Copyright © 1998 The Seattle Times Company

                                     Business News : Tuesday, February 17, 1998
 

                                     Company rules out steel plant for Washington

                                     by Seattle Times staff and The Associated Press

                                     OLYMPIA - Nucor Steel announced yesterday that
                                     Washington state is out of the running for a new
                                     steel plant.

                                     The North Carolina-based company had
                                     considered Longview and Grays Harbor County as
                                     possible sites for a $360 million plant in
                                     Washington.

                                     Nucor, a Fortune 500 company with $4 billion in
                                     annual sales and the nation's third-largest
                                     steelmaker, also was considering Clatskanie, on
                                     the Oregon side of the Columbia River, and Coos
                                     Bay in Southwest Oregon.

                                     In December, Nucor announced that Hoquiam was
                                     no longer in the running for the steel plant that
                                     would have brought up to 500 good-paying jobs -
                                     up to $60,000 a year - to the economically
                                     depressed area. The company decided that a
                                     400-acre site on the Hoquiam waterfront, next to a
                                     federal wildlife refuge, did not have enough room
                                     to accommodate its plans.

                                     West Coast Project Manager Larry Roos said
                                     yesterday Nucor needs to build a plant in a state
                                     that can offer the company significant tax breaks.

                                     "This is especially true on the West Coast, where
                                     U.S. raw steel producers will be competing with
                                     low-priced Asian steel," Roos said.

                                     "Oregon, California and a myriad of other states
                                     have seen the benefit of trying to revitalize their
                                     rural economies and have passed tax-incentive
                                     packages to attract capital investment firms," he
                                     said.

                                     The Oregon Legislature already has passed into
                                     law a package that would translate to at least $57
                                     million in property-tax exemptions and corporate
                                     income-tax credits for Nucor over 20 years.

                                     Gov. Gary Locke proposed a set of tax breaks that
                                     were designed to match Oregon's package of
                                     incentives. The tax breaks would have started at
                                     about $10 million a year, and would have given a
                                     15-year waiver on sales taxes, a 15-year
                                     property-tax exemption and tax credits based on the
                                     number of new workers hired.

                                     Over the life of the deal, the package would have
                                     been worth more than $100 million in tax
                                     abatements to Nucor.

                                     Locke's proposal led to a debate in the Legislature
                                     about whether to offer similar tax breaks to
                                     manufacturers to bring jobs to 22 economically
                                     depressed counties. Republican leaders - most
                                     from urban Washington but some from rural areas -
                                     contend market forces, not tax breaks and other
                                     incentives, will bring jobs to rural Washington.

                                     Nucor officials said last week they were still
                                     considering Longview or Coos Bay, Ore., as a
                                     possible site. Recent news reports indicated that
                                     Nucor already had dropped Longview, and
                                     yesterday the company confirmed the decision.

                                     It was not clear whether Nucor has settled on the
                                     Oregon site. Roos could not be reached for
                                     additional comment.