Industrial Lands Report Pierce County 2_09

Industrial Land Use, Availability and the Jobs-Based Economy A Study of Industrial Land in Pierce County, WA

Pierce County Economic Development Division February, 2009

Introduction Land-use and economic development policy in Pierce County is based on the idea of encouraging enough job creation to keep pace with population growth – on encouraging a “jobsbased economy.” And the focus is on development of basic industries; that is, the creation of jobs in industries which pay above average wages and which bring new money into the area. But maintaining that level of job creation requires there be sufficient land available to support those jobs. Several factors led the Economic Development Division to undertake a study of the industrialland supply in Pierce County. After historically slow absorption of industrial land throughout the county, development of industrial sites picked-up markedly in the last five years. At the same time, the staff of the Economic Development Board began finding they could not respond to some inquiries from prospective industrial users because they could not find any suitable properties to show. The intersection of those two trends calls into question our ability meet the job-creation goals necessary to truly develop a “jobs-based economy.” This study examines the amount of land available for industrial development throughout Pierce County, and some of the implications those findings may have for job creation. It starts with a more in-depth discussion of why jobs in basic industries are important, and what those industries are. Next, it discusses what industrial land is, why it’s important, how much we have, and some of the factors that make land well suited to industrial development. Finally, it goes on to combine the employment and land information to draw some conclusions about our ability to continue creating jobs in primary industries.

Not All Jobs Are Created Equal An economy is like a swimming pool in some respects. A swimming pool holds a lot of water and constantly re-circulates most of it. Sometimes water leaks out of the system and new water needs to be added. Likewise, economies hold a lot of money and most of it is constantly being re-circulated. Some of it leaks out to other areas, but new money is constantly being added. The big difference between a swimming pool and an economy is that you can’t overfill an economy. In fact, the central concern of economic development efforts is to see that more new money comes into the economy than leaks out, thereby gradually increasing the overall wealth in a community. Some businesses operate like the pumps and plumbing in the swimming pool. They play a vital role in keeping the money moving around the system, but they can’t add new money to the system when some of it leaks out. Other businesses, sometimes called “basic industries,” act more like a garden hose refilling the pool. They add new money to the system, replacing the money that has leaked out and, over time, increasing the total amount of money in the system. That’s why economic development efforts tend to focus on basic industries. All businesses are important to an economy, but basic industry businesses are the ones that contribute most to overall wealth creation. The loss of basic industries in a community is equivalent to slowly draining the water from the swimming pool.

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Economic development efforts are generally focused on increasing wealth in a community, and they pursue job-creation strategies to reach that end. For most people, wealth comes from having sufficient income to meet today’s needs, and still having enough left to invest for the future. Figure 1 Personal income comes from many sources, but income from wages and salaries contributes the Components of Personal Income Pierce County, 2006 majority of money available to households. As shown in Figure 1, in Pierce County in 2006, about 74 percent of total personal income came from employment earnings, while the rest came from investments such as rental property and stock dividends, and transfer payments such as retirement Earnings and social programs. But job creation in and of itself 74% Investments is not sufficient to increase incomes in a community. 12% The amount of income generated in a community depends on the mix of occupations in which people Transfer are employed, and the mix of industries which Payments employ them. 14% In addition, some industries produce goods and services which are exported outside the region where they are produced, and in turn, bring money into the region that otherwise would not be there. In contrast, other industries tend to circulate money that is already in the region, until it eventually “leaks” out “Export” or “Basic” Industries to other areas to purchase goods and services not produced locally. Examples of firms that add value locally, then sell Source: Bureau of Economic Analysis, Local Area Personal Income

their goods or services to other areas, thereby bringing new money into the local economy include:

Firms which bring in “new” money are part of “export” industries – not because they necessarily ship anything Boeing Davita overseas, but because they sell their wares outside of the Toray Composites Medallion Foods Russell Investments Interstate Distributors economic region where they operate. The mix of export industries within an economic region constitutes that “Service” or “Non-basic” Industries region’s economic base – they form the base or the foundation for all other economic activity. Both types of Examples of firms that provide goods and services to the local market and circulate money through industries are important. Export, or “basic,” industries the local economy include: combine capital and labor to create value, and provide Safeway Stores McDonalds Restaurants growth in the regional economy by exporting that value Tapco Credit Union Guitar Center outside the region and injecting new money back in. 24-Hour Fitness Walt’s Auto Repair Service, or “non-basic” industries which circulate money that is already in the region tend to provide goods and services to meet our daily needs and add quality to our standard of living.1

1

Definitions of “export” and “service” industries are drawn from Economic Base Theory. For a detailed discussion of this theory, see Malizia, Emil and Edward Feser. Understanding Local Economic Development. Center for Urban Policy Research, Rutgers, The State University of New Jersey, New Brunswick, New Jersey: 1999.

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Just as some industries add more to a region’s economy by bringing new money into the region, employees in some occupations are better compensated than employees in other occupations, and are therefore better able to build wealth. All other things being equal, employees who earn more have more disposable income to spend in the community, and thereby support the businesses in non-basic industries, and they have greater capacity to make investments which grow the economy. As a result, the goal of most economic development programs is to increase employment in basic industries to bring more money into a region, and especially those industries which employ more highly-paid occupations so there is more money available to circulate through and invest in the economy. To carry our analogy further, if we want to enjoy our swimming pool, we have to keep it full.

Basic Industries Basic industries in Pierce County are generally related to military, port, health care and manufacturing activities.2 The military is important because its output is nearly 100% export – the services provided by the bases in Pierce County are paid for and consumed by the entire country.3 New military-related money coming into the county covers wages and salaries, military construction and contracts for goods and services. Studies conducted for Washington’s Office of Financial Management have shown that military facilities in Pierce County provide 20% of all wage and salary disbursements and provide 14% of employment in the County.4 Records from the U.S. Department of Defense show that prime contracts for military procurements from firms in Pierce County totaled over ¾ billion dollars in 2006.5 Military contributions to the Pierce County economy dwarf the contribution of any other basic industry here. While the health care industry certainly serves the local population, it also serves the greater southern Puget Sound region. Clients come to hospitals, out-patient facilities and specialists in Pierce County because those services may not be available in the surrounding rural counties. In addition, when health care services are paid for through retirement plans, Medicare or Medicaid it generates mostly new money coming into the community. As a result, for many years Health Services has been the second largest export-industry employer, with nearly half of all export employers providing health care services and counseling.6 Port services are used by customers from all over the globe. While millions of tons of goods move through the Port of Tacoma each year, only about 2% of that volume is imported or exported by companies located in Pierce County. Hence, the value added by Port services is almost entirely exported out of the region and traded for new money which then enters the local economy. 2

Mann, Bruce and Ben Frerichs. An Economic Base Study for Pierce County, Washington, 1992. Pierce County Department of Community Services, Tacoma, Washington: 1996. 3 According to IRS Tax Statistics, Pierce County accounts for less than 0.3% of all income taxes paid nationwide. 4 Sommers, Paul. Economic Impacts of the Military Bases in Washington. Washington State Office of Financial Management, Olympia, WA: 2004. 5 Wallace, Dave and Paul Turek. The Military’s Role in the Washington State Economy. Washington State Employment Security Department, Labor Market and Economic Analysis Branch, Olympia, WA: 2007. 6 Mann and Frerichs: 1996.

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Finally, manufacturing is a vital component of Pierce County’s economic base. From musical instruments to huge parts for airplanes, from fine candies to industrial baking equipment, a very wide range of products are produced here. Most of what is produced in Pierce County is shipped to customers in other Classifying Industries and Occupations parts of the country, or outside the U.S. to locations around For purposes of statistical consistency, the U.S. the world. Office of Management and Budget determines Occupation and Industry Value in Pierce County

the procedures federal statistical agencies will use when collecting and publishing data. Occupational information uses the Standard Occupational Classification (SOC) methods which groups similar occupations such as lawyers or machinists into broad categories. Industry information follows the North American Industrial Classification System (NAICS) which groups related industries such as Utilities or Social and Health Services into broad categories. Most studies examining industries or occupations use these classification systems because the most readily available data follows their conventions.

Every industry employs some people in nearly every occupation. It takes skilled and unskilled workers to keep restaurants operating, to build aircraft, to deliver health services and to make and deliver all the goods and services produced in Pierce County. Within any given industry wages can vary widely depending on the occupation, and within a given occupation, wages vary between industries. On way to look at the relative value of different occupations and different industries is to compare actual wages. If all jobs were compensated equally, one would expect the percentage of wages to be equal to the percentage of employment. For example, if an industry occupation represented 5 percent of total employment, one would expect it to also account for 5 percent of total wages. So, if the wage percentage was divided by employment percentage, the result would have a value of 1 (0.05 / 0.05 = 1). Since industry occupations are not compensated evenly, relatively lower paying industry occupations would have a value of less than one, and higher paying industry occupations would have values greater than 1. Table 1 makes that comparison by dividing the percentage of wages in broad categories of industry occupations by the percentage of employment in industry occupations and displaying those industry occupations which are at least 15 percent higher than the expected value of 1. Occupations related to engineering, finance, computers, science, healthcare practice, legal, installation and maintenance, management and sales score higher across industries than other occupations, indicating they have higher than average wages. The manufacturing and utilities industries have the most occupations with higher than expected scores and have the highest average scores across all occupations. In other words, manufacturing and utilities create jobs in a wide variety of occupations, from production to engineering to sales to maintenance and repair, and those jobs tend to pay more than similar jobs in other industries. Manufacturing is especially notable because as an industry it represents over 8 percent of total employment in Pierce County, compared to Utilities which represents less than 0.5 percent. Data used to derive Table 1 including the values and percentages for industry and occupation employment and average wages are presented in Appendix A. The hallmarks of what makes for a “good job” go beyond just wages. The benefits which are part of the overall compensation package are also important, as is the stability of the job. Table 2 shows the benefits associated with groups of occupations, and Table 3 shows the amount of employee turnover in various industries. Professional and management occupations tend to offer

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the best packages of benefits, followed by occupations in production, installation, maintenance and repair. Industries with the lowest amount of turnover, suggesting greater job stability, include utilities, government, educational services and mining.

