HOUSE BILL REPORT

ESHB 2137

As Amended by the Senate

BYHouse Committee on Trade & Economic Development (originally sponsored by Representatives Cantwell, Moyer, Rasmussen and Walk)

Establishing targeted sectors for economic development.

House Committe on Trade & Economic Development

Majority Report:  The substitute bill be substituted therefor and the substitute bill do pass.  (12)

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

House Staff:Charlie Gavigan (786-7340)

Rereferred House Committee on Appropriations

Majority Report:  The substitute bill by Committee on Trade & Economic Development as amended by Committee on Appropriations be substituted therefor and the substitute as amended do pass.  (24)

      Signed by Representatives Locke, Chair; Grant, Vice Chair; H. Sommers, Vice Chair; Silver, Ranking Minority Member; Belcher, Bowman, Braddock, Brekke, Brough, Dorn, Ebersole, Ferguson, Hine, May, McLean, Padden, Peery, Rust, Sayan, Spanel, Sprenkle, Valle, Wang and Wineberry.

House Staff:      Susan Nakagawa (786-7136)

AS PASSED HOUSE MARCH 10, 1989

BACKGROUND:

In the past few years, the legislature has requested studies that in part analyzed how the state could better focus its efforts in identified economic sectors of the state to enhance economic development.

In 1987, the legislature required the Department of Trade and Economic Development to study the market trends and investment opportunities in at least eight key areas of the state economy. This study is expected to be completed by June 1989.

In 1987, the legislature also commissioned a study by the International Trade Assistance Advisory Committee (ITAAC).  This study focuses on improving the trade promotion and assistance programs in the state.  The ITAAC study recommended that the state target areas of its economy where products could be more effectively marketed internationally.

SUMMARY:

The Department of Trade and Economic Development (DTED) is to establish targeted sector programs in the areas of biotechnology and food processing.  These programs are to analyze the current state of the targeted economic sectors and develop a plan to increase the sale of products from these sectors nationally and internationally.  An evaluation process must also be developed to measure the effectiveness of the targeted sector programs.

An advisory committee is to be appointed by the governor for each targeted sector program.  The advisory committee must have seven but not more than 15 members.  The advisory committee shall provide policy direction to DTED on the department's targeted sector programs, including the appraisal of the sector, the development of the program, the implementation of the program, and the evaluation of the program.

The advisory committees include four legislators, representatives of large and small businesses in the sector, and other members appointed by the governor with expertise in the sector and representing various industries and geographic areas.

A targeted sector program staff person is to administer, with guidance from the advisory committee, both targeted sector programs in DTED.  The staff person and the department are also to work with state agencies, local governments, and the private sector.

The Department of Trade and Economic Development is to report in writing each January to the legislature on its targeted sector programs.  The department shall make current information available regularly to the legislature and the private sector on these programs.

EFFECT OF SENATE AMENDMENTS:  The Senate amendment adds manufactured forest products as a third targeted sector.  The targeted sector staff person in the Department of Trade and Economic Development (the department) is removed by the Senate amendment.

The amendment requires the department to contract with the International Marketing Program for Agricultural Commodities and Trade (food processing), the Center for International Trade in Forest Products (wood products manufacturing), and the Nortwest Policy Center (biotechnology) to analyze the current industry and develop an action plan.  The advisory committees established in the bill are replaced by the amendment as follows:  (1) the Department of Agriculture Food Products Processing Advisory Committee will advise the department on the food products targeted sector;  (2) the Evergreen Partnership will advise the department on the forest products manufacturing targeted sectors; and (3) the Washington State Biotechnology Association will advise the department on the biotechnology targeted sector.

The amendment requires the Business Assistance Center (BAC) in the department to review ways to establish an industrial extension grant program and flexible manufacturing networks and report to the legislature.

Finally, the amendment provides for the targeted sector programs to sunset (terminate 1984, repealed 1995).

Fiscal Note:      Requested March 2, 1989.

House Committee ‑ Testified For:    (Trade & Economic Development) Don Lorenz and Jean Cobb, Department of Trade and Economic Development.

(Appropriations) None Presented.

House Committee - Testified Against:      (Trade & Economic Development) None Presented.

(Appropriations) None Presented.

House Committee - Testimony For:    (Trade & Economic Development) Programs that focus on and market specific areas or sectors of the economy can result in more jobs and capital investment.  The coordination and awareness that a targeted sector program can accomplish is especially important in marketing products internationally.

(Appropriations) None Presented.

House Committee - Testimony Against:      (Trade & Economic Development) None Presented.

(Appropriations) None Presented.

VOTE ON FINAL PASSAGE:

      Yeas 93; Excused 5

Excused:    Representatives Basich, Bowman, Hankins, Hargrove and Vekich