I-1098 defeat a boon to business
Telemark will move to B.G.; Camas still in running for Fisher HQ
Thursday, November 4, 2010
Camas is still in the running as a potential headquarters for Fisher Investments, and Hayward, Calif.-based Telemark will follow through on plans to move its headquarters to Battle Ground, following the defeat Tuesday of Washington’s ballot Initiative 1098.
The measure, which would have introduced a state income tax on those making more than $200,000 per year to pay for education and health care programs, failed with about 65 percent of voters opposed and 35 percent in favor. But while Clark County businesses are celebrating the election results, educators are concerned that voters’ recent assault on new taxes means the state won’t be able to fulfill its constitutional obligations.
Several out-of-state businesses had hinged their plans for Clark County on the outcome of the election. The defeat of I-1098 clears the way for those businesses that had put expansions on hold, including Fisher Investments and Telemark, to commit to relocating here.
“We’re very happy with the results, to have it go down with a large majority like that,” said Brent Erickson, executive director of the Camas-Washougal Chamber of Commerce, which campaigned against the measure. “For any economic development organizations and businesses that want to come to Clark County, it makes it easier for them (to move here). They won’t shy away and consider other states.”
San Francisco-based Fisher Investments in October oversaw the groundbreaking of its new $30 million office complex in Camas, where it employs 325 workers. The company is also considering moving its entire headquarters to Washington — but it would have nixed that possibility if I-1098 had passed, according to President Ken Fisher. Clark County is now still in the running with income-tax-free states Texas and Florida for the business.
Telemark definitely plans to move its headquarters to Battle Ground, bringing 40 jobs to the area, following the defeat of I-1098. The company had already moved 18 of its employees to its new offices at the Battle Ground Corporate Center, but owner Gary Henderson had delayed a decision on the full move until the results of the election were in.
Because Telemark is an S corporation, all of its profits are counted as income on Henderson’s personal income taxes. Passage of the measure would have meant a big loss for his business, he said.
“I have to give the people of Washington credit for their good judgment,” said Henderson, who immediately called his real estate agent in Washington on Wednesday morning. He has resumed house hunting here, he said.
Not everyone is celebrating the defeat, however. The Washington League of Education Voters says that the defeat of I-1098, in combination with the passage of other anti-tax measures, means it will be difficult for the state to meet its constitutional duty to fund basic education.
Voters passed Initiative 1107 to repeal higher taxes on pop, candy, gum, bottled water and certain processed foods. Initiative 1053 also passed, requiring the Legislature to get a two-thirds majority on tax-hike votes, rather than the simple majority required for most legislation.
No immediate effects of the I-1098 defeat will be felt, because it wouldn’t have produced revenue for the next biennium, said George Scarola, legislative director for the League of Education Voters. But over the long term, it could contribute to a constitutional crisis for the state, he said.
“We’re left with a growing deficit, less revenue and no opportunity to increase fees or revenue,” Scarola said. “Something has to give.”