, Spady was assigned as a commissary officer during the Korean War where he learned mass food service production.

Upon returning home, Spady called both his old navy friend H. Warren Ghormley and also Dr. B. O. A. Thomas, a dentist at the University of Washington who was interested in the McDonald brothers’ store concept, to discuss the fast food restaurant business. The group traveled to California and paid $50 to work for the weekend in one of the businesses that was following the McDonald’s model so they could learn the ropes. The men took notes and brought the concept back to Seattle.

“It was a tough sell locally to offer burgers for 19 cents where people wouldn’t sit down inside and would have to line up outside and eat in their car…it sounded like a crazy concept,” Donovan told Lens.

The friends had a hard time getting the funding needed to open their own restaurant, as fast food was brand new and there were almost no other businesses in the area like it. Eventually they acquired the needed investment and opened the first Dick’s Drive-In in January 1954, located on 45^th Street in Wallingford.

“The concept is they wanted to sell a high-quality burger at a low price, very fast,” said Donovan, and the founder achieved this through the restaurant’s instant service model which did not include the overhead costs of indoor seating.

“People were on the go…they didn’t have time to sit down in a service restaurant anyway, and this was going to be the way they would get food on the way home from work or for a quick lunch in their busy lives.”

Throughout the years Dick’s integrated into the community, with customers celebrating their first car purchase…or introducing their kids to French fries for the first time. These milestone acknowledgements have allowed for generations of customers to keep coming back.

Spady knew the importance of investing in the community, and the business has consistently reflected that value over the years. Past successful charity operations have included the “Change for Charity” and “Round Up For Charity” programs, which have raised almost $2 million for local charities helping the local homeless population.

The company also devotes itself to the wellbeing of its workforce by offering high wages and benefits, including its $25,000 scholarship program over the course of four years, available to employees who have worked 20 hours a week for six months and then continue working while participating in a college, vocational or self-improvement programs. Other worker benefits include 100-percent employer-paid health insurance, 401k plans with a company match and childcare assistance.

Dick’s employees can expect to learn on-the-job skills they can take to their next career and use the scholarship opportunity to pursue their passions, said Donovan.

The restaurant’s model has remained relatively unchanged from the original store on its first day, which compliments the strong generational memories afforded to customers. The business has made mostly minor changes across the years, including adding the deluxe and special versions of the burger offered in the 70s. The restaurants have recently started accepting credit cards as payment options to ensure more guests are able to stop by without first visiting an ATM.

A growing city means more visitors to Dick’s; however, the changes also bring new challenges.

“Regulation is tough and adapting to all the new regulations are challenging, but a lot of what is being regulated is something we’ve taken to heart,” said Donovan. “It’s just different when the regulations come…there’s usually administration burdens that didn’t used to exist, so that’s where there are a lot of costs and challenges.”

Donovan said Seattle has offered the company a strong customer base where Dick’s could be seen as “a constant in an ever-changing world” to the variety of guests patronizing the restaurant. The company has been growing with the community since its start, opening a location in Edmonds in 2011 and making plans to open a Kent restaurant in the fall.

The strong relationship with the community has lessened the need for direct marketing, and for 37 years, the business did not add new locations. While preparing for the Edmonds location to open, the company engaged with customers on social media, asking in what part of town the business should build the new restaurant.

“We have been able to reach a lot of our customers with a lot of new media while staying very classic and old school at our restaurants. It’s our combination of old and new that keeps our brand alive and relevant.”

The post Business Profile: Dick’s Drive-In, then and now appeared first on Lens.

Lens met with Jasmine Donovan, Executive Vice President and CFO of Dick’s Drive-In, to learn about how the restaurant got its start and has remained successful as Seattle has continued to change.

The post Lens Video: Dick’s Drive In- Growing alongside Seattle appeared first on Lens.

Washington’s agricultural stakeholders continue asking the Trump administration to resolve problems stemming from the current trade war between the U.S. and other major trading partners for farm-related products.

President Donald Trump announced a $12 billion farm aid plan in July, however several farm advocates and growers responded saying they would rather the U.S. tariffs be dropped so the industry can work toward regaining normalcy in its export markets.

Mark Powers, President of the Northwest Horticultural Council (NHC), told Lens that the current trade environment has created several challenges for Washington growers.

“The cherry season operated under a retaliatory tariff under China for the entire season. We had to divert shipments, look at other markets, and the return to grower profits were affected.”

At the end of July, President Donald Trump tried to alleviate some of the negative effects when he announced a $12 billion emergency farm aid plan to help farmers struggling within the trade war. The $12 billion strategy includes federal payments to growers and assistance with opening new markets.

