Senator Lorraine Wojahn

Commission here in Tacoma. We only had
three, but it didn’t work; we needed additional
heads. We added two more members. What
were some of the other economic development
issues? That was a real study and we really
worked that.
Ms. Kilgannon: Was there something about
better freeway connections? You mentioned
something about the need for downtown hotels
in Tacoma.
Sen. Wojahn: Yes, that was Tacoma. We
finally got some. And convention centers. We
were able to give tax exemptions or a portion of
the sales tax could be used for convention
centers. Also, since then, we have done some
things which authorized a removal of the
property tax on the buildings above the property
to be remodeled. That is later, though,
maintaining the overall property tax on the
property itself, the real property. We separated
the two. Also, we couldn’t get tax increment
financing, which is unconstitutional. We would
have had to do a constitutional change, because
it is a method which amounts to a lending of the
state’s credit, which we can’t constitutionally
do. So, we got around that by calling it
“economic development” or historic
preservation, which let us get around some of
these taxing problems where we could not use
the state’s credit.
Ms. Kilgannon: Is that like an enterprise zone
situation?
Sen. Wojahn: Yes, I think it is the same
principle. I don’t know anything about
enterprise zones, but by calling it economic
development, we could get around a
constitutional amendment and by authorizing
certain old buildings as having historic tax
credits, we could sell those tax credits on a
public building to private industry for money.
Ms. Kilgannon: So, it would help subsidize
them?
Sen. Wojahn: We have done that; an economic
development package came out of that. For
instance, the Sprague Building in Tacoma, we
were able to sell two million dollars worth of
211
tax credits to Pierce County Medical Bureau, so
that the money from Pierce County Medical
could be used by the Sprague Building for
construction.
Ms. Kilgannon: For restoration?
Sen. Wojahn: For gutting the inside of the
building, but maintaining the exterior. Anything
for economic development we could get around
the Constitution.
Ms. Kilgannon: Because everything has to be
taxed equally, otherwise, right? So this was a
way of kind of excusing some of the taxes?
Sen. Wojahn: Well, it is the loaning of the
credit by the state. That is what it is.
Ms. Kilgannon: Can you tell me more about
this committee, who was on it?
Sen. Wojahn: It was started by Bill Wilkinson;
he was one of the principals. He is an attorney
in Tacoma, but the committee was established,
as I remember, by the House of Representatives
Commerce Committee to study economic
development and to develop a method to use tax
credits to enhance areas of the state.
Ms. Kilgannon: So, did you work all over the
state?
Sen. Wojahn: Yes, we held meetings all over
the state.
Ms. Kilgannon: This must have been a
tremendous learning experience!
Sen. Wojahn: It was really good. Then, I went
to the Senate the next year. Frank Warnke had
become chair of the Commerce Committee after
me and he was the one establishing an
Economic Development Committee. And he got
some outside appointees to it. It was a limited
statutory committee. And all the members of
Commerce were on the committee, but also we
had an outside executive officer. And then we
invited developers and entrepreneurs to talk to
us about what we could do, and from that, came
these bills. And I carried that; I carried the
sunset bill into the Senate and also, the
definition of economic development, which we
got, and also, the Foreign Trade Zone, which we
got.