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Table 1 Estimated Occupation and Industry Wages Relative to Employment 15% or More Above Expected Value* Pierce County - 2007

11-21

Utilities

23

Construction

42 44-45 22, 48-49

2.02

Manufacturing

2.17

Wholesale Trade

1.79

1.67

1.93

1.42

1.93

1.83 1.39

1.62

1.70 1.50

1.84

1.75

1.23

1.26

1.27

1.81

2.06

1.59

1.70

1.22

2.25 2.63 2.21

1.95 1.96 1.82

3.29

1.18

1.87

3.64 3.24

1.19

1.42 1.19

1.61

1.33

1.75

1.54

1.54

1.37

1.74

1.19

1.67

1.67

1.42

52-53

Financial Activities

1.82

1.46

2.40

54-56

Professional and Business Services

61-62

Education and Health Services

71-72

Leisure and Hospitality

81

Other Services

92

Government

Total industries 15% or more above expected values Average occupation score across all industries

1.30

1.65

2.45

1.24

1.19

1.38 1.82

1.52

2.30

1.63

2.02 2.12

1.65

1.87

2.30

1.86

1.61

1.31

3.22 3.69 3.20

1.15

1.20

1.33

1.69

1.21

1.22

0.90 1.78

1

1.17

1.96

16

1.63

1.68

11

1.33

0

0.97

1.45

12

1.35

1.31

11

1.34

1.87

12

1.40

3

1.06

1.81

1.63

0 16

1.46

Retail Trade Information

Average indsutry score across all occupations

Total occupations 15% or more above expected values

Transportation and material moving occupations

Sales and related occupations

Protective service occupations

Production occupations

Personal care and service occupations

Office and administrative support occupations

Management occupations

Life, physical, and social science occupations

Legal occupations

Installation, maintenance, and repair occupations

Healthcare support occupations

Healthcare practitioners and technical occupations

Food preparation and serving related occupations

2.18

1.24

2.22

Transportation & Warehousing

51

Farming, fishing, and forestry occupations

Education, training, and library occupations

Construction and extraction occupations

Computer and mathematical occupations

Community and social services occupations

Business and financial operations occupations

Arts, design, entertainment, sports, and media occupations

Natural Resources and Mining

22 31-33

Architecture and engineering occupations

Industries

NAICS Code

Building and grounds cleaning and maintenance occupations

Occupations

1.29

7

4

0

7

2

7

5

4

4

0

7

0

6

6

6

6

2

1

4

3

7

1

1.62

1.06

0.67

1.50

0.98

1.51

1.13

1.05

0.92

0.57

1.62

0.75

1.11

1.67

1.55

2.57

0.84

0.58

0.93

0.82

1.19

0.75

1

0.93

0

0.69

0

0.73

6

1.18

* Industries and occupations w here the percentage of w ages is equal to the percentage of employment have a value of 1; higher-w age industry occupations have a value greater than the expected value of 1. "In other w ords, manufacturing and utilities create jobs in a w ide variety of occupations, from production to engineering to sales to maintenance and repair, and those jobs tend to pay more than similar jobs in other industries." Source: Pierce County Economic Development Division analysis of data from Bureau of Labor Statistics, Quarterly Census of Employment and Wages and Occupational Employment Survey; Bureau of Economic Analysis, Local Area Income Estimates

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Table 2 Non-Wage Benefits By Occupation Nationwide - 2008 Employer-paid percentage of healthcare benefits

Percentage w ith health-care plan available Medical

Dental

Vision

Prescriptions

Single

Family

71

47

28

68

81

71

All w orkers

Percent w ith Average monthly employee access to contribution for health-care employerbenefits participating Single Family retirement $

87.69

$

330.99

61

Percent w ith paid leave Holidays

Vacations

Personal

77

78

37

Occupations Management, business, and financial

94

69

37

90

82

72

$

82.79

$

316.15

82

96

96

54

Professional and related

82

58

37

79

82

72

$

87.54

$

339.50

73

86

84

55

Service

46

29

20

45

77

66

$

96.00

$

350.84

37

52

61

26

Sales and related

63

42

22

60

77

67

$

94.37

$

347.95

60

72

72

34

Office and administrative support

77

51

28

73

81

68

$

87.13

$

354.13

68

88

86

42

Construction, extraction, farming, fishing, and forestry

71

37

26

66

87

74

$

89.62

$

339.22

58

62

63

18

Installation, maintenance, and repair

83

52

37

79

80

71

$

92.53

$

322.26

67

93

91

35

Production Transportation and material moving

82 73

54 44

32 28

79 70

83 82

77 72

$

81.03

$

278.45

$

80.80

$

300.50

68 63

92 78

90 76

32 31

Source: Bureau of Labor St atist ics, 2008 National Compensat ion Survey

Table 3 Employment Turnover By Industry Pierce County Industry

Third-quarter Turnover 2002

2003

2004

17.5%

19.1%

17.7%

2005 18.70%

2005 17.20%

2007 17.80%

Average 17.90%

Std. Dev. 0.75%

21 Mining,Quarrying,and Oil and Gas Extraction

6.0%

9.7%

8.9%

6.60%

7.10%

6.80%

6.83%

0.25%

22 Utilities

2.8%

3.1%

4.0%

3.10%

4.40%

4.00%

3.83%

0.67%

15.7%

15.40%

14.80%

15.20%

15.13%

0.31%

11 Agriculture,Forestry,Fishing and Hunting

23 Construction

15.9%

14.4%

31-33 Manufacturing

8.0%

6.8%

8.4%

8.30%

8.40%

8.40%

8.37%

0.06%

42 Wholesale Trade

11.9%

7.5%

8.8%

8.70%

8.90%

8.80%

8.80%

0.10%

44-45 Retail Trade

12.0%

10.9%

12.7%

12.00%

12.60%

12.50%

12.37%

0.32%

48-49 Transportation and Warehousing

8.8%

7.5%

9.6%

9.50%

8.60%

8.30%

8.80%

0.62%

51 Information

6.6%

18.8%

6.5%

7.10%

9.00%

8.50%

8.20%

0.98%

52 Finance and Insurance

7.0%

7.3%

8.9%

10.10%

8.80%

8.90%

9.27%

0.72%

53 Real Estate and Rental and Leasing

14.6%

13.0%

13.3%

13.50%

13.40%

13.60%

13.50%

0.10%

54 Professional,Scientific,and Technical Services

12.7%

8.1%

10.1%

10.10%

10.70%

10.70%

10.50%

0.35%

6.2%

6.2%

8.1%

7.60%

8.30%

7.80%

7.90%

0.36%

17.1%

16.6%

17.8%

18.10%

18.00%

19.20%

18.43%

0.67%

61 Educational Services

5.8%

5.8%

5.9%

6.10%

6.20%

6.30%

6.20%

0.10%

62 Health Care and Social Assistance

8.6%

8.0%

8.2%

8.60%

8.90%

9.10%

8.87%

0.25%

71 Arts,Entertainment,and Recreation

15.9%

14.4%

14.5%

13.90%

13.30%

14.80%

14.00%

0.75%

55 Management of Companies and Enterprises 56 Administrative, Support, Waste Management & Remediation

72 Accommodation and Food Services

20.7%

19.0%

20.6%

20.60%

21.90%

21.10%

21.20%

0.66%

81 Other Services (except Public Administration)

15.6%

11.8%

13.2%

12.10%

13.30%

11.80%

12.40%

0.79%

3.7%

3.7%

4.1%

4.00%

4.80%

4.00%

4.27%

0.46%

92 Public Administration Source: U.S. Census Bureau, Local Employment Dynamics, Quart erly Workforce Indicat ors

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Why Industrial Land in Pierce County is Important Some regions are more energetic than others when regulating land use. Due to our rapidly growing population and perceptions that previous land-development patterns were not conducive to the provision of cost-effective public services, Washington adopted aggressive land-use policies. In the early 1990’s Washington State began implementing land-use regulation to curb “urban-sprawl” development, and operationalized it through the State’s Growth Management Act. Because export industries are so important to the health of our economy, it is critical that land-use authorities planning under Growth Management allow sufficient room for those industries to grow as the labor force grows. Areas of the country with less dense population and without stringent land-use regulation do not have the same constraints as communities in Washington and as a result they have more flexibility in terms of siting industrial uses. From a land-use perspective, the military is for the most part self contained. However, it is important that actions taken by local jurisdictions do not impede the military’s ability to perform their appointed mission. Aside from being good neighbors, the County has no role in planning for military land uses. The County and cities and towns do have a role in preventing incompatible land uses around the bases, and in ensuring the goods and services needed by the military and military personnel are available in the surrounding communities. Health care is a very diverse industry, with establishments ranging in size from oneperson offices to regional hospitals. Much of this industry has a wide array of options for where new businesses are able to locate. In general, any commercial zone will accommodate some level of use for health-care services. Most port-related activities are situated in and around the Port of Tacoma industrial area, sufficiently proximate to the rail lines and marine terminals for the efficient movement of goods. Because of the need for port-related businesses to be proximate to the Port of Tacoma, most port-related land-use issues are within the jurisdiction of the Cities of Tacoma, Fife, Milton, Puyallup and Sumner. Like the health-care industry, manufacturing occurs in a wide range of settings, from small shops to very large production facilities. However, unlike health care which can locate in many different land-use zones, manufacturing is essentially limited to locating in zones specifically dedicated to industrial use. The basis for these regulations is that placing industrial uses next to some other uses, such as residential areas, creates “across the fence” problems – some land uses make poor neighbors. Industrial activities can be loud and create traffic conditions which are difficult live or recreate around. Many examples can be found where an industrial use, such as a lumber mill, had no immediate neighbors when it was originally built, but as the county has grown residential development has encroached on the facility and made it difficult or impossible to continue operations. In order to retain and grow the industrial employment from such facilities it is imperative that there are industrial zones with sufficient capacity

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for those businesses to relocate, as well as places for businesses new to the community. Aside from regulatory restrictions on where industrial uses can be placed, there are physical considerations which limit the options for locating production facility. Precision manufacturing often requires very exacting specifications in terms of the sub-strata on which a facility can be located. Machines which are extremely heavy or which produce extreme downward force, such as punch-presses, can not be operated on ground subject to subsiding, and machines which operate at tolerances in the range of 1/10,000 of an inch are sensitive to seismic disturbance. Considering the breadth of occupations and the quality of employment offered in the manufacturing sector, it is important to ensure there is sufficient land of appropriate quality available to support the continued expansion of this industry sector.

