Sunday, November 7, 2010
Peninsula Daily News
Carbon fiber plant may double in size Gregoire says the facility could be largest in world The Associated Press
OLYMPIA — Gov. Chris Gregoire said the new carbon-fiber plant being built in Moses Lake may double in size because of strong demand by the German carmaker BMW. Gregoire is returning
from a three-day trip to Germany, where she met with executives of BMW and SGL Automotive, a European carbon manufacturing company. The two companies have a joint venture that is building a plant in Moses Lake to produce the composite
material for BMW’s new electric car. In a statement Friday released by her Olympia office, the governor said that BMW thinks the composite can be widely used throughout its automotive line, but it can’t get enough of it. She said she expects that directors of the two companies will decide on the expansion early next year. If it goes through, she said, it would result in the largest carbon-fiber manu-
Agriculture is still the major business for Moses Lake and surrounding Grant County. But low hydropower rates are drawing an increasing number of hightech companies, including a plant to make solar cell materials and several electricity-intensive computer server farms. BMW and SGL also are interested in a potential partnership with the Uni-
facturing plant in the world, with some 160 permanent jobs. The $100 million plant initially will employ 80 workers. It now supports about 200 construction jobs. Depending on their application, carbon fiber composites can be lighter, stronger and far more durable than many metals. Boeing Co.’s new 787 jetliner is mostly made out of the material.
versity of Washington for carbon fiber research. The school presently is home to the Automobili Lamborghini Advanced Composite Structures Laboratory, which does basic research for the Italian carmaker, Boeing and other companies. During her trip, Gregoire also met with German Chancellor Angela Merkel to promote trade and business ties.
Pierce Commercial is 11th bank to fail Construction lending leads to big losses Peninsula Daily News news services
TACOMA — Pierce Commercial Bank, closed by regulators Friday, is the 11th bank to fail in the state this year — a victim in part of losses from massive mortgage fraud. Heritage Bank of Olympia agreed to acquire all of the Tacoma bank’s deposits and essentially all of its assets from the Federal Deposit Insurance Corp., officials said. As of Sept. 30, the onebranch bank in Tacoma had $221.1 million in assets and $193.5 million in deposits. The Pierce Commercial failure was a combination of heavy losses from lending in both construction and mortgages, said Brad Williamson, banking director for the state Department of Financial Institutions. Federal agencies are conducting a criminal investigation of mortgage losses at the bank.
Bellevue wire fraud In September, a Bellevue resident, Mark Ashmore, was convicted in federal court in Seattle on four counts of wire fraud and conspiracy in connection with a mortgage-fraud scheme against Pierce Commercial and other lenders. And in a civil lawsuit filed last summer, prosecutors asked a judge to order Shawn Portmann, the senior vice president of Pierce Commercial’s mortgage-lending division from 2005 to July 2008, to turn
Confessions of a Restaurateur By Bushwhacker Bob
over $102,000 in cash that he allegedly handed to an associate in a bag early this year. The suit disclosed that the FBI began investigating the bank’s home-lending division in June 2009. According to the lawsuit, the FBI concluded that Portmann alone originated 5,253 loans for more than $990 million — nearly half of the mortgage-subsidiary’s total — and that more than half of the loans were fraudulent. “It was a big contributor to the downfall of the bank,” Williamson said Friday. Portmann has not been charged with any crimes, and has denied all allegations in the civil case. His attorney could not be reached late Friday. The FDIC held an auction for Pierce Commercial about two weeks ago, and four banks submitted bids, said Greg Hernandez, an FDIC spokesman. Heritage is paying a premium of 1 percent to assume all of Pierce Commercial’s deposits. The estimated cost to the FDIC fund is $21.3 million. Heritage reported about $855 million in assets and nearly $720.2 million in deposits June 30. The bank has 15 branches, none of them on the North Olympic Peninsula.
Peninsula closures Williamson said that this latest FDIC deal is the first in Washington state where the entire bank is passing to the acquiring bank, with no assets or brokered deposits being retained by the FDIC. Regulators closed three other banks Friday — in Maryland and California — bringing the year’s toll to 143 and topping last year’s 140. The 143 closures so far this year are the most in a year since the savings-andloan crisis two decades ago.
The last bank closure on the North Olympic Peninsula was April 30, when Frontier Bank’s three branches in Port Angeles, Sequim and Port Townsend — and 47 other offices in Washington and Oregon — were shut down by regulators after Frontier had struggled for more than a year with a morass of soured real estate loans. Frontier’s banks reopened May 2 as branches of San Francisco-based Union Bank. Two other banks with Peninsula branches have been closed since last year — Bainbridge Island-based American Marine Bank, taken over Jan. 30 by Tacomabased Columbia Bank, and Bremerton-based Westsound Bank, closed May 9, 2009. Westsound’s accounts were assumed by Kitsap Bank.
