Federal spending has driven the local economy for decades, driving local leaders to pursue private development to reduce the area’s dependence on federal dollars.
Federal paychecks at Hanford still account for an estimated 30 percent of the community’s income, but the top business stories of 2016 show a healthy amount of private investment in non-Hanford activities.
Here’s a look at the top Tri-City business stories of the year.
AutoZone chooses Pasco
Memphis-based AutoZone chose Pasco’s King City truck stop area for its new 443,819-square-foot warehouse. AutoZone was heavily recruited by local and state economic development agencies and was so critical that it had its own secret code name: Project Sunrise. When it opens in 2017, it will contribute 200 jobs to the Tri-City economy and much-needed tax revenue to Pasco and Franklin County. The state contributed nearly $3 million in tax breaks to recruit AutoZone, a Fortune 500 company.
Carbitex lands Bay Area investors
Carbitex, a Kennewick-based flexible carbon fiber tech firm helmed by Junus Khan, raised $3 million in equity financing with Paxion Capital Partners of Menlo Park, Calif., and Westlake International of San Mateo, Calif. The deal is a vanishingly rare example of Bay Area equity being invested in the Mid Columbia. Khan disclosed the investment in a meeting with Gov. Jay Inslee, telling him the money will help the company grow to 30 employees.
ConAgra expands Richland fry line
ConAgra invested $200 million to add a new French fry line at its Lamb Weston processing center in Richland. The new line will add 128 jobs. The move came shortly before ConAgra spun Lamb Weston off as an independent, publicly traded company with nearly $3 billion in sales. The new company is based in the Boise area, but it employs 4,000 in the Mid-Columbia and is a critical customer for Washington-grown potatoes.
Hot housing market
The Tri-City residential market was nothing short of amazing in 2016. Benton and Franklin counties were two of the five counties in Washington to report annual price increases of 20 percent or more. In-migration and job growth kept demand ahead of the market’s ability to deliver. The median local home price stood at $225,000, according to the most recent quarterly report from the Runstad Center for Real Estate Studies at the University of Washington.
Tri-Cities Airport expansion.
Air travelers ran the gauntlet of construction crews throughout the year at the Tri-Cities Airport, which underwent a $41.9 million update and expansion that will double the size of the area’s largest airport. The space, which debuts this month, is needed. The Port of Pasco reported 339,306 boardings for the year through November, eight percent ahead of 2015, which was a record year.
Energy Secretary drops by PNNL
National media seemed mesmerized by the U.S. Secretary of Energy’s wavy gray locks during the State of the Union, but Ernest Moniz, the Stanford-educated MIT professor, was all business when he dropped by the Pacific Northwest National Laboratory in August. Munoz came to learn more about the amazing energy work transpiring at the lab, and to drop some news: The Department of Energy renewed the Battelle Memorial Institute’s contract to oversee the lab for five years.
Battelle has operated the lab since it opened in 1965. Its proposed annual fee for operating the lab remains unchanged at approximately $12.5 million.
The Tri-City economy consistently added new jobs since March 2013.
The growth streak entered its fourth year in 2016 and would be even longer except for stimulus-related spending that caused a spike and then decline in jobs at Hanford. The growth streak put the Tri-Cities in the spotlight. In November, it was the third fastest job growth area in the state. As the year comes to an end, Hanford employment is up 900 jobs and the economy is poised to enter its fifth year of growth next March.
‘Listeria’ link shutters CRF Frozen Foods
CRF Frozen Foods in Pasco recalled nearly 360 products in April after nine people in four states were sickened after eating CRF products contaminated by Listeria monocytogenes, a common pathogen. Three people died. Listeriosis was considered the cause of death for one person in Connecticut. The recall shuttered the plant so the source could be identified and the plant re-sanitized before restarting.
The federal Centers for Disease Control and Prevention concluded its investigation in July, but the expected restart has yet to occur.
Retter drops Windermere for Sotheby’s
Dave Retter formed Windermere Real Estate Tri-Cities in 1993. In 2016, he decided to shake things up and switched his affiliation to Sotheby’s, a move that puts it on the radar of a global concern. The change, which did not affect the separate Windermere Real Estate Group One/Tri-Cities, brought a new name to the former Windermere Theater at Toyota Center Arena: Retter & Company Theater. He announced the change to the company’s 85 residential and commercial agents as well as staff in November.
Public and private entities invested big in supporting the region’s celebrated wine industry. Here’s a small sample of what’s being done to facilitate wine making in the Mid-Columbia.
- West Richland debuted a $3.1 million plant that pre-treats wine effluent before it hits the municipal treatment system, an investment that supports up to 2.5 million cases of wine production annually.
- At Wallula, Railex Wine Services is spending $10 million on the second phase of its massive wine storage and distribution center at the Port of Walla Walla, driven largely by Ste. Michele Wine Estates, its primary customer.
- The Port of Kennewick hired Banlin Construction to construct its Columbia Gardens Wine and Artisan Village project at 421 E. Columbia Drive. In December, it selected Palencia Wine Co. of Walla Walla and Bartholomew Winery of Seattle as tenants. The small wineries both will make Kennewick their production headquarters.
- The Port of Benton blessed plans to construct two three-bay projects aimed at tasting room tenants, one in Prosser and one in Richland.
Retail hits and misses
On the retail front, HomeGoods opened at Columbia Center and Ross Dress For Less expanded to Richland’s Queensgate area, as did Ulta Beauty.
Last spring, the Tri-City Herald revived an old tradition and surveyed readers about the businesses they want to see come to town. Trader Joe’s, Nordstrom and Cheesecake Factory topped the list. While none of those companies showed an interest in setting up shop in the near future, one oft-mentioned service company did make it.
Several dozen readers mentioned that they wanted to see San Francisco-based Uber establish its app-based taxi service here. Uber launched service in much of the Tri-Cities on Dec. 15 after local governments began adapting taxi codes to accommodate the internet-based system. Pasco is the only municipality left, and it will review its ordinances in January.