Cascadia Report

Category: Business

  • National newspaper expands in B.C.

    British Columbia’s booming economy and population has convinced the national Globe and Mail to expand its presence in the region.

    Since launching a B.C. section of the paper in 2005, circulation in the province reportedly is up 8 percent on weekdays and 7 percent on weekends. The Toronto paper now has 13 journalists in Vancouver (up from two 20 years ago) and recently elevated the title of the new head of its B.C. office to editor from bureau chief. (Note: B.C. headlines from the Globe and Mail run on the left sidebar of this page.)

  • Dirty water costing Vancouver businesses

    Dirty water flowing through Vancouver’s taps in the aftermath of recent flooding is likely costing the local economy millions of dollars, according to David Park, chief economist for the Vancouver Board of Trade.

    The area has been getting back to normal since last weekend, though some residents and businesses still had to boil tapwater. The overall impact is likely to be small given Greater Vancouver’s overall gross domestic product of about $90 billion, Park said.

  • Seattle newspaper latest target in cross-border deals

    A once-thriving suburban Seattle newspaper has been sold to a Victoria publisher, in the region’s latest cross-border corporate deal.

    B.C. company buys Seattle newspaper, image by PBS.orgBlack Press, owner dozens of papers in British Columbia and Washington, acquired the daily King County Journal, which has a modern printing plant and circulates east and south of Seattle. The paper once dominated the suburbs but has lost at least half of its readership since the early 1990s thanks to hazy focus on the market, cost-cutting and an unambitious Internet presence. Black Press’ plans aren’t clear, but surely the new owner won’t continue the status quo. Deep cuts were announced when it bought a paper in Akron, Ohio.

    The deal widens Black Press’ reach thruough the region. Similar past regional deals include Interfor’s acquisition last year of timberlands and mills in Washington and Oregon, Cray’s purchase of B.C. computer firm OctigaBay in 2004 and Weyerhaeuser’s takeover of MacMillan Bloedel in 1999.

  • Tacoma port sees continued boom

    The Port of Tacoma approved a new budget that anticipates continued growth in 2007 and doesn’t increase taxes.

    Rising property values and new construction mean the port generates more money from the same tax rate, which reportedly has remained the same for nearly a decade. Profit should rise 28 percent, partly thanks to the port’s booming traffic.

    Soaring land values also bailed out the Port of Seattle. It forecast increased revenues from higher property assessments and kept its higher levy rate basically unchanged. Traffic through Seattle, though, has been declining.

  • Washington’s renewable-energy law sparks enthusiasm

    Washington’s new requirement that utilities generate more renewable energy is supposed to spell doom for the state’s economy. But someone forgot to tell a business group in Seattle.

    About 60 venture capitalists, private investors and financial-industry types could barely conceal their enthusiasm during a forum last week on investment opportunities in the biofuel industry. The idea is that voter approval of I-937, which requires utilities to generate 15 percent of their energy from non-hydro renewable energy by 2020, is a potential jobs goldmine for the state.

    “This could make Washington a leader,” said John Plaza, president of Imperium Renewables, which recently started building a plant in Aberdeen. Each dollar of investment in biofuel technology stimulates about $2.50 in add-on benefit, he said.

    Those predictions are in stark contrast to the doom prophesized by opponents of the renewable-energy law. The Association of Washington Business said the measure would raise power bills by up to $370 million a year and cost up to 7,100 jobs.

    Presenters at the forum at law firm Preston, Gates claimed opportunities include technology to reduce energy consumption, improve the efficiency of the region’s electrical grid and generate energy from plants such as wheat, soy and algae. One representative of a major regional utility said his company plans substantial investment in the new technology.

    Risks of the new mandata include instability of the tax system, falling oil prices and difficulty siting new plants, participants said. But the law should create incentives to solve some of those problems. For example, Seattle City Light adopted a zero-emissions policy in 2004 and helped create a carbon market in the state, said K.C. Goldon, policy director of Climate Solutions, the nonprofit that sponsored the forum. The utility’s move directly led to development of the first biodiesel plant here, he said.

  • B.C. plans to lure foreign grads to fill job gap

    British Columbia plans to lure more foreign students and encourage them to stay to fill the province’s employment gap.

    About a million new jobs are forecast over the next decade, while only about 650,000 people are expected to graduate from the province’s high schools, according to the Vancouver Sun. The province wants the national government to let graduates from abroad stay in the hope that they will help build trade, investment and cultural links with their native countries, helping make B.C. North America’s “Asia-Pacific gateway.”