Buildable Lands The implementation of the Growth Management Act by its very nature places constraints on the types and locations of development that can occur. Every five years the County produces a “Buildable Lands Report” which compares population and employment projections to current land supply and historic development patterns. This report provides an assessment of communities’ ability to accommodate projected economic and population growth. In the most recent report, released in 2007, the analysis found the estimated employment capacity to be in excess of projected needs – that is, there is more land zoned for job creation than will be needed by the year 2020. However, there are important reasons why that report may underestimate the real land needs relative to future economic development. It is important to note that the Buildable Lands Report considers employment for all sectors, not just industrial uses. It starts with a projection for total employment growth provided by the Puget Sound Regional Council and the State of Washington, and makes no distinction between industries or occupations. In contrast to the Buildable Lands Report, this report considers only industrial land, and takes as its starting point the proposition that job creation in the County’s basic industries is vital to continued economic growth and broad-based wealth creation. There are methodological factors which may lead the Buildable Lands Report to underestimate the amount of land needed to accommodate future job growth. First, as noted in the report, the analysis does not include construction employment. The rationale for excluding those jobs from the analysis assumes that most workers in the construction trades are located at building sites, so there is no land associated with those jobs. To a large degree that is likely a safe assumption. However, larger construction firms do require a central location for storing equipment and materials, and such contractor’s yards are for the most part only allowed in industrial zones, hence they will decrease the amount of industrial land available for other sectors such as manufacturing.

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Perhaps the most important category of employment not reflected in the Buildable Lands Report capacity analysis involves “non-employer firms.” Thses are companies that have no employees other than the owner(s), and constitute a significant portion of businesses nationwide and in Pierce County. Table 4 shows the number and receipts of nonemployer firms in Pierce County in 2006 by broad industry category. Many of these firms are small and home-based, so it would be inappropriate to include those in the capacity analysis. The Small Business Administration (SBA) estimates that about 50 percent of all businesses with fewer than 500 employees are home-based.7 However, there are important segments of non-employer businesses which could impact overall land needs for employment growth, and therefore introduce error into the Buildable Lands analysis. The same SBA study, which surveyed over 16 million small businesses nationwide, found that about 40 percent of non-employer firms are not home based. If that percentage holds for Pierce County, about 15,600 non-employer firms are operating in non-residential settings. Table 5 presents examples of non-employer firms which are unlikely to be home-based. The Buildable Lands analysis does not take these firms into account, nor does it contemplate the land needs associated with the growth in this portion of the economy. It is likely that if growth of non-employer firms were incorporated into the analysis, the outcome would be a finding that there is insufficient land zoned for job creation overall. A review of zoning regulations within the cities and towns in Pierce County reveals that many commercial uses are allowed in the few zones that also allow industrial uses. As demand for commercial land outpaces the available supply, it is likely that industrial land will increasingly be absorbed for commercial but non-industrial purposes. As mentioned above, Service industries are vital for maintaining a healthy economy, but Basic industries are the key to long-term broad-based wealth creation for the entire Pierce County region – they are the garden hose that keep our swimming pool full. Table 4 Non-employer firms by industry Pierce County, 2006 NAICS Code

NAICS Description

Firms

0

Total for all sectors

11

Forestry, fishing & hunting, and agricultural support services (NAICS 113-115)

21

Mining

22

Utilities

23

Construction

31-33 42

Reciepts

38,995

$ 1,783,202,000

Average Reciepts per Firm $

45,729

456 $

26,390,000

$

57,873

4 $

415,000

$

103,750

40 $

3,130,000

$

78,250

3767 $

275,033,000

$

73,011

Manufacturing

707 $

29,460,000

$

41,669

Wholesale trade

794 $

56,904,000

$

71,668

44-45

Retail trade

4674 $

163,672,000

$

35,018

48-49

Transportation and warehousing

1534 $

121,029,000

$

78,898

493 $

11,263,000

$

22,846

51

Information

52

Finance and insurance

1472 $

64,485,000

$

43,808

53

Real estate and rental and leasing

6068 $

508,939,000

$

83,873

54

Professional, scientific, and technical services

5072 $

169,837,000

$

33,485

56

Administrative and support and waste management and remediation services

2557 $

55,321,000

$

21,635

61

Educational services

927 $

12,686,000

$

13,685

62

Health care and social assistance

3053 $

110,786,000

$

36,288

71

Arts, entertainment, and recreation

1788 $

32,039,000

$

17,919

72 81

Accommodation and food services Other services (except public administration)

414 $ 5175 $

14,045,000 127,768,000

$ $

33,925 24,689

Source: U.S. Census Bureau, EPCD, Nonemployer Statistics

7

Small Business Administration. The Small Business Economy for Data Year 2006. United State Printing Office: 2007.

Page 10

Table 5 Selected non-employer firms unlikely to be home-based Pierce County, 2006 NAICS Code

NAICS Description

3231

Printing and related support activities

333

Machinery manufacturing

Firms

Reciepts 69 $

Average Reciepts per Firm

2,524,000

$

31

$

1,783,000

$

36,580 57,516

116

$

17,514,000

$

150,983

44112

Used car dealers

4451

Grocery stores

90

$

13,165,000

$

146,278

4452

Specialty food stores

66

$

3,154,000

$

47,788

45393

Manufactured (mobile) home dealers

5

$

389,000

$

77,800

53121

Offices of real estate agents and brokers

2,478

$

117,778,000

$

47,529

5321

Automotive equipment rental and leasing

6211

Offices of physicians

30

$

1,763,000

$

58,767

284

$

27,965,000

$

98,468

6212

Offices of dentists

46

$

3,444,000

$

74,870

62131

Offices of chiropractors

63

$

3,462,000

$

54,952

62132

Offices of optometrists

19

$

712,000

$

37,474

62133

Offices of mental health practitioners (except physicians)

195

$

9,644,000

$

49,456

88

$

4,154,000

$

47,205

3

$

173,000

$

57,667

426

$

13,373,000

$

31,392

62134

Offices of physical, occupational and speech therapists, and audiologists

621391

Offices of podiatrists

621399

Offices of all other miscellaneous health practitioners

6214

Outpatient care centers

31

$

12,206,000

$

393,742

6215

Medical and diagnostic laboratories

28

$

1,627,000

$

58,107

7221

Full-service restaurants

51

$

2,399,000

$

47,039

7222

Limited-service eating places

92

$

3,525,000

$

38,315

7224

Drinking places (alcoholic beverages)

12

$

901,000

$

75,083

8113

Commercial and industrial machinery and equipment (except automotive and electronic) repair and maintenance

108

$

5,085,000

$

47,083

Source: U.S. Census Bureau, EPCD, Nonemployer Statistics

Defining “Industrial Land” For the purpose of this study, zoning is considered “industrial” if it allows manufacturing and assembly. There is little consistency between jurisdictions as far as what other uses are allowed in an industrial zone, or how zoning maps are drawn, so not all industrial zones are equivalent. Even within Pierce County’s development regulations there are differences between community plan areas as far as what is allowed in industrial zones. This inconsistency introduces error into attempts to inventory industrial land because activities that are allowed in one industrial zone may not be allowed in another. For example, some jurisdictions allow a wide range of commercial uses that are not typically considered industrial in nature. Some jurisdictions have an industrial zone in their zoning code, but have not implemented that code by designating any land to that zone. Some jurisdictions only allow existing industrial uses, not new uses. Some jurisdictions allow zoning to split parcels, so one parcel may have two or more zoning designations. And some jurisdictions have developed zoning designations for areas within their Urban Growth Area, but outside their corporate limits, which do not always agree with extant Pierce County zoning, and would further reduce the industrial land supply if those areas were annexed prior to development

Page 11

As a first step in analyzing how much industrial land there is in all of Pierce County, zoning codes for each jurisdiction were reviewed and the zones presented in Table 6 were selected as “industrial,” based on the ability to perform at least light manufacturing in the zone. Table 6 Zoning Districts Considered "Industrial" For Analysis Jurisdiction Bonney Lake

Zone M1; C3

Description Manufacturing; Heavy Commercial, Warehousing and Light Manufacturing

Buckley

LI

Light Industrial

DuPont

BTP; MRP; IND

Edgewood

BP; I

Business Tech Park; Manufacturing and Research; Industrial Business Park; Industrial

Fife

BP; I

Business Park; Industrial

Fircrest

CC

Community Commercial

Gig Harbor

C1; ED; PCD-BP; MUD

General Commercial; Employment District; Planned Community DevelopmentBusiness Park; Mixed Use District Overlay

Lakewood

IBP; I1; I2

Industrial Business Park; Industrial 1; Industrial 2

Milton

M1

Light Manufacturing

Orting

LM

Light Manufacturing

Pacific

LI

Light Industry

Pierce County

EC; CE

Employment Center; Community Employment

Puyallup

MP; ML

Business Park; Limited Manufacturing

South Prairie

I

Industrial

Steilacoom

I

Industrial

Sumner

M1; M2;