Washington growers, however, told Governor Jay Inslee that they are interested in “trade, rather than aid.” Trump has also been criticized by U.S. Republican Senators for not removing the original tariffs outright, as they end up hurting U.S. farmers.

“The aid that has been outlined is marginally beneficial at best,” said Powers, adding that the direct payments outlined in the plan do not apply to fruit growers.

The Washington ag industry also has not traditionally been involved with food purchase and distribution programs. The trade promotion sections would be beneficial, he added, however they would act as long-term solutions.

Powers added that a negotiated solution on the steel and aluminum tariffs would be most beneficial for the agricultural sector, as it is the cause of retaliatory tariffs from India and Mexico. It isn’t as simple of a solution for China, however agricultural stakeholders are urging the Trump administration to begin negotiations as soon as possible and to solve the problem so the tariffs come off farm-related products.

“We are talking with the administration about what would be better designed to assist our growers, but the real objective is to get back to a normal trading environment which is absent with these retaliatory tariffs.”

Todd Fryhover, President of Washington State Apple Commission (WSAC), told Lens that the industry is lucky that the trade war’s immediate effects on the apple industry have been relatively minor. This will not be true of the upcoming harvest, however.

“Essentially we are through the majority of our season and there is less than 10 percent of fruit left to sell. We are gearing up for the new crop, so the impact today is relatively negligible.”

It is fairly normal for shipments to drop off during this time of the year between the negotiations with China and India having its own strong apple industry to make purchases from.

In the current landscape, Mexico has a 20 percent tariff on U.S. apples, and China’s is at 50 percent. It is still unclear whether or not India will increase its current duty of 50 percent to 75 percent or keep it the same. The decision has now been pushed back to September 18.

Washington’s apple harvest typically goes from September to August and should begin in the next two to three weeks. Washington however has a 12-month market open for Mexico, and the country is the apple industry’s number one export market.

Fryhover said that the harvest will be busy through mid-November and then the export season typically begins at the end of September.

Two years ago, U.S. and Mexico experienced trucking issues across the border which resulted in an economic loss of $44 million over that 12-month cycle.

“That’s a big number for an industry like ours and similar to what potentially will happen in the future” with the current export environment.

“Right now, and without any current change to the tariff issue, somewhere just south of 50 percent of all our export market volume is affected by a tariff if India follows through with its tariff increase. That is significant, no question about that,” said Fryhover.

The effects will be felt especially by growers in central Washington. He added that the red delicious variety will be hit hardest since India imported 8 million bushels of Washington apples this year, and 7 million of those were red delicious.

There is also the issue of finding open markets for the upcoming harvest.

“Without any kind of trade liberation or return back to normal I think you are going to see some impact in the Washington apple industry for sure,” he said. “If you can’t export as much, you have to move product in the U.S. domestic market and then you have to consider how that will affect brethren in New York and Pennsylvania who are also significant apple producers.”

The post Washington growers: Remove the tariffs appeared first on Lens.

The Seattle City Council voted this week to prevent the Seattle Showbox concert venue from being torn down and replaced by apartments. Proponents of the ordinance argue the music spot increases Seattle’s attractiveness for bringing in tourists and music lovers and is a symbol for the history created there by artists performing in Seattle.

On Aug. 6, Councilmember Kshama Sawant introduced an ordinance which would designate the Showbox as part of the Pike Place Historic District.  The move would place the location under the Pike Place Historical Commission’s control, which is responsible for managing any construction and new business within the district.

Onni, a developer interested in the site, announced plans to tear down the concert venue and replace it with a 440-unit apartment tower, however the Landmarks Preservation Board denied the plan due to previous remodeling.

On August 13, the council voted unanimously to approve the proposed ordinance. During public testimony, Seattle residents shared memories created at the site and spoke to the effect the venue has had on Seattle’s music history and the economic benefits it has brought the surrounding area.

Tony Kay, representing Save the Showbox, spoke to the importance of the venue for Seattle’s history, and for the city’s ability to market itself as a music destination for travelers and music fans.

“In a city that is constantly changing and a cityscape overwhelmed by massive, shiny, faceless glass buildings that homogenize this very lovely city, the Showbox is a living reminder of Seattle’s cultural and musical history and of the city’s vital, relevant and crucial place in the world consciousness of a music mecca on par with Liverpool, New York, Austin and Nashville.”

Founded in 1939, the venue has hosted acts such as Muddy Waters, Prince and Soundgarden.

