It's not the authority's first foray into Sacramento. The group
made a similar trip in March 2006 as part of a prior marketing
assault. But things are different this time, said Somer
Hollingsworth, the authority's president and chief executive
officer.
"The California economy is in worse shape than it was the last
time we were here," Hollingsworth said. "The state, the individual
cities, they're upside down by billions and billions of dollars on
employees' health insurance and retirement benefits. There's a $16.5
billion deficit. The numbers become so gigantic that you look at
them and say, 'There's just no way this is going to work.'"
The authority's marketing effort has already caught the eye of
California officials and media.
California Sen. George Runner, R-Lancaster, flashed the group's
newest ads during a hearing of the state Legislature's Revenue and
Taxation Committee earlier this year to show how California's tax
policy is encouraging poaching from economic developers in other
states.
The Los Angeles Times wrote an article on the controversy, noting
that the ads touched "nerves on both sides of the tax-hike
issue."
Versions of the Times story also appeared in the Chicago Tribune
and the Orlando Sentinel.
"Unfortunately, this Legislature is asking for these types of
advertisements," Runner told the Times.
The authority garnered additional attention with its promotional
blitz Tuesday in Sacramento, where the authority had a team of
street performers handing out the Gummy Bears, T-shirts and fliers
listing "Sweet 16" reasons to move to Nevada.
The purpose isn't merely educational, though. Authority officials
hope to rustle up additional looks from the media.
"We want to get as close as we can to the source and see if we
can't get some more press out of it," Hollingsworth said. "And you
can't get much closer for publicity than on the sidewalk in front of
the governor's office."
Hollingsworth estimated he did interviews with five or so media
outlets Tuesday.
Barbara Hayes heard one of those interviews on the radio in the
morning as she was out of her Sacramento office on business.
"It was a pithy little interview," said Hayes, executive director
of the Sacramento Area Commerce and Trade Organization. "I don't
think it's anything that's going to cause anybody to pick up a
company and move. Companies make decisions based on facts, numbers
and evaluative criteria. If this gets someone thinking, then mission
accomplished. But as far as resources being used, to be in front of
the Capitol or on morning radio, I'm not sure it's going to reward
them in the way they want."
Most of the foot traffic outside the Capitol comes from school
field trips, tourists and legislators -- not demographic groups who
are exactly poised to move a business, she said.
Hayes acknowledged that Runner's comments before the California
Legislature made a point. She said she hoped Runner's arguments
served as "a wake-up call" regarding California's tax rates and
business costs. But she added that higher taxes in the Golden State
"aren't even on the table for discussion right now."
Plus, the quality of work force is the biggest driver of
corporate-relocation decisions, she said, and in that area,
California handily beats most states.
Allan Zaremberg, president and chief executive officer of the
California Chamber of Commerce, agreed that business owners consider
factors beyond taxes when they're deciding where to locate a
company.
"Our access to ports, a vastly superior work force, a tremendous
system of higher education and a great quality of life keep us
competitive," Zaremberg said. "As well, California has a
substantially larger and wealthier consumer base market than other
states."
Even as the authority takes a magnifying glass to California's
flaws, Nevada is yielding its own share of troubling headlines.
A local endoscopy clinic forced the largest-ever public
notification of patients who might have been exposed to hepatitis C
after health investigators witnessed improper injection practices
there.
What's more, several petitions to raise gaming taxes are
circulating, and some casino operators have responded to the ballot
questions with renewed calls for a broad-based corporate-income
tax.
Hollingsworth said neither issue has yet proved a deal-breaker
for prospective new companies.
No companies working with the authority to move to Las Vegas have
asked him about the hepatitis alert, he said, and Nevada is far from
the only state scrambling for revenue. And in its $900 million
difference between state budget and income, Nevada pales in
comparison to California, he noted.
"Every state is looking at taxes and what they should or
shouldn't do, and how they can still be business-friendly,"
Hollingsworth said. "It is something we have to answer. We tell
people our problems are no different from anyone else's, but we've
got this really good, business-friendly structure in place, and
we're doing what we can to keep it."
The authority has placed nearly 10 of its bear cartoon ads. It's
drawn up 40 spots and will spend about $1.5 million in the next few
months to place the ads and coordinate related events in the next
few months.
Contact reporter Jennifer Robison at jrobison@reviewjournal.com
or 702-380-4512.