Light Manufacturing; Heavy Manufacturing

Tacoma

M1; M2; PMI

Light Industrial; Heavy Industrial; Port Maritime and Industrial

Unversity Place

LI-BP

Light Industrial - Business Park

Industrial Land Supply in Pierce County Just as there are great differences between occupations and industries, there are great differences between parcels of land zoned for industrial uses. Large tracts of land close to major transportation corridors that are served by utilities and free of environmental features such as wetlands are in high demand. Small, isolated parcels, far from transportation and other infrastructure, or those with major environmental features are slow to develop because they are unsuitable for many uses, costly to build on and transportation to and from them increases operating costs. Large parcels offer economic efficiencies in both construction and operation of facilities. Small parcels can be combined, but only if there is a sufficient amount of land available in the right configuration. Even then there is added complexity when dealing with multiple land owners. Land for industrial development can only be acquired from “willing sellers” so one land owner who’s property is required for an assemblage of parcels but is reluctant to sell can make an entire project unfeasible. The presence of environmental features such wetlands or steep slopes does not necessarily preclude industrial development, but it does

Page 12

add to the cost and the time it takes to get a building constructed, and they generally reduce the amount of land area available to build upon. As new regulations are adopted, such as those addressing storm-water runoff and retention, the amount of land required for development of individual projects tends to increase in order to comply with those regulations, which effectively reduces the amount of land available for job creation. In all of Pierce County, including unincorporated areas, cities and towns, there is a total of about 16,000 acres of land zoned for industrial uses (using the zoning designations identified in Table 4). Less than 1/3 of these are in unincorporated Pierce County. Distributions of industrial land are shown in Table 7 and mapped in Figure 2. Nearly half of Pierce County’s industrial land is already fully developed and unlikely to have capacity for adding substantial numbers of jobs. Of the remainder, nearly half has substantial known environmental constraints such as wetlands, steep slopes, flood hazard, or critical habitat areas. For all areas in the County, there are a total of about 4,700 acres zoned for industrial development which are currently undeveloped or underdeveloped and do not have substantial known environmental constraints. Those 4,700 acres are split between approximately 2,300 parcels, for an average parcel size of 2.1 acres. The largest area within a single parcel without known environmental constraints is about 190 acres, although that parcel will soon be divided into several smaller parcels (discussed in more detail below). Fewer than 10 parcels have over 50 unconstrained acres, and over 1,500 have less than 1 acre. In unincorporated Pierce County there are just over 2,000 acres of developable industrial land, with an average parcel size of 2.3 acres. Table 7 Acres of land zoned for industrial uses Pierce County, February, 2007 Remaining Developable Industrial Land* Area Without Identified Environmental Constraints

Jurisdiction

Acres Already Developed

Total Acres

Total Acres

Acres In Identified Environmental Constraints

Number of Parcels

Average Unconstrained Parcel Acres

Total Acres

Largest Parcel

Buckley

46

20

26

5

20

6

1.2

3

Dupont

893

228

664

55

92

573

10.4

190

Edgew ood Fife Fircrest

64

26

38

15

16

22

1.5

5

1,558

715

843

182

334

509

2.8

65

17

7

10

2

0

10

4.9

9

Gig Harbor

194

48

147

26

114

32

1.2

17

Lakew ood

566

316

250

148

47

203

1.4

23

Milton

115

54

61

46

39

22

0.5

Orting

1

1

1

1

0

0.0

Pacific Pierce County Puyallup Steilacoom

3 -

180

80

100

60

34

66

1.1

3

5,152

1,509

3,642

873

1,632

2,010

2.3

60

652

343

309

82

86

223

2.7

33

74

5

50

24

4.9

20

74

Sumner

1,867

860

1,007

208

878

129

0.6

12

Tacoma

4,788

3,571

1,217

592

308

909

1.5

60

59

42

16

14

8

8

0.6

2

16,227

7,820

8,407

2,314

3,659

4,747

2.1

190

University Place Grand Total

* Includes vacant and underdeveloped. Source: Pierce County Economic Development Division analysis of Assessor parcel data

Page 13

As discussed above, a number of factors combine to make land more or less desirable for industrial development. For major development, larger parcels are better than smaller parcels, with parcels 5 acres and over being the best suited for development. Where parcels are smaller, or a large area is needed, land can be assembled, but only if there is sufficient adjacent developable land. Hence, parcels which are clustered together are better candidates than isolated parcels, and the more parcels in the cluster the better. Land with significant environmental constraints is harder to develop than land without, and so tends to be less sought-after and much slower to develop, or may not be able to support industrial development at all. Using the criteria of parcel size, current state of development, proximity to other developable parcels, and presence of environmental constraints, each parcel of land zoned for industrial uses throughout the County was given an index score related to its development potential. Other factors could also be included such as proximity to infrastructure such as roads and sewers, but were not included in this model due to the complexity it would introduce (see Appendix B for the methodology used in creating the development potential index). The scores range from 0 to 100, with the parcel having the greatest development potential using these criteria having a score of 100. As shown in Table 6 and mapped in Figure 3, over 11,000 acres have an index score of 0. Low scores are generally due to being already developed, being small or isolated parcels, or having significant environmental constraints. Just over 700 acres received the highest scores, with nearly 40 percent of that total in DuPont. About 3,900 acres fall in the middle ranges between 0 and 40. Table 8 Acres of land zoned for industrial uses Pierce County, February, 2007 Development Potential Index Score 0.00

0.01 - 2.5

Buckley

46

Dupont

228

20

37

27

977

Edgewood Fife Fircrest

2.51 - 10

310

296

152

174

115

140

18

17 94

43

39

Lakewood

483

76

7

Milton

93

22

Orting

1

Pierce County Puyallup Steilacoom

40.01 - 100

39

Gig Harbor

Pacific

10.01 - 40

175

5

3,029

860

662

449

151

416

51

32

106

47

74

Sumner

1,561

203

54

49

Tacoma

4,270

281

91

46

101

57

2

11,558

1,744

1,098

1,093

735

University Place Grand Total

Source: Pierce County Economic Development Division analysis of Assessor parcel data

Page 14

A number of cases exist which add variability to the findings presented here. Two areas are not included in these estimates which, if included, would add some industrial land capacity. First, the Town of Eatonville is in the process of annexing and planning for light-industrial development on land that was recently included in the town’s Urban Growth Area. The area was not included in this analysis because it was not zoned for industrial use when the analysis was conducted, and because plans for the area are not final, so the actual amount of developable industrial land is uncertain. Inclusion of the Eatonville land would likely add between 60 and 100 acres to the amount of developable industrial land and those parcels would likely have a high development potential index score. Second, land within the proposed Cascadia development was not included. Cascadia is a large master-planned community south of Bonney Lake and north-east of Orting. Development of the community has begun, but some of the planning is still somewhat conceptual so it is not possible to know precisely how much land will be available for industrial development. Similar to the industrial land in Eatonville, the Cascadia lands were not zoned for industrial use when this analysis was conducted. Current plans indicate there may be about 400 acres available for industrial use, and so would add a considerable amount to the inventory of lands with high development potential index scores. Conversely to land in Eatonville and Cascadia which was not included and might therefore lead to underestimation of available land, some lands were included that may lead to an overestimation of available land. In general, these lands are not considered to be “on the market,” meaning the land owners have not shown an interest in selling the properties for development. The Boeing Company owns several parcels which together account for about 270 acres. There are no known plans for future development or sale of these parcels, yet they are zoned for industrial use and were therefore included in the analysis. Similarly, many prime developable parcels are owned by the Burlington Northern and Union Pacific railroads and together account for over 300 acres. It is unclear if or when these parcels will be developed, and if so, what uses they might host. Also complicating the analysis of the available industrial land base is the planned expansion of SR-167. When built, the highway will consume a considerable amount of high-quality industrial land. Expansion of the highway is critical to the future of the Port of Tacoma and continued growth of the Pierce County economy. However, the likely alignment of the new highway section will consume nearly 500 acres of industriallyzoned land. Some of that land is very desirable because it is vacant or underdeveloped with few environmental constraints. Some of it currently has industrial development on it which will be displaced when the highway is built. While no construction date has been set, Washington State is actively purchasing right-of-way, including some large parcels of industrially-zoned land which now are presumably unavailable for industrial development. Land zoned for industrial use in the area around the Port of Tacoma, north of Interstate 5, is considered fully developed in this analysis. While there are some parcels which

Page 15

currently have no buildings on them, many of those “vacant” parcels serve as storage for industrial goods and supplies used by firms in the area. Also, some parcels may be good candidates for redevelopment, but for the most part they are already home to employers. Redevelopment of those parcels will mean the displacement of currently existing firms. Finally, First Park at Northwest Landing in DuPont deserves mention. In general, DuPont offers some of the best opportunities for industrial development in Pierce County, and First Park represents a significant portion of that inventory. When this analysis was performed, the entire site was one single parcel of about 250 acres and one of the largest industrial parcels available in the County. However, the shape of the parcel is a “doughnut” which has a premier golf course in its center, and as such is not a good fit for a single user wishing to develop a large facility as might be assumed when just considering parcel size alone. Developers of the site are currently pursuing division of the parcel into multiple smaller parcels, and it still represents one of the best opportunities for industrial development in the County. The land can still accommodate relatively large facilities – just not as large as an uninformed glance at the data might suggest.