“Rescuing this building that has housed so much cultural and musical history and enriched the lives of literally hundreds of thousands of music fans isn’t just giving in to emotional sentiment, it is sending a loud and clear signal to the world that the city of Seattle cares more about its cultural and musical history than its development dollars.”

Before the vote, Councilmember Lisa Herbold told the public that the city’s arts office released a creation, activation and preservation (CAP) report which highlighted the importance of the Showbox decision for areas outside of its immediate area.

“That report says that despite cultural spaces’ role in strengthening neighborhoods, creating and maintaining these spaces in strong real estate markets can be extremely difficult. The older, smaller, more eccentric spaces that often house cultural uses and small businesses are particularly vulnerable to development-driven displacement.”

Herbold also said the site developer agreed to delay vesting to give the council time to delay its vote.

“Although the hold would provide the opportunity for a developer to develop another plan, the description I’ve heard of the plan they are working on calling it a win-win solution gives me great pause.”

The developer’s portrayal of the ‘win-win’ effort was one that could “sustain the performance history of the Showbox’s history into the future.”

Committee meeting attendees booed as Herbold explained that ‘sustaining the performance history’ would likely result in a space within a new building dedicated to live performance rather than protecting the structure.

Now that the council has approved the ordinance, its members will have 10 months’ time to consider how the property will be part of the market, first on an interim basis.

Councilmember Sally Bagshaw said it will be up to the Pike Place Market, its tenants, board members, those within the music community, property owners and businesses to be a part of the discussion on how to preserve the site and its assets.

Bagshaw added that keeping the venue will have a “profound” effect on the Pike Place Market as well as everything that interacts with it.

The post Seattle City Council insulates Showbox venue appeared first on Lens.

A lack of drivers to meet freight demand isn’t a new problem to the trucking industry both nationally or in Washington state, but now it’s starting to affect businesses and customers that rely on them. Also, some believe the problem could get even worse.

The American Trucking Association reports a nation-wide shortage of 50,000 drivers, while Seattle-based Amazon has raised the price of its Prime membership for two-day shipping by 20 percent.

“It’s not just affecting trucking companies at this point, it’s affecting shippers,” Washington Trucking Associations Executive Vice President Sheri Call said. “At some point it’s going to impact consumers. Whether they know it or not, consumers are already feeling it.”

Washington’s trucking industry is composed of 16,670 companies that employ 138,770 people. Altogether, they transport 80 percent of the total manufactured tonnage in the state, and almost 80 percent of Washington communities “depend exclusively” on trucks to move their goods.

However, Becker Trucking Inc. owner and WTA President Frank Riordan told Lens that “we turn down business every day” due to a lack of drivers. He said at one point a company had 300 trucks sitting idle due to a lack of drivers.

“We recruit constantly and have for the last probably four years,” he said.

While the issue has received more widespread coverage, a 2017 ATA report indicates the problem has been around since roughly 2005. That’s when the driver shortage was roughly 20,000 drivers. If nothing changes, that figure could be as high as 176,000 by 2026.

Call says it shows that the new federal electronic monitoring requirements aren’t to blame for the freight shortage.

The report attributes the driver shortage in part to an older driver population that is retiring either due to age or health.  The average truck driver age is 55, according to the Bureau of Labor Statistics.

However, “young people aren’t coming into the industry” to replace them, Riordan said. “They can’t find drivers to haul loads anymore.”

Also, the ATA report notes that many trucking companies “are highly selective in hiring drivers because they have made safety and professionalism high priorities.”

Glassdoor reports the average Class A driver salary is $42,338, and Riordan says that can go up to $60,000. “If you want to be a local guy (where) you’re home every night, you make a wage that can take care of a family,” Riordan said. “We provide medical insurance, retirement, vacation (and) paid sick leave. Some companies are on their third and fourth raise trying to keep people on board.”

One way to fill empty trucks is by lowering the minimum age for out-of-state driving from 21 to 18, he adds. “We can’t even recruit them at 18. In three years, you lose them to other jobs. Nobody waits until 21 to drive a truck.”

ATA supported congressional legislation introduced by Rep. Duncan Hunter (R-California) known as the DRIVE-Safe Act that would accomplish that. The bill has been referred to the Subcommittee on Highways and Transit. Also in support of the legislation is the International Foodservice Distributors Association.

“As a trade association we’re looking for other avenues to attract drivers to the industry,” Call said.

Riordan said: “I think it’s a great industry; it’s the only thing I’ve ever been in my life. How you can order from Amazon and have it shipped in Philadelphia, and in two days it can be on your porch – I still find it fascinating that it happens.”

