By Eric Jay Toll for The Arizona Builder’s Exchange
“We’re getting a lot of traction on this,” reports Melissa DeLaney, director of communications for the Greater Phoenix Economic Council. She’s referring to GPEC’s offer to bring 50 California-based CEO’s into Arizona to find new corporate headquarters following California’s hefty voter-passed tax increase. In fact, DeLaney says, the “first 50” is now “first 100” CEO visits.
“This is new ground for GPEC,” she explains. “We’re normally dealing with CFOs or relocation project teams when companies are exploring relocation or expansion into the area. This time, we’re working face-to-face with CEOs.” More than 50 companies jumped on the offer when it was first promoted November 7th, the day following California voters upping sales tax a quarter percent and increasing income taxes on earnings over $250K.
Although GPEC is not actively marketing the business recruitment effort, reaction in California and national media stirred significant response. “We have more than a dozen businesses we’re scheduling right now,” confirms DeLaney. “It’s going to take time, because we’re investing one-on-one time with busy CEOs.” The actual site tours could stretch out over six to nine months because of the high level of interest.
Most of the queries have come from Southern California—which has long been a prime source for Arizona relocations. The interest comes from some of the Golden State’s top innovators and entrepreneurs. This GPEC effort is to move the executive suites across the Colorado River, not just a new branch office or division. Companies in technology and life science fields—Arizona’s dream recruitments—are expressing serious interest.
There’s interest from Silicon Valley in the Silicon Desert as well. GPEC President and CEO, Barry Broome touts a surge in California investment into Arizona. However, with most of the activity focused on a new branch, satellite office, or a new division, the economic development promotion organization sees California’s Proposition 30, the voter-approved source of the tax hikes, as an opportunity to recruit higher level defections.
Companies with sizes ranging from 30 to 10,000 employees have expressed interest in the free trip offer. This is not a meet-and-greet effort by GPEC. The approach is to take full advantage of the face time with CEOs. Visiting CEOs will be briefed in depth on business-specific advantages of relocation, meet with local CEOs and a regional asset tour.
The program is open to California-based CEOs at high technology firms, corporate facilities with 200 plus employees or emerging technology companies with compelling intellectual property. The organization’s phones have been buzzing with serious queries.
Comments reaching GPEC from California have been, as expected, less-than-complimentary. However, some Southern California and Silicon Valley business organizations have expressed understanding at the effort and California business reaction to the offer. So far, no other state economic development organizations have so publicly jumped on the bandwagon.