Boeing: Machinists deal and legislative package both needed for 777X deal

Boeing says a deal with its Machinists Union and a legislative package must both be approved in order for the company to guarantee work on the new 777X will remain in the Puget Sound area.

The company reiterated that Wednesday in a letter to Governor Jay Inslee signed by Ray Connor, President and CEO of Boeing Commercial Airplanes:

Pursuant to our discussions this week, Boeing is committed to placing 777X final assembly and wing fabrication in the Puget Sound region. This commitment, however, will be solidified if the International Association of Machinists and Aerospace Workers (IAM) District 751 contract proposal is ratified in a vote by the membership next week and favorable economic incentives are implemented by the State of Washington.

That contradicts a letter of understanding obtained by The Seattle Times between the union and Boeing, which says the company “agrees to locate the 777X wing fabrication and assembly, and final assembly of the 777X in Puget Sound,” if members ratify the deal. There is no mention of a requirement for passage of the legislative package.

But in a statement late Wednesday, the union made clear it doesn’t believe legislative action is not required for Boeing to guarantee the 777X work.

“District 751 Legislative Director Larry Brown is leading a 10-member delegation to Olympia tomorrow to personally lobby legislators to support the Governor’s package of 777X proposals, including the transportation plan.

“Any suggestion that the union thinks Legislative action isn’t necessary is simply wrong.”

The union deal would extend a labor contract between the union and Boeing through 2024. Members would receive a $10,000 signing bonus for ratification. But they would face increased health care costs and significant changes to their pension.

The legislative package announced Tuesday by Governor Inslee would include tax breaks and other incentives along with passage of a transportation package.

But despite Inslee’s call for passage in the next week, a leading lawmaker says transportation funding will not be settled in the special session, which begins Thursday.

“I don’t expect anything over the weekend on that,” Senate Coalition Caucus co-chair Rodney Tom, D-Bellevue, tells KIRO Radio. He agreed that any transportation funding package will likely include a gas tax increase. “We’re still working through what kind of increase that would be,” Tom said.

Inslee said the transportation funding plan is valued at about $10 billion, close to the same dollar value of the funding bill approved in the House last session. But Tom said the details of a newly-negotiated bill are still in question. He says crafting transportation funding that voters can approve will take more time.

Boeing refused requests for comment. The Senate Ways and Means committee has scheduled a hearing on the package Thursday at 1:30 p.m.

KIRO Radio’s Tim Haeck contributed to this report