    Immigrants are behind one in five U.S. startups (and about 40 percent of tech startups), according to a study last week by the National Venture Capital Association. Post-Sept. 11 rules have made it more difficult to enter the U.S. and there is vocal opposition to allowing more people with technical skills.

    Meanwhile, Vancouver already has one of the world’s highest rates of foreign-born population, according to a survey in The Economist. Current rules allow graduates to work for a year in Vancouver or two years in the rest of B.C. after school. Plans call for extending that to two years for the entire province.

  • Industrial land may need saving next

    Metropolitan sprawl and public attitudes are bottlenecks for the region’s ports, according to speaker after speaker at a conference on the region’s economy last Friday in Whistler, B.C.

    In Vancouver, housing development is spreading over formerly open land outside the city, devouring space for port-related and industrial use and making it harder to develop transportation infrastructure. Highway 1, the main arterial to eastern Canada, is frequently clogged and comes nowhere near the ports, yet there’s plenty of opposition to plans to connect them.

    Vancouver Port CEO Gordon Houston said the Vancouver area may need to set aside “industrial land reserves” similar to conservation areas designed to protect wilderness. He called for tax changes to take away the incentive to build housing on open land. Seattle’s port has tried to deal with a lack of space by siting distribution centers far from the waterfront.

    A bigger problem is a lack of appreciation of the importance of the ports to the region’s economy, according to most speakers at the Pacific Northwest Economic Region conference. An official of the Dutch consulate claimed that residents of Rotterdam, Europe’s biggest port, are actually proud of their 600-year-old trading history. By contrast, in Washington, trade is said to account for one in five jobs but most residents don’t see the connection.

    The ports themselves need to build support. Larry Ehl, an official of the Washington Dept. of Transportation, said they should cooperate with conservation groups on new projects rather than trying to resolve protests later. They should make the case, for example, that railroad-expansion projects could take pollution-causing trucks off the road.

    Houston said he deals with 17 municipalities who border Vancouver port facilities. “The sentiment ranges from ‘Let’s work together and move forward’ to ‘When are you picking up and leaving — the sooner the better.’ That has to change.”

  • Why a major investor is betting on lumber

    News that housing starts in the U.S. fell 15 percent last month is just latest blow against the region’s lumber companies. So why is one of the world’s richest men doubling-up his investment in British Columbia’s largest lumber firm?

    The weekend Globe and Mail has an excellent overview of the challenges and prospects facing Canada’s big producers. It explains that billionaire Jim Patterson, who now owns a quarter of Canfor, likely sees opportunities to consolidate the industry. (The nine biggest Canadian firms have a market value of C$11 billion, $6 billion less than Weyerhaeuser alone, the article says.)

    Profits have been killed by slumping demand along with higher costs for energy a rising Canadian dollar. The theory is that the crisis could force Canada’s politics to allow large-scale consolidation for the first time.

  • Vancouver recovering from water crisis

    The Vancouver area was starting to recover Saturday from a crisis that threatened the city’s lifestyle and an entire industry: a lack of coffee. A letter in the Vancouver Sun called it the worst day in the city’s history.

    About two million people were warned to boil their drinking water, after brown, murky water began flowing from the city’s taps following last week’s storms. The warning meant the city’s coffee shops couldn’t brew coffee drinks. Crisis peaked when a fight broke out at a Costco over a shortage of bottled water.

    Apparently the dirty water was caused by extreme rainfall that flooded the city’s supply, which isn’t thoroughly treated. Many Vancouverites blamed the city’s decision years ago to allow logging inside its watershed.

  • Olympics preparations hit turning point

    Organizers of the 2010 Olympics Thursday unveiled the first venue that’s ready for competition, even as preparations continued for the border security to handle an expected games-related business boom.

    Near Vancouver, the slopes for the freestyle skiing venue at Cypress Mountain are ready several months ahead of schedule, according to the organizing committee. The news is a turning point for the games, though construction on structures at the site continues and overall preparations are far from complete.

    It also underscores the need for infrastructure to handle increased traffic around the region leading up to the event. This week, Washington Gov. Chris Gregoire asked the U.S. Homeland Security department to try an altenative to requiring passports to cross the international border. Instead of current plans to require passports starting in 2009, she proposed testing handheld drivers-license scanners that would read security bar codes. Gregoire and B.C. Premier Gordon Campbell have stepped up contacts to address hurdles such as the border crossing.