The post Driver shortage extends beyond trucking industry appeared first on Lens.

Washington state needs to position itself to best take advantage of Asia’s consumer boom, which is where trade stakeholders believe businesses will reap the most benefits. That is just one takeaway from the Association of Washington Business’ (AWB) 2018 Federal Affairs Summit, hosted Aug. 14 in Tacoma.

During the event attendees heard from Washington trade stakeholders, members of the agricultural community and public officials about the importance of trade discussions and how the state’s economy and industries are being affected.

The event focused on Washington’s business community and its stake in international trade, taxes and other federal affairs. Featured speakers discussed the trade relationships between Canada, Mexico and the U.S., the status of tariffs and their effects on the Washington economy, as well as where Washington should focus its efforts to best benefit business owners both large and small.

Over the past few months, Washington businesses in sectors including agriculture and construction have reported challenges stemming from the escalating trade war between the U.S. and trade partners including China, Mexico, Canada and the European Union. Several companies have reported increased material costs and difficulty selling their product amidst ever-changing trade negotiations.

During the “Trade Today in Washington State” panel, event goers heard from stakeholders working with exports and agricultural products.

David Konz, Risk Management & Government Affairs for Tidewater Transportation & Terminals, spoke to the effect the current trade negotiations are having on commodities traveling through the ports.

Tidewater primarily exports white wheat down the Snake and Columbia Rivers. Konz said that luckily the product has not been impacted by the tariffs. However, other popular ag products leaving via the river are not so fortunate.

“If you talk to those that handle corn and soybeans, they are very concerned. I’ve chatted with some of my peers and some of the traders out there and there is a lot of uncertainty of what is going to happen.”

The Soybean crop is typically harvested in October, which is where there will be a lot of potential concern.

“The uncertainty doesn’t help for business,” Konz said.

U.S. Sen. Patty Murray (D-Washington) sent in a video played at the event and remarked on the importance of creating and maintaining trade pathways for Washington industries.

“As business leaders of one of our nation’s most trade-dependent states, I know I don’t have to tell this group about the importance of maintaining and strengthening our trade relationships… Small businesses in communities across our state depend on a robust economy powered by free and fair trade, not to mention strong relationships with partners around the world,” she said.

Murray said she will continue working with organizations such as AWB and listening to business owners’ concerns about fighting “counterproductive policies that would have devastating consequences on so many of our family, friends and neighbors.”

Kristin Kershaw is the Director of Corporate Affairs for Domex Superfresh Growers and Kershaw Companies, a Yakima-based agrobusiness that is one of the largest suppliers of apples, pears and cherries all over the world.

Kershaw spoke to the state’s $4 billion fresh fruit industry where $1 billion goes to export each year. The largest markets for the sector are Mexico and Canada, followed by India and several Asian countries.

The industry has “absolutely exploded” since the North American Free Trade Agreement (NAFTA), and the sector has used the money to invest in the community and evolves based on consumer needs.

“If you take a little drive out to Wenatchee, you’ll see that apple tree that you once knew doesn’t look anything like what has been planted out there. We took that money and replanted and invested in the kinds of apples consumers want today and it has been great for us. We have transformed the American market for consumers.”

The sector wants to build on the successful growth and follow it into Asia. Kershaw said it is $3,000 cheaper to ship a container of produce anywhere in the Asia Pacific than to ship to Boston.

“That’s where we are going to see the growth…whether it’s Boeing airplanes or Washington apples,” she said, adding that the world is preparing for the largest expansion of the global middle class since 2007. Some 2 billion more consumers will exist by 2030, primarily in Asia.

“Asia is poised for some phenomenal consumption-driven growth, and we want to be there.

“When we start talking about trade …and barriers to trade and tariffs, what we are really saying is if we can’t resolve it…we really don’t want to participate – that we are going to sit out the largest explosion of middle-class growth and potential consumers the world has ever known.”

The post Washington’s stake in ongoing trade talks appeared first on Lens.

Washington state is reenergizing its statewide tourism efforts with the approval of a statewide tourism agency in March, however it has a way to go to catch up with neighboring states.

As the Washington Tourism Marketing Authority (WTMA) continues to transition into its role, local marketing agencies and tourism stakeholders say they are excited to have the extra reach with a statewide office, however Washington needs to better market its assets to out-of-state visitors.

According to the Washington Tourism Alliance’s 2018 Washington State Tourism Marketing Plan, one of the main challenges of promoting the state is related to its lack of state funding for marketing – which resulted in the statewide tourism agency closing in 2011.

