'We did all we could' to keep 787 work, Gregoire says, but GOP disagrees

Republicans quickly blamed Democrats Wednesday for failing to prevent Boeing from deciding to build a second 787 final-assembly plant in South Carolina.

But Gov. Chris Gregoire said nobody was at fault, and that Boeing told her there was nothing the state could have done. "We did all we could," Gregoire said at a hastily called news conference after the Boeing announcement.

The governor said Jim Albaugh, president and CEO of Boeing Commercial Airplanes, "specifically said it's not about workers' compensation and it's not about state taxes. It's about the cost of salaries and benefits to the workers we have in Everett versus what we can pay in Charleston. And it's about having work stoppages that would be hard for their clients."

Gregoire said her office and the state's congressional delegation worked hard to keep the second line in Washington state.

Several members of the delegation warned Boeing that moving jetliner assembly out of the Puget Sound area would be a gamble.

U.S. Sen. Maria Cantwell, D-Wash., repeatedly urged Boeing CEO Jim McNerney to weigh the Seattle area's aerospace expertise against the risk of starting a production line from scratch, said John Diamond, Cantwell's spokesman.

George Behan, spokesman for U.S. Rep. Norm Dicks, D-Bremerton, said the delegation's biggest leverage with Boeing was its long-standing support of the company.

"But this is a company now run by an external board, and this decision is about bigger issues, presumably," Behan said.

GOP: Not enough effort

Republicans argued that state Democratic leaders should have held a special legislative session this year to come up with a package of incentives to help persuade Boeing to keep the second 787 line in Washington.

South Carolina this week offered the company $170 million in grants for startup costs, plus tax breaks worth millions more.

"We could have looked at more tax incentives. We could have fixed workers' comp for them. I think those are clearly good messages to send to someone like Boeing when we're in this kind of situation," said state Senate Republican Leader Mike Hewitt, R-Walla Walla.

Boeing and the business community want the Legislature to make changes in the workers'-compensation system that would lower costs for companies.

Hewitt said the state has been sending the wrong message to the company, noting that Gregoire visited the picket line during the Machinists union strike against Boeing last year.

"What do you think that tells Boeing?" Hewitt asked. "Do you think they think she cares about them?"

Incentives were in place

Gregoire said the state already has aerospace incentives on the table worth about $3 billion over 20 years that were approved by the Legislature in 2003.

She said she urged the Machinists union to remain at the negotiating table with Boeing but did not push them in any direction in terms of a decision.

State Rep. Hans Dunshee, D-Snohomish, said he doesn't think there's anything the state could have done. "I think they were going there from Day One."

Gregoire said the decision regarding the 787 needs to be considered separately from the other Boeing production lines and that the state will work hard to make sure more business doesn't leave the state.

She noted that Boeing wants to work on workers'-compensation issues during the next legislative session. "We cannot soften our resolve to stay as good as we can be, in order to be ready for all competition to come in the future."

Andrew Garber: 360-236-8266 or agarber@seattletimes.com.