Economy key as session opens

Walla Walla-area lawmakers will have commerce on their minds as the Legislature opens a 60-day session today.

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In the Walla Walla Valley and the surrounding region, the stability of local commerce becomes even more important during the holiday season. But it takes more than the recently wrapped up two months of festive shopping and gift-giving to create a solid business climate that will support thousands of people.

In the last couple of years, the recession took its toll on area residents. However, three local politicians representing Washington's 16th District -- state Sen. Mike Hewitt, and state Reps. Terry Nealey and Maureen Walsh -- see reason to be optimistic about the Valley's financial climate.

Walsh, in addition to working as a legislator, is also a small business owner who has struggled in the recession. To assist employers in hiring workers, Walsh is floating an idea to introduce an incremental business and occupation tax for start-up businesses until the companies have fully established themselves in their fifth year.

"New businesses that fail contribute nothing to the state, so assistance with reinvesting into the business in the first years could help them survive," Walsh said.

Walsh is also considering a change in the policy that subsidizes day-care costs for employees in the WorkFirst program.

"I would prefer to see a program, perhaps a pilot program where folks obtain a job through the Worksource Center, work four out of five days and then work a day in the child-care venue on the fifth day," she said. "That gets folks working but the extra benefit is that the parents also learn how to be better parents by gaining parenting skills at the day care."

Nealey is a lifelong resident of Eastern Washington and like Walsh is passionate about helping businesses in the region. When asked his opinion of the economic recovery in the Walla Walla region, Nealy expressed a sense of cautious confidence.

"We're going to get there. We have a strong agricultural base, the wine industry, governmental jobs in the schools and Corps of Engineers," Nealey said. "But I don't think we're going to come out quickly; there will be some layoffs that will slow down the comeback."

There are a variety of ways to affect small town economies and legislation is just one.

Ballot Initiative 937, which passed with 52 percent of the vote in 2006, requires utility companies with more than 25,000 customers to obtain at least 15 percent of their energy from renewable energy sources by the year 2020. The issue is crucial for business in the 16th District, according to Nealey, who also explained the importance of reforming other resource concerns.

"Energy is critical because we have enjoyed the cheapest electric rates because of our inexpensive hydro power," Nealey said. "The other area to revise or reform is our water policy, because if we can get more water for more irrigation to assist agriculture that will give our economy a big boost.

"It would be good to have flexibility in issuing water rights," he continued, "And on a timelier basis instead of waiting years and years like some people do now."

Nealey also explained how the job of a state representative or a state senator hinges not only on the legislation you pass, but the legislation you work hard to keep from passing.

"I'm not here to just pass bills," he exclaimed, "But to fix budgets, help businesses where I can, and help defeat bad legislation. We need to look at reforms and not increasing taxes.

"We've got to live within our means and improve state government by making it leaner," Nealey asserted.

Cutting nearly one-fourth from the state's $2 billion budget deficit, as the legislators voted on in December, is a good step toward fiscal responsibility and could reap benefits for the business climate in the 16th District. But such steep cuts tend to affect people in a drastic way.

Nealey shared his concerns and said he would do all he could to see that such cutbacks would cause "the least damage to the vital services. I want to protect the schools as much as we can and protect the very vulnerable.

"It's a fine line," he continued, "when jobs are lost due to cutbacks, as it can affect the community."

Despite working in Olympia much of the time, legislators are very much a part of those affected small communities.

Hewitt's wife, Cory, manages the Walla Walla County fairgrounds, and Hewitt was a small business owner for 23 years and the former chairman of the Walla Walla Planning Commission. Currently, he is the Senate Republican leader of the Washington State Legislature and represents the 16th District in the upper chamber. Hewitt asserted the mixed blessings that come with having such a diverse economy like those in Franklin, Benton, and Walla Walla counties.

"The unemployment rate (in Walla Walla County) is fairly low -- 6.5 percent," Hewitt stated. "It's fairly stable because of the agriculture, the Corps of Engineers, two hospitals, three colleges, and the new tourism thing is working out very well -- it might not produce the highest paying jobs, but tourism has helped the Valley a lot.

"We have such a stable base," Hewitt exclaimed. "It's a very diverse economy compared to some counties. As long as we can keep that diversity I believe our economy will remain fairly healthy. Commodities are up and being agriculturally based is very good for the community."

Yet according to the Senate minority leader, the financial climate for the Walla Walla region may have a few storm clouds on the horizon.

"We lag the national economy by about 18 months. I've seen numbers from economists and (the unemployment rate) could go up if things get worse," Hewitt predicted.

Hewitt and many others will be hoping that business in the 16th District will learn from national trends and avoid an increase in unemployment. Hewitt expressed his primary purpose as a legislator "is to make the economy strong or even better, to focus on growing the economy. It's easier to retain jobs than to create new jobs."

Hewitt pinpointed two specific pieces of legislation that have the potential to be significant game changers for small business -- unemployment compensation and workers' compensation.

Despite resistance from labor unions and the state House, bipartisanship prevailed in the Senate and legislators passed a major structural reform, which Hewitt claims will "save billions of dollars" in workers' compensation because "employees now have the ability to settle a claim instead of just stay on the pension system."

Walsh explained that state legislators, like those in the 16th District "want to be compassionate toward the folks who are truly in need," but "we need to change an attitude of enabling to a more constructive and productive attitude of empowering."

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