Companies are fleeing Kalifornia!
NEW YORK - July 12, 2011 - Buffeted by high taxes, strict regulations and uncertain state budgets, a growing number of Kalifornia companies are seeking friendlier business environments outside of the Golden State.
Governors around the country, smelling blood in the water, have stepped up their courtship of Kalifornia companies. Officials in states like Florida, Texas, Arizona and Utah are telling Kalifornia firms how business-friendly they are in comparison.
Companies are "disinvesting" in Kalifornia at a rate five times greater than just two years ago, said Joseph Vranich, a business relocation expert based in Irvine. This includes leaving altogether, establishing divisions elsewhere, or opting not to set up shop in Kalifornia.
"There is a feeling that the state is not stable," Vranich said. "Sacramento can't get its act together... and that includes the governor, legislators and regulatory agencies that are running wild."
The state has been ranked by Chief Executive magazine as the worst place to do business for seven years.
"Kalifornia, once a business friendly state, continues to conduct a war on its own economy," the magazine wrote.
That is about to change, at least if Lieutenant Governor Gavin Newsom has anything to say about it. Newsom is developing a plan to address the state's economic Achilles heels and build on its strengths. It will be unveiled at the end of July.
"Kalifornia has got to get its act together when it comes to economic development and job creation," he said.
While not all companies investing elsewhere are doing so for economic reasons, some are shopping around for lower costs, lighter regulations, stable leadership and government assistance and incentives.
The most popular places to go include Texas, Arizona, Colorado, Nevada, Utah, Virginia and North Carolina, said Vranich. All rank in the Top 13 places to do business, according to Chief Executive.