HOUSE BILL REPORT

HB 1999

BYRepresentatives Cantwell, Schoon, Hargrove, Rasmussen, Moyer, Walk, Doty, Winsley and P. King 

Establishing the flexible manufacturing network grant program.

House Committe on Trade & Economic Development

Majority Report:  Do pass.  (13)

      Signed by Representatives Cantwell, Chair; Wineberry, Vice Chair; Doty, Ranking Republican Member; G. Fisher, Kremen, Moyer, Rasmussen, Raiter, Rector, Schoon, Tate, Walk and Youngsman.

House Staff:Bill Lynch (786-7092)

AS REPORTED BY COMMITTEE ON TRADE & ECONOMIC DEVELOPMENT

FEBRUARY 15, 1989

BACKGROUND:

Some states have established programs that encourage small businesses to pool their resources in order to become more competitive.  These cooperative systems, or flexible manufacturing networks, enable these small businesses to add additional value to their products, access new markets, increase wages, and modernize.

Flexible manufacturing networks are formed by identifying clusters of related firms in an industry, assessing their capabilities, and identifying opportunities for the companies to work together.

A study is currently being conducted on the potential of flexible manufacturing networks in the state. It is suggested that a pilot program to test the viability of a flexibility manufacturing network would encourage businesses to initiate such partnerships.

SUMMARY:

A flexible manufacturing network grant program is established within the Business Assistance Center of the Department of Trade and Economic Development.  Grants must be awarded on a competitive basis.

An application for a grant must include a description of the applicant's plan to screen businesses within an industry subsector and establish a network to take advantage of joint efforts in marketing, training, product development, manufacturing, or related activities.

An applicant for a grant must also describe the process that will be used to recruit and train brokers to establish the communications link among the firms and identify network opportunities.  The applicant must also identify how existing programs can be used to promote flexible manufacturing networks.

The Business Assistance Center must report results of the program to the Legislature by December 31, 1990.

Appropriation:    $100,000 from the state general fund to the Department of Trade and Economic Development.

Fiscal Note:      Not Requested.

House Committee ‑ Testified For:    Doug Race, Manufacturer's Representative; David Harrison, Northwest Policy Center; Bill Warner, former Assistant Director of the Small Business Administration; and David Dougherty, Director, Business Assistance Center.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    It is a program that will remain private sector driven.  It will allow companies to produce products they could not make alone.  It allows for cost efficiencies.  It will create an opportunity to add value to products, particularly in wood products, food processing, plastics, and metal industries.

House Committee - Testimony Against:      None Presented.