Page 16

Figure 2

Page 17

Figure 3

Development Potential Index Scores

Page 18

Land Needs for Industrial Development Understanding the quantity and quality of land available is critical information. Taking that information one step further can be instructive. Applying knowledge of the amount of available land to what we know about how land is used and how the economy is structured allows us to understand how land might be used most efficiently. In other words, it helps us examine the question, “how many jobs can be supported by the land we have left?” If all the developable land were used for one industry, and the number of jobs created per acre was consistent with past development in Pierce, the number of jobs created would be somewhere around the values presented in Table 7. Clearly, some industries are more conducive to generating substantial job growth than others. Table 7 Expected Job Creation

Manufacturing Industrial Park Wholesale Trade Transportation Warehousing Big-Box Warehousing

Jobs per Developable Acre Acres 18.74 4,747 18.58 4,747 15.37 4,747 11.34 4,747 5.27 4,747 2.96 4,747

Expected Jobs Created 88,959 88,199 72,961 53,831 25,017 14,051

Source: Pierce County Economic Development Division analysis of 2007 Assessor and Employment Security data

However, it is extremely unlikely that all the developable land would be put to use for only one industry. Also, within and between industries there will likely be a range of employment densities. Recognizing that future development will occur among a range of activities suggests taking a more complex look at future possibilities. There are several ways to approach those possibilities, and each one requires making assumptions about industry mix and employment density. Industry mix refers to the amount of employment in each industry relative to other industries. Various ways to think about the future industry mix in Pierce County are presented in Table 8. Employment density refers to how many people are employed in a given area (such as the number of employees per acre). A variety of density assumptions are presented in Table 9.

Page 19

Table 8 Industry Mix Assumptions Assumption Assume trend for industry share of total employment growth in the last 5 years will continue

Explanation Over the 5-year period of 2002 through 2007, total covered employment in Pierce County grew by about 35,000 jobs. Of that growth, a certain percent was in each of the NAICS industry classifications. Under this assumption, each industry’s share of the growth in last 5 years will be their share of growth in the future. It also uses the Buildable Lands employment projection to find the total amount of land needed to support employment growth.

IM-2

Assume industry compound annual growth rate will continue

Over the past decade, each industry grew at a certain rate. Under this assumption, the growth rate of each industry over the past several years will continue to be their growth rate in the future. It also uses the Buildable Lands employment projection to find the total amount of land needed to support employment growth.

IM-3

Assume industry share of total employment will stay constant over time

In 2007, total covered employment in Pierce County was split between each of the NAICS industry classifications, with some industries having a larger share of total employment than others. Under this assumption, each industry’s share of total 2007 employment is held constant into the future. It also uses the Buildable Lands employment projection to find the total amount of land needed to support employment growth.

IM-4

Assume historic trend of market absorption will continue, regardless of employment forecasts

Every year a certain amount of land is developed for industrial uses. Under this assumption, recent trends for industrial development are held constant to determine the amount of land needed, regardless of employment projections. It then uses employment density assumptions to estimate the number of jobs that could be created at the given rate of absorption.

IM-1

Table 9 Employment Density Assumptions ED-1

Assume industry-specific job density from Pierce County study

Nearly 800 companies in Pierce County in the Manufacturing, Wholesale Trade and Transportation and Warehousing industries were reviewed for size of facility and number of employees. Under this assumption, the average job density from that review is applied to the projected industry employment to find the amount of land needed for future industrial employment.

ED-2

Assume job-density values from Builable Lands

The 2007 Pierce County Buildable Lands Study, a planning document accepted by Growth Management Act authorities, used employment density values derived through a deliberative process using local knowledge from regional planners and a limited number of observations. These density values are less industry specific than the values used in assumption ED-1. Under this assumption, the Buildable Lands job density is applied to the projected industry employment to find the amount of land needed for future industrial employment.

Page 20

Employment Density Assumptions ED-3

Assume job-density values from other studies

A number of other studies have attempted to find average job densities for different industries. Under this assumption, job density findings from other studies are applied to the projected industry employment to find the amount of land needed for future industrial employment.

ED-4

Assume job density from most recent 5 years of Pierce County study

Under this assumption, density values are used from the Pierce County study described in ED-1, but only from facilities built in the past 5 years.

Each assumption has strengths and weaknesses. Our economy is very dynamic. Assuming the coming years will look like past years, or assuming constant rates of change does not account for that dynamism. Manufacturing has traditionally been a very strong component of Pierce County’s economy. However, in recent years it has grown more slowly than other industry sectors, so its share of total employment has been shrinking. Since this has been a nationwide trend for some time, it may not be reasonable to assume vibrant or steady growth in manufacturing here. On the other hand, a recent Deloitte Research manufacturing study found that “Far from abandoning North America, executives see the region as the key to managing and developing their global capabilities. In fact, we see signs that more sophisticated supply-chain strategies are emerging that are not being driven simply by low-cost labor but focused more on the overall contribution to growth and profitability of the enterprise.”8 In an increasingly competitive global environment, U.S. manufacturing is becoming more productive and manufacturing enterprises view locating portions of their operations here as key to their global strategies. As such, it is reasonable to assume that manufacturing employment will continue to grow, at least to some extent. Assumptions about job density are also difficult to validate. Several studies have attempted to find average densities for various industries and land uses. Some of this information has been compiled and adopted by transportation engineers using historical surveys nationwide, going back many years, and is used to gauge traffic impacts of new developments.9 Other studies have used various methods to collect employment density data specific to the Pacific Northwest.10 All studies exhibit great variation both within and between industries, making it difficult to attribute precise density values to industries. A similar effort was undertaken for this study. Using establishment employment data 8

Giffi, Craig and Peter Koudal. Made in North America. Deloitte Research, New York: 2008. Buttke, Carl H., et. Al. Trip Generation, 5th Ed. Institute of Transportation Engineers, Washington, D.C.: 1991. 10 Pflum, Kapena. Employment Density in the Puget Sound Region (Degree Project). University of Washington, Seattle, WA: 2004; Snohomish County 2007 Buildable Lands Project. 2007 Buildable Lands Report Employment Density Study. Snohomish County Planning and Development Services, Everett, WA: 2007; Yee, Dennis and Jennifer Bradford. Technical Report: 1999 Employment Density Study. Portland Metro Growth Management Services Department, Portland, OR: 1999; Pierce County Buildable Lands Program. Appendix E, Employment Density Survey. Pierce County Department of Planning and Land Services, Tacoma, WA: 2006. 9

Page 21

from the Bureau of Labor Statistics Quarterly Census of Employment and Wages program, and parcel and building data from Pierce County’s Assessor/Treasurer, actual building size, lot size and employment were recorded for over 800 locations. Appendix C presents scatter plots of employment by lot size for industrial uses in Pierce County. As with other studies, there was extreme variation for some industries, especially Transportation and Warehousing. None of the studies attempt to show differences by age of development. In Pierce County this distinction is relevant because several facilities developed within the last 5 years have very large buildings with relatively few employees. For example, if all Warehousing uses are combined, regardless of year built, they host an average of just over 5 employees per acre. However, for facilities built within the last 5 years, that number drops below 3. This trend is true across all industrial land uses, due in part to changes in technology and increases in productivity, but is glaringly evident for warehousing. Regardless of which assumptions are used to forecast employment needs and job growth, one thing is certain. If the amount of land is held constant, then the greater the density of high-wage jobs, the greater the growth in income from wages. With a fixed amount of land designated for industrial use, the lower the job density on that land, the sooner we will deplete the supply and less likely we will be to meet our jobcreation goals. Tables 10 through 13 show how different assumptions about industry mix and employment density interact to suggest land needs for industrial development in the future.

Page 22

Table 10 - Assumes industry-specific job density from Pierce County study ED-1

Industrial Employment Density (jobs/acre) Manufacturing Wholesale Trade Transportation and Warehousing 2022 Employment Grow th

18.74 15.37 11.12 121,583 IM-1

NAICS

31-33 42 48-49

*Industry

Manufacturing Wholesale Trade Transportation and Warehousing Total

Industry Industry % of grow th based 5-year on share of 5Change year change 1.03% 6.35% 8.00%

1,248 7,720 9,735

15.38%

18,703

IM-2 Industry Acres needed Compund to support Annual grow th Grow th Rate (CAGR) 67 0.37% 502 4.63% 875 4.24% 1,444

Industry Grow th based on CAGR

IM-3

IM-4

Acres needed Industry Acres needed to support '07 industry % grow th based to support grow th on '07 ind. % grow th

1,057 10,263 8,498

56 668 764

7.22% 4.02% 3.75%

8,783 4,896 4,565

469 319 411

Sq. Ft. of industrial space absorbed per year Acres needed per year at 31% lot coverage Total acres needed by 2022

3,000,000 222 3,110

19,817

1,488

15.00%

18,244

1,198

Number of jobs supported at average density

52,128

Table 11 - Assumes job-density values from Builable Lands Report ED-2

Industrial Employment Density (jobs/acre) 2022 Employment Grow th

11.15 121,583 IM-1

NAICS

31-33 42 48-49

*Industry

Manufacturing Wholesale Trade Transportation and Warehousing Total

Industry Industry % of grow th based 5-year on share of 5Change year change 1.03% 6.35% 8.00%

1,248 7,720 9,735

15.38%

18,703

IM-2 Industry Acres needed Compund to support Annual grow th Grow th Rate (CAGR) 112 0.37% 692 4.63% 873 4.24% 1,677

Industry Grow th based on CAGR

IM-3

IM-4

Acres needed Industry Acres needed to support '07 industry % grow th based to support grow th on '07 ind. % grow th

1,057 10,263 8,498

95 920 762

7.22% 4.02% 3.75%

8,783 4,896 4,565

788 439 409

Sq. Ft. of industrial space absorbed per year Acres neede per year at 31% lot coverage Total acres needed by 2022

3,000,000 222 3,110

19,817

1,777

15.00%

18,244

1,636

Number of jobs supported at average density

34,680

Table 12 - Assumes job-density values from other studies ED-3

Industrial Employment Density (jobs/acre) Manufacturing Wholesale Trade Transportation and Warehousing 2022 Employment Grow th

21.51 13.02 9.38 121,583 IM-1

NAICS

31-33 42 48-49

*Industry

Manufacturing Wholesale Trade Transportation and Warehousing Total

Industry Industry % of grow th based 5-year on share of 5Change year change 1.03% 6.35% 8.00%