In 2016, Washington had approximately $700,000 in mostly private contributions to spend on marketing, where states such as Oregon, Idaho, Montana and California had tourism budgets of between $8 million and $62 million.

This past legislative session, lawmakers approved a measure signed into law on March 27 which established WTMA. The authority is currently awaiting funding before it becomes fully operational.

According to the plan, “While nearby states and provinces are well aware of our assets and know what makes us different, states further removed, such as Texas and Arizona, cannot readily distinguish us from other Northwestern states.”

David Blandford, Senior Vice President of Public Affairs for Visit Seattle, told Lens that the marketing organization is focusing its efforts on attracting out-of-state visitors. The organization promotes Seattle, King County and the entire state.

Nearly 1,000 businesses are members of Visit Seattle and partner with the organization to travel overseas to promote Seattle and Washington tourism. They also help host visitors during familiarization trips which promote state attractions such as national parks or urban destinations.

The organization has identified seven main overseas markets for tourism: South Korea, Japan, China, Australia together with New Zealand, France, Germany and the U.K.

“Each is different because different markets want different things and demographics,” said Blandford. “Asian markets tend to focus more on shopping, group tours and iconic attractions. European markets and Australians like outdoor activities…and opt to do individual things such as mountain climbing. “

VisitSeattle builds programs based on what each market is likely to want. The organization then works with tour operators on tour packages and with consumer or trade media to help add exposure for destinations.

John Cooper, President and CEO for Yakima Valley Tourism (YVT), told Lens that tourism is one of the leading sectors behind agriculture in Yakima County, valued at $410 million. The region’s efforts are somewhat limited without a statewide agency, however.

YVT is comprised of several business representatives from restaurants, hotels, attractions, retail, transportation as well as industries supporting tourism, including real estate and construction.

“Some of these businesses are totally dependent on traveling and tourism like the hotels. For others, it helps augment their local sales and use like restaurants,” he told Lens. “The range of their dependency on tourism varies but most definitely from a retail standpoint they do benefit when visitors come to town.”

Yakima Valley’s tourism sector is primarily a “drive market,” that is, most visitors come from driving some distance. YVT primarily focuses on that tourist pool and highlighting the region’s strength in wine, beer and craft beverages for markets outside of the valley.

Over the past 30 years, the craft beer movement exploded out of the valley, and now the region is the major producer of hops in the world.

“It seems like everyone has a brewery now with the big growth in the craft beer industry,” said Cooper. “Our distinct advantage is that we are where the hops are grown, and it is harvest season now. A lot of people like to see the process.”

He added that once the statewide tourism marketing alliance is up and running it will allow YVT to extend its reach beyond the immediate region.

“It gives us new marketing opportunities to tell our story, give us new sales efforts in new markets. Say for example it’s decided based on research that Chicago is a good market for inbound visitors…it might be an opportunity to reach out to the travel agency there and tell them about our wine industry.”

Significant international markets for the valley and the state include Canada, the U.K., Germany, Japan and China.

“As a state we haven’t been able to do much (in those markets) without a state marketing program, and we have to rely on Seattle and the Port of Seattle to help carry the weight.”

He added that local tourism agencies require the “third leg of the stool” which is a statewide program.

Last month, Governor Jay Inslee appointed nine members to the WTMA Board to manage statewide tourism money. Board members include Washington Hospitality Association President and CEO Anthony Anton, A-1 Hospitality Group President Vijay Patel, Adrift Hotels Inc. CEO Tiffany Turner and Spokane Sports Commission Vice President of Marketing and Communications Jodi Kayler.

The board will meet for the first time in late August to decide on which nonprofit will oversee WTMA.

The post Bolstering Washington tourism appeared first on Lens.

While Washington is known for its apples, pears are also a vital part of the state’s economy and offer a unique opportunity for agricultural businesses and growers to sell these two fruits together to best meet consumer demands.

Washington pears make up approximately 60 percent of the fresh pears sold in the U.S. In 2016, pears were the 10^th largest agricultural commodity and the state ranked first in the nation for producing fresh pears.

The state has two major growing areas: Wenatchee Valley, where the majority are grown, and Yakima.

The quality of Washington pears is similar to those from California and Oregon, and fruit grown on the southern side of the states is harvested the earliest. Migrant pickers typically travel up to the Pacific Northwest from California to follow the fruit as it becomes ready to harvest.

“When the harvest comes, it comes fast,” Kathy Stephenson, Director of Marketing Communications for Pear Bureau Northwest (PBN), told Lens.

Once the harvest hits, there is a two-week window for picking.

