Study looks at Boeing's impact
A new study seeks to quantify the boost that Boeing Co.'s 787 factory will give to the local and state economy. And the resulting numbers are enormous.
Once fully operational, the manufacturing plant at Charleston International Airport could release $5.9 billion each year into the South Carolina economy.
The figure includes money the aerospace giant will pay in state and local taxes, the amount that supporting aviation businesses will spend and funds that will filter down through employee paychecks to local grocery stores, retail shops and gas stations.
Beyond that, the company's 787 expansion could spawn 15,278 jobs, which includes the roughly 3,800 workers Boeing will need to hire to manufacture its new Dreamliner passenger jets.
In the meantime, construction of the plant is pumping an estimated $1.4 billion a year into the Charleston area.
The authors of the study say the staggering figures make the investment worth the cost of the incentive package -- a combination of property tax breaks, employee training and construction funding -- that state and local officials used to draw Boeing to the area.
"It's a worthwhile investment anyway you cut it," said public-relations adviser Bob McAlister, co-founder of the Alliance for South Carolina's Future, a pro-business, Columbia-based nonprofit that paid for the study.
The economic analysis by Miley & Associates Inc. pits the multimillion-dollar impact figures against the total cost of Boeing's incentive package, which the study valued at about $417 million.
Charleston County council members granted the company large property tax breaks in exchange for spending at least $750 million at its
North Charleston campus.
Boeing pays a lower tax rate for 30 years, and for the next 15 years, half of its annual tax bill will be given back to the company to spend on local site improvements.
Still, the company will become the largest taxpayer in Charleston County, bumping South Carolina Electric and Gas from the top spot, according to the government estimates.
South Carolina routinely ranks as having one of the highest industrial property tax rates in the country, which some critics say disproportionately shifts tax payments to manufacturers. McAlister pointed out that the state's manufacturing sector pays 13 percent of all property tax revenues though it represents only 5 percent of all establishments in the state, according to figures from the S.C. State Budget and Control Board.
State lawmakers also passed legislation that gave Boeing $270 million to help pay for the cost of the $750 million jet assembly building, which is slated to open next year at Charleston International.
As state Commerce Dept. officials drew up that deal, they used their own economic model to study the potential benefit, which ultimately puts South Carolina out on top by $4.4 billion during the next 15 years.
McAlister said the group paid for the impact study to show other companies how Boeing will contribute to the state's economic health.
Reach Katy Stech at 937-5549 or email@example.com.