1,248 7,720 9,735

15.38%

18,703

IM-2 Industry Acres needed Compund to support Annual grow th Grow th Rate (CAGR) 58 0.37% 593 4.63% 1,038 4.24% 1,689

Industry Grow th based on CAGR

IM-3

IM-4

Acres needed Industry Acres needed to support '07 industry % grow th based to support grow th on '07 ind. % grow th

1,057 10,263 8,498

49 788 906

7.22% 4.02% 3.75%

8,783 4,896 4,565

408 376 487

Sq. Ft. of industrial space absorbed per year Acres needed per year at 31% lot coverage Total acres needed by 2022

3,000,000 222 3,110

19,817

1,743

15.00%

18,244

1,271

Number of jobs supported at average density

45,525

Page 23

Table 13 - Assumes job density from most recent 5 years of Pierce County study ED-4

Industrial Employment Density (jobs/acre) Manufacturing Wholesale Trade Transportation and Warehousing 2022 Employment Grow th

11.66 10.81 5.85 121,583 IM-1

NAICS

*Industry

31-33

Manufacturing

42 48-49

Wholesale Trade Transportation and Warehousing

Total

IM-2

Industry Industry Compund Industry % of Acres needed grow th based Annual 5-year to support on share of 5Grow th Rate Change grow th year change (CAGR) 1.03% 6.35% 8.00%

1,248 7,720 9,735

107 714 1,664

15.38%

18,703

2,485

0.37% 4.63% 4.24%

Industry Grow th based on CAGR

IM-3

IM-4

Acres needed Industry Acres needed to support '07 industry % grow th based to support grow th on '07 ind. % grow th

1,057 10,263 8,498

91 949 1,453

7.22% 4.02% 3.75%

8,783 4,896 4,565

753 453 780

19,817

2,493

15.00%

18,244

1,987

Page 24

Sq. Ft. of industrial space absorbed per year Acres needed per year at 31% lot coverage Total acres needed by 2022

Number of jobs supported at average density

3,000,000 222 3,110

28,024

Conclusion Just as maintaining the water in our swimming pool is important to keeping it a healthy environment, maintaining the flow of money is important to keeping our economy healthy. By increasing the amount of basic industry activity we can increase the total amount of wealth in our community. But doing so requires sufficient land of sufficient quality to support that increased activity. There are more than just economic benefits which come from encouraging creation of primary-industry jobs. Creating stable, well-paying jobs here reduces the need for workers to commute to other areas. Reducing commuting benefits communities by decreasing the amount of roads that need to be built and maintained; it decreases the amount of greenhouse gasses produced; it decreases the costs associated with just getting to work; and it increases the amount of time that can be spent on more enjoyable activities, and so increases the quality of life as workers have more time to spend with family in leisurely pursuits. Looking at the total amount of land zoned for industrial use, and comparing it to reasonable expectations about job growth, the raw data suggests we have just about enough land for the next 10 to 15 years.11 But much of the land is in small parcels and much of it is faced with significant environmental constraints, which leads to the view of many people that “all the easy-to-develop land is gone.” And just because land is developable, doesn’t mean it is available for sale. While our supply of developable land is increasingly held in smaller and smaller parcels, industrial users are looking for larger and larger parcels, making it increasingly difficult to keep and create primary-industry jobs here. How we use the remaining land will determine the extent to which we are able to create a “jobs-based economy.” Our ability to have existing primary businesses expand here, and have new ones locate here, will determine the character of our economy for years to come.

11

Unpublished analysis by commercial real estate appraisers have estimated the supply will last for only about 5.5 years.

Page 25

APPENDICIES

Page 26

Appendix A Industry and Occupation Employment and Wage Tables Table 14

13.8 6.5 102.0 193.8 57.7 284.9 77.5 26.2 386.4 3,854.6 2,161.2 1,740.0 236.0 541.7 9,682

N/A N/A 0.4 0.5 N/A 1.7 0.4 1.0 22.3 146.4 5,050.1 3.3 410.1 2,034.4 7,671

9.6 19.7 N/A 334.6 206.8 74.1 29.9 505.1 398.5 1,714.4 328.5 9.8 33.1 276.9 3,941

860.7 105.2 17,080.0 869.8 71.8 195.6 91.7 16.2 97.8 1,299.1 197.8 46.4 48.4 1,548.9 22,529

0.2 N/A N/A 3.4 1.9 15.0 3.0 38.9 5.1 150.2 19,816.7 77.3 189.7 545.5 20,847

308.9 0.4 1.4 39.5 57.9 23.0 2.8 N/A 1.4 28.3 4.5 5.5 1.2 31.1 506

N/A - Insufficient data available to estimate Source: Pierce County Economic Development Division analysis of data from Bureau of Labor Statistics, Quarterly Census of Employment and Wages and Occupational Employment Survey; Bureau of Economic Analysis, Local Area Income Estimates

Page 27

N/A N/A 0.5 2.5 3.2 127.3 0.4 N/A 16.1 440.5 7,739.2 31.6 72.2 343.0 8,776

155.6 375.0 1,476.3 1,811.1 1,017.0 2,111.6 777.6 778.5 887.0 854.1 717.8 436.1 1,742.5 1,000.9 14,141

3.5 2.9 3.2 11.6 4.9 3.1 3.7 13.8 133.6 1,379.0 18.5 1.3 17.7 509.1 2,106

36.9 16.4 6.4 273.6 54.5 9.4 5.3 52.8 61.6 746.9 449.5 9.8 22.4 501.7 2,247

48.5 36.8 431.5 801.0 384.2 410.2 173.7 236.6 772.4 1,269.0 1,247.7 407.4 207.1 597.4 7,024

185.9 265.7 1,725.4 3,123.1 3,298.5 6,133.3 3,586.8 1,607.6 7,966.3 9,958.1 9,254.1 1,399.2 1,398.9 4,026.5 53,929

14.1 N/A N/A 3.2 3.6 219.8 375.6 145.4 61.8 280.8 3,184.3 1,715.2 1,792.4 698.0 8,494

112.4 134.6 186.4 12,646.3 547.8 745.3 116.0 133.1 26.2 1,617.4 225.3 146.8 559.9 284.9 17,482

0.9 11.5 12.8 46.6 12.7 180.0 43.5 12.9 113.9 1,745.3 428.3 344.7 111.0 4,488.9 7,553

25.8 24.1 332.6 938.8 3,532.4 18,978.0 204.7 897.1 2,872.4 2,169.1 200.6 1,093.5 525.2 147.0 31,941

433.2 36.1 834.3 3,839.2 3,756.1 3,619.1 8,335.1 204.4 450.4 3,386.1 1,195.1 765.9 1,062.5 1,258.9 29,176

Total

Transportation and material moving occupations

Sales and related occupations

Protective service occupations

Production occupations

Personal care and service occupations

O ffice and administrative support occupations

Management occupations

Life, physical, and social science occupations

Legal occupations

8.0 4.0 5.8 49.9 49.4 1,224.2 11.9 3.9 112.7 1,060.3 15,788.3 32.0 27.5 1,175.0 19,553

Installation, maintenance, and repair occupations

0.9 N/A 5.5 99.8 14.9 1,356.5 24.0 126.3 67.6 368.0 2,726.7 25,990.2 289.4 295.0 31,365

Healthcare support occupations

Farming, fishing, and forestry occupations

Education, training, and library occupations

Construction and extraction occupations

Computer and mathematical occupations

Community and social services occupations

Business and financial operations occupations 48.9 65.4 394.9 782.4 422.5 293.7 185.0 292.7 2,592.7 2,759.6 794.6 137.6 365.2 1,758.8 10,894

Healthcare practitioners and technical occupations

0.7 2.7 9.5 110.8 68.4 150.9 4.9 589.1 39.9 516.4 296.8 256.6 103.0 73.9 2,224

Food preparation and serving related occupations

49.4 91.7 154.6 1,577.6 127.2 9.4 47.3 128.1 15.7 2,053.9 52.7 4.0 13.5 557.5 4,882

Building and grounds cleaning and maintenance occupations

NAICS Industry Description Natural Resources and Mining Utilities Construction Manufacturing Wholesale Trade Retail Trade Transportation & Warehousing Information Financial Activities Professional and Business Services Education and Health Services Leisure and Hospitality Other Services Government Total

Arts, design, entertainment, sports, and media occupations

NAICS Code 11-21 22 23 31-33 42 44-45 48-49 51 52-53 54-56 61-62 71-72 81 92

Architecture and engineering occupations

Estimated Employment By Industry By Occupation Pierce County - 2007

2,318 1,199 22,764 27,559 13,693 36,166 14,101 5,809 17,102 37,797 71,878 34,655 9,229 22,695 316,965

Table 15 Estimated Average Annual Wages Per Job By Industry By Occupation

61,348 78,293 58,873 84,053 69,483 58,410 67,811 67,235 70,538 59,082 45,234 50,362 42,744 63,071 68,386

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

24,527 64,551 41,957 54,910 43,226 26,056 43,423 46,286 56,422 44,159 26,673 31,341 29,355 44,256 39,732

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

13,538 40,494 27,488 35,369 28,197 23,679 42,034 27,029 19,414 17,300 23,550 14,918 17,594 31,440 20,106

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

$ $ $ $ $ $ $ $ $ $ $ $

$ 44,768 $ 70,942 N/A $ 86,117 $ 67,657 $ 47,129 $ 59,758 $ 64,639 $ 95,056 $ 62,277 $ 38,836 $ 32,588 $ 35,014 $ 55,600 $ 65,171

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

33,715 65,931 44,126 58,264 47,677 40,103 53,081 54,987 32,392 29,527 41,062 35,534 31,826 43,022 43,357