“When the pear is ready to be picked, we need those workers here and we need folks on the ground because everything is hand-picked.”

About 30 to 40 percent of the pear crop grown in Washington and Oregon is exported depending on the year and strength of the dollar. Mexico and Canada are the Pacific Northwest’s two largest pear export markets, followed by Asia and the Middle East. Domestically, the pear crop is often purchased alongside apples for bundled transport.

PBN anticipates this upcoming harvest will be 26 percent larger than last year’s and will result in 20.5 million boxes of fresh pears. The boxes weigh 44 pounds each and cost between $25 and $35.

In 2017, Washington’s pear production was valued at $246 million. 25 percent of the total volume went to the canned pear industry.

The current trade war between the U.S. and its export markets have affected several agricultural products such as apples, however Stephenson said pear market has been unaffected for now.

“Tariffs don’t affect the harvest or how we are collecting the fruit. When we start shipping there might be a problem. If tariffs rise in main export countries we could run into an issue where we can’t sell as much because the price goes up too high for the consumer.”

Stephenson added that the industry has spent decades to develop relationships in those markets, and tariffs could make it difficult to continue selling to those countries.

Luckily, pears are not currently on the  tariff list for Canada or Mexico, however China’s levies on U.S. pears are expected to affect the industry by $1.4 to $2 million.

Washington pear growers rely heavily on workers living within the communities or those who migrate from the south to support the harvest. Some migrant workers face issues coming back because of immigration challenges.

“We haven’t heard that too many people aren’t getting their crop picked, but it is keeping growers up at night, there isn’t any doubt about that,” said Stephenson.

Stemilt Growers is a fruit growing, packing and shipping business based in Wenatchee which began harvesting pears two weeks ago. Roger Pepperl, Marketing Director for the business, told Lens that the company grows pears which are packed in Wenatchee and Peshastin.

Pepperl said pears are primarily sold alongside other fruit such as apples. 25 years ago, some growers only sold pears, however grocery stores became more efficient with their purchases and preferred to bundle different fruits together.

“What happened was people around the United States who bought apples also wanted to buy pears from the same person, because they could load the fruit in the same truck …and they both were similar enough where they would typically end up on the same retail shelf.”

“The pear became an integral part of what a produce buyer at a grocery store might expect. They create a one-stop shopping business you need for apples and pears.”

The company constantly monitors the controlled atmosphere storage rooms where the pears are kept in a “sleeping” state because fruit could stay in cool storage for 10 to 11 months before they are shipped out.

Timing is important for the success of the pear harvest, so the company places extra emphasis on keeping the produce safe as it travels via trucks or containers because molds and funguses can ruin the fruit.

“There are so many different things…it can become the weak link in the chain to have these challenges and can be detrimental to your whole season.”

The post Large harvest underway for Washington pears appeared first on Lens.

Although the United States has reached an initial agreement with Mexico under the new United States-Mexico Trade Agreement, Washington state trade representatives say they are concerned that Canada has not yet been included in trade negotiations to replace the North American Free Trade Agreement (NAFTA) and worry that the country’s absence will negatively affect trade markets.

The new deal contains much of the same protections as NAFTA and includes provisions related to labor standards and the modernization of global trade. While the agreement might proceed if Canada is left out, Congress was expecting President Donald Trump to include both neighboring NAFTA countries.

It’s no surprise that Trump has aspired to replace NAFTA. While on the campaign trail, Trump deemed NAFTA “the worst trade deal ever made,” saying it has had a negative effect on U.S. manufacturers. He openly discussed the possibility of destroying the agreement and renegotiating with Canada and Mexico. More recently, however, Trump threatened to leave Canada out of a new trade deal if it could not come to an agreement with the U.S.

Washington agricultural leaders say they are cautiously optimistic of the preliminary agreement with Mexico, and they hope a firm agreement can be made soon since the uncertainty caused by the trade negotiations has been harmful to agricultural markets.

“The president’s declaration of a new agreement is a lot of frosting and not much cake, particularly when it comes to agriculture.” Bill Bryant told Lens. “He is talking about how we will reduce or eliminate all tariffs and we already have that.”

Bryant was the Republican gubernatorial candidate who ran against Governor Jay Inslee during the state’s 2016 election. He was an unpaid advisor to both George H. W. Bush’s and Bill Clinton’s administrations during the negotiations of NAFTA, working closely with the U.S. Department of Agriculture (USDA) and the U.S. Trade Representative. Under the George W. Bush administration, Bryant sat on the advisory board of the U.S. Export-Import Bank representing agriculture.

