Business Matters

A ten-part series on resolving Washington's anti-business climate

"We will do everything in our power to guarantee a thriving, environmentally-sustainable business climate." – Governor Gary Locke –

Part 7: Time to grow beyond GMA

Since 1990, Washington state has restricted its land use as a result of the Growth Management Act (GMA). In that same time, however, there has been an increase of 1.4 million residents in the state. Though GMA originally sought to provide a framework for counties and cities to plan for the needs of an increasing population, in attempts to improve community business climates it has instead evolved into a major hindrance, especially for rural counties.

GMA was intended to provide the framework for a bottom-up approach to managing growth. It was packaged and sold to counties with an emphasis on local grassroots involvement, not statewide planning. This local control ended in 1991 when GMA was revised to include the disastrous Hearings Boards (three quasi-judicial bodies with authority to decide the outcome of challenges to local comprehensive land-use plans and regulations). The unelected members on these boards have become the fourth branch of state government, invalidating years of work by local planning commissioners and throwing large portions of counties into a state of disarray by declaring their plans and regulations to be non-compliant or invalid.

An invalidity or non-compliance ruling is the final nail in the coffin of a county’s business community. For example, when a county’s growth boundaries (the area in which new growth is allowed to occur) are declared non-compliant, businesses on the wrong side of the growth line are subject to onerous restrictions that may make it impossible to remain in operation.

Further development is severely restricted, which may prevent the business from ever expanding beyond its original physical structure. Should the business need to relocate due to building restrictions, it is allowed to sell its property, but the property may only be used by a business that provides the same services. Non-compliant buildings may not change uses. Once ruled non-compliant, if the building was used to make sewing machines, only another sewing machine company may occupy the building. In addition, if a building goes unused for long enough (perhaps in the case of a former business that was unable to lease or sell the building to a comparable business), it may not be utilized for a non-compliant purpose.

Remember, all it takes for a growth boundary to be declared non-compliant is the opinion and ruling of an unelected Hearings Board, which has the power to override county elected officials and planning commissions throughout the state. This system of governance does not inspire much faith in the hearts and minds of prospective business owners considering residence and operation in our state.

While the punishment of businesses is egregious enough, GMA goes a step further to inflict damage on the livelihood of counties that fail to comply. Under state law provision RCW 36.70A.345, the governor is authorized, with consultation of the Hearings Boards, to impose sanctions upon counties.

The governor may impose a sanction or sanctions specified under RCW 36.70A.340 on . . . (4) a county or city that fails to adopt its comprehensive plan or development regulations when such actions are required to be taken.

These sanctions are spelled out in RCW 36.70A.340:

. . . the governor may either: (1) Notify and direct the director of the office of financial management to revise allotments in appropriate levels; (2) Notify and direct the state treasurer to withhold the portion of revenues to which the county or city is entitled . . . (3) File a notice of noncompliance with the secretary of state and the county or city, which shall temporarily rescind the county or city’s authority to collect the real estate excise tax . . . until the governor files a notice rescinding the notice of noncompliance.

Therefore, under GMA, if a county or city is ruled non-compliant, the whole local government can be starved of state revenue.

One of the most striking examples of how GMA has damaged the business community in Washington comes out of Lewis County. When the Packwood mill was shut down, the city of Packwood hoped to turn the area around the old mill area into a business park. As plans for the park progressed, negotiations began with what would have been the county’s first electronics assembly corporation. These negotiations were running smoothly until the dictatorial Hearings Board re-drew the surrounding growth boundary, leaving the Business Park outside the line of compliance. As a result, the electronics firm located elsewhere (taking its jobs with it), and the only business that can utilize the old mill area is another mill business. Thanks to the Hearings Board decision, Packwood was unable to capitalize on the high paying jobs that the company would have brought to the economically depressed area.

In order to revive Washington’s weakened economy, especially in rural counties, four immediate revisions to GMA must be made:

1. The unelected Hearings Boards must be abolished, allowing GMA to empower local officials to determine the best type of growth for their communities as it was originally intended to do.
2. Counties and cities should be given greater freedom to plan for local growth needs. Instead of facing sanctions, local officials should have the power to be accountable to their electorate and not be held captive by unelected bureaucrats.
3. Common sense economic development should be made a mandatory element of any growth management plan.
4. All plans for growth should adopt market-driven principles. When market forces are allowed to determine how and where businesses should exist, community health is not artificially determined by the "good intentions" of lawmakers from other parts of the state. Local officials are best suited to determine what is in the economic interest of their communities, and they should be empowered to make growth decisions.

With our economy and budget floundering, now is the time for growth. If we continue to insist that businesses and communities seeking to create and attract new jobs for citizens jump through ever-changing hurdles, economic recovery will never materialize. It’s time to get out of the way and let the free market do what it does best: create new jobs and empower citizens to make individual choices.

This is part seven in a ten-part series on resolving Washington’s anti-business climate.

Intro | Part 1 | Part 2 | Part 3 | Part 4 | Part 5 | Part 6 | Part 8 | Part 9 | Part 10

Contact: Jason Mercier, Deputy Communications Director, (360) 956-3482 or jmercier@effwa.org.

Evergreen Freedom Foundation P.O. Box 552, Olympia, WA 98507 Phone: (360) 956-3482, Fax: (360) 352-1874 Email: effwa@effwa.org