$

$ $ $ $ $ $ $ $ $ $ $ $

32,897 N/A N/A 71,357 48,882 31,450 47,917 37,798 63,056 35,663 33,227 27,139 19,555 37,235 33,227

$ $ $ $ $ $ $ $ $ $ $ $ $ $

13,634 48,081 38,528 49,104 35,581 32,641 45,983 N/A 29,174 29,183 33,955 26,661 29,499 51,499 23,656

N/A - Insufficient data available to estimate Source: Pierce County Economic Development Division analysis of data from Bureau of Labor Statistics, Quarterly Census of Employment and Wages and Occupational Employment Survey; Bureau of Economic Analysis, Local Area Income Estimates

Page 28

$ 20,852 N/A $ 23,115 $ 29,742 $ 24,283 $ 23,771 $ 32,328 $ 19,943 $ 17,149 $ 19,098 $ 21,675 $ 13,222 $ 15,563 $ 28,215 $ 14,754

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

48,870 84,320 59,168 79,697 65,730 61,117 58,007 70,545 88,997 50,822 69,943 32,520 40,795 65,557 68,096

$ $ $ $ $ $ $ $ $ $ $ $

N/A N/A 24,582 44,429 33,215 23,381 31,662 N/A 29,205 21,799 27,386 26,771 26,863 31,701 27,220

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

33,426 70,311 43,553 61,627 47,331 39,668 53,297 58,947 24,901 37,336 34,532 23,030 27,577 46,689 43,158

$ 49,751 $ 87,008 $ 62,648 $ 102,078 $ 85,674 $ 36,157 $ 78,206 $ 82,110 $ 72,425 $ 59,591 $ 46,844 $ 53,153 $ 39,072 $ 50,671 $ 58,429

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

54,157 75,362 55,866 76,016 70,453 54,570 63,866 72,026 89,178 58,310 45,873 32,915 37,045 55,754 58,595

$ 76,450 $ 127,456 $ 97,376 $ 141,215 $ 125,599 $ 90,354 $ 96,313 $ 124,695 $ 142,909 $ 123,845 $ 72,962 $ 40,539 $ 58,807 $ 77,783 $ 103,769

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

22,095 45,767 31,737 44,222 34,228 24,911 40,853 36,059 46,479 29,111 28,145 16,698 20,016 34,212 33,174

$ 10,574 N/A N/A $ 35,247 $ 25,862 $ 19,189 $ 50,906 $ 18,719 $ 17,031 $ 17,421 $ 18,623 $ 16,931 $ 16,693 $ 23,357 $ 19,651

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

32,293 72,540 38,784 45,999 36,392 30,389 44,642 39,973 31,947 21,403 28,402 16,132 19,491 47,216 41,414

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

11,152 54,824 30,705 45,935 34,697 29,884 40,618 35,951 32,385 18,383 27,933 17,814 16,706 50,148 38,669

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

43,187 62,283 56,565 76,089 65,029 24,916 56,283 50,765 72,356 42,022 32,246 13,872 20,069 30,335 37,196

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

22,834 51,496 34,982 38,115 32,238 23,507 43,344 29,440 18,575 19,100 21,842 12,808 15,603 40,972 32,144

Average annual industry wages

Transportation and material moving occupations

Sales and related occupations

Protective service occupations

Production occupations

Personal care and service occupations

O ffice and administrative support occupations

Management occupations

Life, physical, and social science occupations

Legal occupations

Installation, maintenance, and repair occupations

Healthcare support occupations

Healthcare practitioners and technical occupations

Food preparation and serving related occupations

Farming, fishing, and forestry occupations

Education, training, and library occupations

N/A N/A 36,487 53,662 N/A 36,856 43,024 37,764 50,268 40,037 34,567 19,958 25,114 41,150 35,954

Construction and extraction occupations

46,626 74,621 56,568 74,636 62,835 49,705 59,643 64,848 92,941 63,954 43,400 34,666 34,503 54,381 66,460

Computer and mathematical occupations

Community and social services occupations

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

Business and financial operations occupations

Arts, design, entertainment, sports, and media occupations

NAICS Industry Description Natural Resources and Mining Utilities Construction Manufacturing Wholesale Trade Retail Trade Transportation & Warehousing Information Financial Activities Professional and Business Services Education and Health Services Leisure and Hospitality Other Services Government Annual Average Occupation Wages

Architecture and engineering occupations

NAICS Code 11-21 22 23 31-33 42 44-45 22, 48-49 51 52-53 54-56 61-62 71-72 81 92

Building and grounds cleaning and maintenance occupations

Pierce County - 2007

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

29,800 65,729 43,813 54,235 47,236 28,080 44,207 50,695 60,853 37,740 39,132 14,545 22,245 45,280 39,272

Table 16 Estimated Occupation and Industry Share of Total Employment

11-21

Total industry share

Transportation and material moving occupations

Sales and related occupations

Protective service occupations

Production occupations

Personal care and service occupations

Office and administrative support occupations

Management occupations

Life, physical, and social science occupations

Legal occupations

Installation, maintenance, and repair occupations

Healthcare support occupations

Healthcare practitioners and technical occupations

Food preparation and serving related occupations

Farming, fishing, and forestry occupations

Education, training, and library occupations

Construction and extraction occupations

Computer and mathematical occupations

Community and social services occupations

Business and financial operations occupations

Building and grounds cleaning and maintenance occupations

NAICS Industry Description

Arts, design, entertainment, sports, and media occupations

NAICS Code

Architecture and engineering occupations

Pierce County - 2007

Natural Resources and Mining

0.016%

0.000%

0.004%

0.015%

0.000%

0.003%

0.272%

0.000%

0.097%

0.000%

0.003%

0.000%

0.049%

0.001%

0.012%

0.015%

0.059%

0.004%

0.035%

0.000%

0.008%

0.137%

22

Utilities

0.029%

0.001%

0.002%

0.021%

0.000%

0.006%

0.033%

0.000%

0.000%

0.000%

0.001%

0.000%

0.118%

0.001%

0.005%

0.012%

0.084%

0.000%

0.042%

0.004%

0.008%

0.011%

0.378%

23

Construction

0.049%

0.003%

0.032%

0.125%

0.000%

0.000%

5.389%

0.000%

0.000%

0.002%

0.002%

0.000%

0.466%

0.001%

0.002%

0.136%

0.544%

0.000%

0.059%

0.004%

0.105%

0.263%

7.182%

Manufacturing

0.498%

0.035%

0.061%

0.247%

0.000%

0.106%

0.274%

0.001%

0.012%

0.031%

0.016%

0.001%

0.571%

0.004%

0.086%

0.253%

0.985%

0.001%

3.990%

0.015%

0.296%

1.211%

8.695%

Wholesale Trade

0.040%

0.022%

0.018%

0.133%

0.000%

0.065%

0.023%

0.001%

0.018%

0.005%

0.016%

0.001%

0.321%

0.002%

0.017%

0.121%

1.041%

0.001%

0.173%

0.004%

1.114%

1.185%

4.320%

Retail Trade

0.003%

0.048%

0.090%

0.093%

0.001%

0.023%

0.062%

0.005%

0.007%

0.428%

0.386%

0.040%

0.666%

0.001%

0.003%

0.129%

1.935%

0.069%

0.235%

0.057%

5.987%

1.142%

11.410% 4.449%

31-33 42 44-45 22, 48-49

0.731%

Transportation & Warehousing

0.015%

0.002%

0.024%

0.058%

0.000%

0.009%

0.029%

0.001%

0.001%

0.008%

0.004%

0.000%

0.245%

0.001%

0.002%

0.055%

1.132%

0.118%

0.037%

0.014%

0.065%

2.630%

Information

0.040%

0.186%

0.008%

0.092%

0.000%

0.159%

0.005%

0.012%

0.000%

0.040%

0.001%

0.000%

0.246%

0.004%

0.017%

0.075%

0.507%

0.046%

0.042%

0.004%

0.283%

0.064%

1.833%

52-53

Financial Activities

0.005%

0.013%

0.122%

0.818%

0.007%

0.126%

0.031%

0.002%

0.000%

0.021%

0.036%

0.005%

0.280%

0.042%

0.019%

0.244%

2.513%

0.019%

0.008%

0.036%

0.906%

0.142%

5.395%

54-56

Professional and Business Services

0.648%

0.163%

1.216%

0.871%

0.046%

0.541%

0.410%

0.047%

0.009%

0.116%

0.335%

0.139%

0.269%

0.435%

0.236%

0.400%

3.142%

0.089%

0.510%

0.551%

0.684%

1.068%

11.925%

61-62

Education and Health Services

0.017%

0.094%

0.682%

0.251%

1.593%

0.104%

0.062%

6.252%

0.001%

0.860%

4.981%

2.442%

0.226%

0.006%

0.142%

0.394%

2.920%

1.005%

0.071%

0.135%

0.063%

0.377%

22.677%

71-72

Leisure and Hospitality

0.001%

0.081%

0.549%

0.043%

0.001%

0.003%

0.015%

0.024%

0.002%

8.200%

0.010%

0.010%

0.138%

0.000%

0.003%

0.129%

0.441%

0.541%

0.046%

0.109%

0.345%

0.242%

10.933%

81

Other Services

0.004%

0.032%

0.074%

0.115%

0.129%

0.010%

0.015%

0.060%

0.000%

0.091%

0.009%

0.023%

0.550%

0.006%

0.007%

0.065%

0.441%

0.565%

0.177%

0.035%

0.166%

0.335%

2.912%

92

Government

0.176%

0.023%

0.171%

0.555%

0.642%

0.087%

0.489%

0.172%

0.010%

0.093%

0.371%

0.108%

0.316%

0.161%

0.158%

0.188%

1.270%

0.220%

0.090%

1.416%

0.046%

0.397%

7.160%

Total Occupation Share

1.540%

0.702%

3.055%

3.437%

2.420%

1.243%

7.108%

6.577%

0.160%

9.895%

6.169%

2.769%

4.461%

0.664%

0.709%

2.216%

17.014%

2.680%

5.516%

2.383%

10.077%

51

N/A - Insufficient data available to estimate Source: Pierce County Economic Development Division analysis of data from Bureau of Labor Statistics, Quarterly Census of Employment and Wages and Occupational Employment Survey; Bureau of Economic Analysis, Local Area Income Estimates