Bryant said the new agreement does nothing to remove Mexican tariffs placed on Washington state agriculture that resulted from Trump’s tariffs on Mexican aluminum and steel which took effect June 1, 2018. The agreement also falls short on protecting agricultural products, he said.

“Some of the real problems such as the tariffs on apples that are in retaliation…those have not been addressed in the course of these negotiations.”

The U.S.-Mexico Trade Agreement includes new language on intellectual property which Bryant said was needed, however some of that language was already present in the Trans-Pacific Partnership (TPP) before President Trump withdrew the U.S. The new trade deal also includes provisions on the environment and new labor standards.

One large difference from NAFTA is the inclusion of labor rules which would require U.S. auto companies assembling cars in Mexico to use American car parts and would mandate that 40 percent of those cars be made by workers earning at least $16 per hour.

Congress gave President Trump the authority to renegotiate NAFTA but did not permit him to work a bilateral agreement.

“A legal argument could be made that if Trump sends up an agreement to the Hill without Canada that it would be inconsistent with his negotiation authority and Congress could make amendments,” said Bryant.

However, it would be up to Congress whether it would enforce its own rights.

“I think there would be serious ramifications for U.S. supply chains to have an agreement which did not include Canada. I don’t understand why it wouldn’t…we have a trade surplus with Canada.”

Bryant also found fault with Trump’s decision not to include members of Congress on the negotiations with Mexico.

Trump tweeted Sept. 1 that “There is no political necessity to keep Canada in the new NAFTA deal. If we don’t make a fair deal for the U.S. after decades of abuse, Canada will be out. Congress should not interfere with these negotiations or I will simply terminate NAFTA entirely & we will be far better off…”

“The NAFTA is incredibly important to Washington State, so there is a huge interest in making sure NAFTA is preserved and improved” in the new agreements, Lori Otto Punke, President of the Washington Council on International Trade (WCIT), told Lens.

Washington state good exports into Mexico increased 700 percent and exports to Canada grew 200 percent since NAFTA was enacted. The agreement resulted in 330,000 jobs for Washington state employees relying on NAFTA partners and trade between its countries.

“Given the bilateral trade relationship between Washington and Mexico, we know having a good NAFTA agreement in place is imperative,” said Punke.

The current details on the U.S.-Mexico Trade Agreement are unclear because of several moving pieces.

Industries within the state are monitoring the discussions closely, she added, and many are concerned about the uncertainty of the agreement at this stage.

“I have a hard time seeing an agreement coming to fruition from a U.S. lawmaker if Canada isn’t included since Congress wouldn’t agree with it,” said Punke.

Washington state trade stakeholders will be focusing their efforts on the market access issue for goods, specifically for agriculture and business services. She added that other areas of importance for Washington state include digital trade and e-commerce updates and barriers that inhibit agricultural trade.

The post Washington’s stake in NAFTA replacement appeared first on Lens.

Green-building advocates and representatives from the housing sector and local government spoke this week at the 2018 Built Green Conference event on hot housing topics including sustainability, building innovations and affordable housing.

The conference was sponsored by GreenTools, a King County program which assists builders, residents, businesses and local governments transition into sustainable green housing.

Key solutions include encouraging a better relationship between public and private developers, more local resources for creating inventory and better policies that promote affordable housing efforts and density.

The conference’s “Development and Displacement: A Discussion on Equitable Social Impacts” panel discussed what is being done to address the region’s housing crisis, as well as what policies best pave the way for more affordable housing options.

Marty Kooistra, Executive Director of the Housing Development Consortium of Seattle-King County, said the region would need 156,000 affordable housing units to accomplish the King County Regional Affordable Housing Task Force’s objective to house people who are currently homeless or cost-burdened. Looking ahead to 2040, the region would need 244,000 affordable units to meet the need.

“Whatever we are doing we are woefully short,” Kooistra said.

The county has several challenges to its housing goals: the region is topographically defined, has extremely high land costs and runs a transit system that is 50 years behind what it should be, he added.

One obstacle is the lack of resources available to correct the issue of affordable housing. The City of Seattle has $270 million worth of application requests going into the office of housing with only $40 million to address those, according to Kooistra.

“We need more resources, and we need people in the public to understand that there are good things happening, we just need to figure out how to do it on a scale much different than we are right now,” he said.

Another challenge to overcome is the inability for the public and private sectors to come together on issues such as density.

“We are very good in this region at saying that we innovate and work together, but really the public, private and nonprofit sectors do not dance very well. We have created a very serious dichotomy between private developers and nonprofit developers,” Kooistra said.

