Business

Washington State Ranks Poorly On Economic Report

PG Veer Contributor

The state of Washington had the worst performance among mining states in the U.S., according to the Fraser Institute’s “Survey of Mining Companies: 2014.” Overall, it ranked 63 out of the 122 jurisdictions that were evaluated – countries and sub-jurisdictions like Canadian provinces or Australian territories alike.

In fact, the Evergreen State’s performance is sometimes abysmal, especially when it comes to uncertainty about regulations. “This is the greatest impediment to mining investments,” says Kenneth Green, Senior Director of Natural Resources at the Fraser Institute and co-author of the research. “Considering the vast sums of money mining companies have to invest for exploration, applications, permits, etc., they want to make sure that all this money will be paid back.”

And this payback is very uncertain in Washington. Concerns about environmental regulations make the state fall fourth to last, barely ahead of California, Venezuela and French Guiana. When it comes to uncertainties arising from the application and interpretation of existing regulations, the state ranks #106 behind countries like Vietnam and Greece.

Greene adds that duplication among numerous government agencies also fuels uncertainty. According to the survey, this climate ranks Washington #106 with respect to “regulatory duplication and inconsistencies”, behind French Guiana and Vietnam.

The duplication doesn’t just concern mining. The Washington Research Council addressed the issue in a 2013 paper that suggests to delegate specific permits to a single agency. It also suggests that the permits cover the whole lifetime of the project rather than the present two-year period. This short time span requires “companies to repeat the same permitting process for the same project, adding costs and staff time without additional environmental benefits.”

With this survey in hand, Green believes that mining companies have the necessary tools to improve the business climate. “Since we first published our report in 1997, the market has validated it over and over again. Business owners use it to evaluate their peers’ opinion about a particular jurisdiction and governments can use it to optimize their public policies.”

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