Sterling Savings Bank The parent company of Sterling Savings Bank recently raised $730 million from private equity and institutional investors, a milestone that helps the state’s second-largest bank avoid being seized by regulators and sold to the highest bidder. Sterlingoperatesbranches in Port Angeles and Forks. The growing bank failures have sapped billions of dollars out of the FDIC’s deposit insurance fund. It fell into the red last year, and its deficit stood at $15.2 billion as of June 30. The FDIC expects the cost of resolving failed banks to total around $52 billion from 2010 through 2014. Depositors’ money — insured up to $250,000 per account — is not at risk, with the FDIC backed by the government. That insurance cap was made permanent in the financial overhaul law enacted in July.
JIM & JOANNE HALLETT HALLETT AND ASSOCIATES LIVE UNITED
Thank Goodness for Speech One of my favorite memories from the Bushwhacker happened years ago. I wasn’t even there. I go to a yoga class at Park View Villa. One of the women came up to me after a class and said, “Bob, were you there the night of my husband’s 75th birthday? He had become blind in his 50s and his world changed dramatically. I gave him a surprise birthday with balloons and everything at your restaurant. The dinner and party were a great success. He wanted me to describe everything. The color of the balloons, the look on people’s faces. He was lit up with joy. Afterwards he said that it was the most fun he’d ever had in his life!”
The Associated Press
in the world?
Workers raise the crowned head of a statue of Jesus Christ on Saturday before placing it onto the figure’s body in Swiebodzin, western Poland. The 118-foot statue is supposed to attract pilgrims and boost business. Its creators say it’s the world’s biggest Jesus statue.
Tax credit increases, extends through 2011 Peninsula Daily News
Section 179 Tax Credit
Local business and tax advisers are telling companies to consider making software or equipment purchases before the end of the year. A business tax credit for buying equipment, which was set to expire Dec. 31, has been increased and extended through 2011 with the recent passage of the Small Business Jobs and Credit Act. But additional benefits are now available to those who take advantage of the credit this year. Businesses can now deduct up to $500,000 from their federal income taxes for equipment and software they buy or lease and then put into service under Section 179 of the tax code. The new credit is double what the law allowed when limits were increased under former President George W. Bush’s Economic Stimulus Act of 2008 and President Barack Obama’s extension of the act in 2009. Businesses that spend more than $2 million on equipment for the year aren’t eligible for the full deduction.
n What it is: A business tax credit for buying or leasing equipment and putting it into service during the same year. n How it works: Profitable businesses can deduct the credit on their tax returns to reduce taxable income. n What changed: The tax credit limits were increased, and the program was extended until Dec. 31, 2011. n Old tax credit: Up to $250,000 for businesses that spend less than $800,000. n New tax credit: Up to $500,000 for businesses that spend less than $2 million. n For more information: http://www.irs. gov/publications/p946/ch02.html#d0e1927. Peninsula Daily News But that limit, too, has increased. Previously, the full deduction was available only for companies spending more than $800,000. Those that spend more than the limit can still claim a reduced tax credit. For details, consult the IRS or your tax adviser. Raising spending limits and boosting the maximum tax credit has made more medium-size to large businesses eligible to take advantage of the credit in 2010 and 2011, said Ryan Greear, a tax manager at
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I wasn’t there that night, but thank goodness he... and her family were. “Be kind to yourself and each other” Bob G.
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the Frumenti, Lander & Wallace accounting firm in Vancouver, Wash. It is less meaningful for small businesses, since so few spend several hundred thousand dollars on equipment in a year, he said. The 2011 tax credit extension also means those businesses that don’t have the cash flow to make equipment investments in 2010 can still benefit from a tax break next year, Greear said. Without the recent vote, the credit would have reverted to its original limit, allowing companies spending less than $200,000 to receive a credit of up to $25,000. Business consultant Albert Christensen is advising his clients that have been profitable in 2010 to buy or lease equipment before the end of the year to benefit from the extra cash in 2011 for hiring and expansion purposes. “Now’s the time to make your investment if you’re in a position to,” said Christensen, a contract chief financial officer in Vancouver with Phoenix-based B2B CFO. Especially “if next year is looking like a better year,” he said. It is uncertain whether the larger tax credits will spur new spending, however, even though that’s exactly what Congress hoped for when it extended and increased the tax credit.