In his opinion, the nonprofit advocate community vilifies the private development community, labeling it as the “evil empire,” he continued. On the other side, the private sector tends to look down at accomplishments made by the nonprofit side. Real change will not happen until both sides learn to work better together to reach a common goal, he said.

“We have still not embraced…what it means to live with density and to do density right,” he said.

“We have factions of communities, we have factions of organizations who still believe we can push the urban growth boundaries out as a strategy, and as long as we continue to fight on these issues…I think we will continue to wrestle with how to get through the crisis that we have.”

Michael Maddux, Legislative Assistant and Lead Policy Adviser to Seattle City Councilmember Teresa Mosqueda, spoke to the efforts being made at the state and local levels to improve the affordable housing crisis.

State Sen. Guy Palumbo (D-1) is looking at creating a minimum density bill for transit areas, and Maddux said he looks forward to reading through that language. Earlier this year, the Legislature also passed HB 2382 which allowed utility properties to be sold below fair market value as long as they would go toward affordable housing.

Maddux said the bill  gave the city the motivation to investigate how to handle its housing inventory. It’s original policies were  adopted in 1998, but they lacked clear direction on what to do with those properties except to sell to the highest bidder.

In 2017, then-Mayor Tim Burgess made zoning changes which would require developers to build more affordable housing or pay fees which would be used to create homes for low-income residents in other locations.

This week, the Seattle City Council built on the progress and put forth a resolution which would direct city officials to determine if excess properties could be used for affordable housing or other public uses before making it available to sell. However, the city recognizes the fear that this could only mean these properties would go to affordable housing, added Maddux.

“It essentially says we are going to prioritize housing,” he said, and any excess properties will go into the affordable housing inventory

If those properties are being used toward that end goal, then the city will work with community groups to make sure that local residents’ opinions are heard “to ensure we are getting all the community amenities that are necessary for that community to ensure we are creating thriving communities, not just buildings,” he added.

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A state House work group has held public meetings this year to discuss problems with Washington’s tax structure and potential regulatory changes. While those discussions may lead to recommendations to the House Finance and other committees, legislators should be cautious about any new tax proposals they make, as tax policy is such a key factor in a states’ business climate.

That was one of the takeaways from a Sept. 19 panel at the Association of Washington Business’ 2018 Policy Summit in central Washington. The panel consisted of Tax Foundation Senior Policy Analyst Jared Walczak, state Department of Commerce Managing Director for Business Development Allison Clark and Professor Jeffrey Gramlich at the Washington State University’s Hoops Institute of Taxation Research and Policy.

“There is a lot that Washington has going for it,” Walczak said. “For some it’s very affordable, it’s very attractive.”

That includes aerospace; a study published earlier this year named Washington the best place for design and manufacturing, a fact stakeholders have highlighted as part of an ongoing effort to entice Boeing into building its new airplane in the state.

At the same time, Walczak said he’s “not sure they (businesses) always have that certainty here in Washington” due to frequent tax discussions and debates. “Most of them go nowhere,” but “each of these I think is a concern for businesses. Will my sector be targeted? How do you plan for this level of uncertainty, which doesn’t exist for most states?”

Another drawback for Washington is that one of the few states with a business and occupation (B&O) tax. Created in the 1930s and upheld by the State Supreme Court as a “temporary” revenue source, Walczak says it “is economically inefficient” and creates “lots of incentives to consolidate businesses.”

If Washington wants to improve its tax structure it can create greater “tax neutrality” by broadening the base while keeping rates low, he added. It’s an approach taken by states such as Indiana, Utah and North Carolina.

However, taxes aren’t the only thing employers look at when deciding whether to open shop in a state, he added. The presence of an educated workforce, low cost of doing business and high quality of life are also factored in.

Clark voiced similar observations, noting that a company has a very complex set of variables and criteria they’re looking at” when deciding to relocate or open an office. “When a company is making a decision …they don’t tend to put their stock all in one category.”

One positive change that can be made is greater tax transparency, Gramlich argued. That includes releasing more Board of Tax Appeals decisions to the public.

“We do live in largely a voluntary compliance setting,” he said. “When people don’t know how much the other guy gets, it creates distrust and causes real problems that way. There’s a natural inclination to believe the worst, when in fact it’s probably not.”

While Seattle has positioned itself as the “second Silicon Valley,” Walczak warned it can only take one or two companies leaving to change that. Also, companies are less concerned with closeness to related industry, he added.

“Cities and states need to be competing on this playing field as well” and “look more broadly on how you keep the competitiveness the state has,” he said.

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