Page 29

9.205% 100.000%

Table 17 Estimated Occupation and Industry Share of Total Wages

11-21

Total industry share

Transportation and material moving occupations

Sales and related occupations

Protective service occupations

Production occupations

Personal care and service occupations

Office and administrative support occupations

Management occupations

Life, physical, and social science occupations

Legal occupations

Installation, maintenance, and repair occupations

Healthcare support occupations

Healthcare practitioners and technical occupations

Food preparation and serving related occupations

Farming, fishing, and forestry occupations

Education, training, and library occupations

Construction and extraction occupations

Computer and mathematical occupations

Community and social services occupations

Business and financial operations occupations

Building and grounds cleaning and maintenance occupations

NAICS Industry Description

Arts, design, entertainment, sports, and media occupations

NAICS Code

Architecture and engineering occupations

Pierce County - 2007

Natural Resources and Mining

0.025%

0.000%

0.002%

0.019%

0.000%

0.004%

0.236%

0.000%

0.034%

0.000%

0.003%

0.000%

0.042%

0.001%

0.016%

0.030%

0.033%

0.001%

0.030%

0.000%

0.009%

0.081%

22

Utilities

0.058%

0.001%

0.002%

0.040%

0.000%

0.011%

0.056%

0.000%

0.000%

0.000%

0.003%

0.000%

0.215%

0.002%

0.010%

0.038%

0.099%

0.000%

0.079%

0.005%

0.012%

0.015%

0.649%

23

Construction

0.074%

0.003%

0.023%

0.182%

0.000%

0.000%

6.137%

0.000%

0.000%

0.001%

0.003%

0.000%

0.524%

0.002%

0.003%

0.342%

0.446%

0.000%

0.059%

0.003%

0.153%

0.238%

8.193%

Manufacturing

1.080%

0.050%

0.056%

0.476%

0.000%

0.235%

0.413%

0.002%

0.016%

0.024%

0.032%

0.001%

0.909%

0.010%

0.169%

0.921%

1.125%

0.001%

4.737%

0.017%

0.582%

1.192%

12.046%

Wholesale Trade

0.072%

0.024%

0.013%

0.216%

0.000%

0.114%

0.028%

0.001%

0.017%

0.003%

0.026%

0.001%

0.392%

0.003%

0.031%

0.393%

0.919%

0.001%

0.162%

0.004%

1.871%

0.986%

5.277%

Retail Trade

0.004%

0.032%

0.055%

0.119%

0.001%

0.028%

0.064%

0.004%

0.006%

0.263%

0.609%

0.024%

0.682%

0.001%

0.004%

0.302%

1.244%

0.034%

0.184%

0.044%

3.851%

0.693%

8.248% 5.133%

31-33 42 44-45 22, 48-49

0.567%

Transportation & Warehousing

0.026%

0.002%

0.027%

0.090%

0.000%

0.015%

0.040%

0.001%

0.001%

0.006%

0.006%

0.000%

0.337%

0.002%

0.003%

0.136%

1.193%

0.156%

0.042%

0.014%

0.094%

2.942%

Information

0.070%

0.222%

0.006%

0.155%

0.000%

0.266%

0.007%

0.012%

0.000%

0.021%

0.002%

0.000%

0.374%

0.009%

0.031%

0.240%

0.472%

0.022%

0.043%

0.004%

0.371%

0.049%

2.376%

52-53

Financial Activities

0.009%

0.018%

0.061%

1.962%

0.009%

0.308%

0.026%

0.003%

0.000%

0.009%

0.082%

0.004%

0.180%

0.079%

0.045%

0.899%

3.015%

0.009%

0.007%

0.030%

1.692%

0.068%

8.515%

54-56

Professional and Business Services

0.988%

0.186%

0.543%

1.437%

0.048%

0.869%

0.312%

0.044%

0.007%

0.057%

0.439%

0.078%

0.260%

0.669%

0.355%

1.280%

2.361%

0.040%

0.282%

0.261%

0.742%

0.527%

11.784%

61-62

Education and Health Services

0.019%

0.064%

0.414%

0.281%

1.422%

0.104%

0.066%

5.362%

0.001%

0.481%

8.993%

1.726%

0.202%

0.007%

0.168%

0.741%

2.121%

0.483%

0.052%

0.097%

0.053%

0.213%

23.071%

71-72

Leisure and Hospitality

0.002%

0.065%

0.211%

0.039%

0.001%

0.003%

0.013%

0.017%

0.001%

2.798%

0.008%

0.007%

0.082%

0.001%

0.003%

0.135%

0.190%

0.236%

0.019%

0.050%

0.124%

0.080%

4.085%

81

Other Services

0.005%

0.025%

0.034%

0.103%

0.084%

0.009%

0.013%

0.030%

0.000%

0.037%

0.009%

0.016%

0.391%

0.006%

0.007%

0.099%

0.228%

0.244%

0.089%

0.015%

0.086%

0.135%

1.663%

92

Government

0.286%

0.027%

0.139%

0.779%

0.682%

0.125%

0.543%

0.165%

0.013%

0.068%

0.627%

0.089%

0.381%

0.210%

0.228%

0.378%

1.122%

0.133%

0.110%

1.833%

0.036%

0.420%

8.393%

Total Occupation Share

2.719%

0.719%

1.585%

5.896%

2.246%

2.092%

7.954%

5.641%

0.097%

3.768%

10.843%

1.945%

4.970%

1.002%

1.072%

5.935%

14.569%

1.359%

5.896%

2.378%

9.675%

7.637% 100.000%

51

Source: Pierce County Economic Development Division analysis of data from Bureau of Labor Statistics, Quarterly Census of Employment and Wages and Occupational Employment Survey; Bureau of Economic Analysis, Local Area Income Estimates

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Appendix B Development Potential Index Methodology

Many factors contribute to the potential for development of a piece of property. Land can be affected in varying degrees by environmental constraints, and parcels with fewer constraints have greater potential for development. Larger parcels, in general, offer more options for development, and proximity to other developable parcels can increase those options. An index score was created for each developable parcel of industrially-zoned land in Pierce County. The index incorporates the proportion of developable land without known environmental constraints, the size of the parcel and its proximity to other developable parcels. The first step in calculating the index was to find which parcels had industrial zoning, and of those, which were fully developed. Zoning maps and development regulations for all jurisdictions within Pierce County were reviewed to find areas with allow manufacturing or assembly. Candidate parcels were then selected using Geographic Information System (GIS) software. Then, using Assessor/Treasurer parcel data, properties were classified as either vacant or developed. Next, developed properties were further analyzed to find those with the greatest potential for redevelopment. Properties were considered underdeveloped if the current use is residential and the parcel is greater than 2.5 acres, or for any use if the improvement value was less than $50,000, or if the improvement value was less than 20% of the total taxable value of the parcel. Then each parcel was verified using aerial photography to confirm that it was either vacant or underdeveloped. As a result, each parcel was classified as developed, underdeveloped or vacant. Fully developed parcels are assumed to have no further development potential, and so will ultimately have an index score of 0; underdeveloped and vacant parcels are given equal weight for the development factor. In reality, vacant land should often have a higher index score, but the circumstances surrounding each property are so individualized that the distinction was not incorporated into this analysis. Next, using GIS data, the proportion of known environmental constraints was calculated for each parcel. Constraints considered included: wetlands and associated 300-foot buffer; steep slopes; 1-percent flood-hazard area (100-year flood hazard), and; critical wildlife habitat. While many environmental constraints can be mitigated or engineered around, doing so adds cost and time to a project and therefore reduces the development potential of the land. Parcels were then standardized into 5-acre units. Five acres was chosen somewhat arbitrarily; use of a different size standard would not change the outcome in terms of ranking, only the absolute score value – the highest score would still be the highest score and the lowest would still be the lowest. A five-acre parcel, with 50 percent lot coverage, would allow construction of an approximately 100,000-square-foot building, which is a mid-sized building for industrial purposes.

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The geospatial analysis tools available in ArcView GIS software were then used to find a cluster score for each parcel. This analysis considers the number of developable parcels adjacent to the subject parcel, as well as the number of developable parcels within a given distance. The more concentrated the grouping of developable parcels, the higher the cluster score. Once all index components are found, the percentage of unconstrained area is multiplied by the number of 5-acre units and the cluster score, to get a development potential score value. Each score was then divided by the development potential score of the highestscoring parcel to index all scores to 100. Thus, the equation is:

(1 - percent of parcel with environmental constraints) x (parcel acres / 5) x (cluster score) Highest score

Adding additional components might make the index score more precise. It might be desirable to add terms for the overall size of each contiguous cluster, for contiguous blocks under common ownership and for proximity to infrastructure such as roads, sewers, water, telecommunications and industrial-grade power. Software, data and time limitations precluded the use of additional development potential factors.

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Appendix C Observed employment density by industry scatterplots Employment per Acre Industrial Parks

Employment per Acre Manufacturing

1400

1400

1200

1200 1000

Employment

Employment

1000 800 N = 25 Avg. = 18.58 R2 = 0.7712

600 400

800

N = 240 Avg. = 18.74 R2 = 0.5605

600 400

200

200

0 0

50

100

150

200

0

250

0

50

100

Acres

1400

1200

1200

1000

1000

Employment

Employment

250

Employment per Acre Warehousing

1400

N = 49 Avg. = 11.34 R2 = 0.1526

600

200

Acres

Employment per Acre Transportation

800

150

800

400

400

200

200

0

N = 14 Avg. = 5.27 R2 = 0.0027

600

0

0

50

100

150

200

250

0

Acres

50

100

150

Acres

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200

250

Employment per Acre Wholesale Trade 1400 1200

Employment

1000 800 600 400

N = 80 Avg. = 15.37 R2 = 0.3011

200 0 0

50

100

150

200

250

Acres

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