Oklahoma Comes Looking for Work: Orange County’s : Economy: The Sooner State has set up an office to lure businesses its way by touting state’s affordability.
In the 1930s, thousands of Oklahomans rode the wind out of the Dust Bowl to California in a desperate search for jobs. The exodus, one of the greatest migrations in the nation’s history, was chronicled by John Steinbeck in “The Grapes of Wrath.”
Now Oklahoma is trying to write a new chapter in its history with California. It has opened an economic development office in south Orange County to lure Southern California businesses to Oklahoma.
While a number of western states have targeted Southern California as a good place to shop for corporate relocation candidates, Oklahoma is the first to establish a full-time presence here.
The pitch to local companies is simple: the Sooner State has less environmental regulation and pollution, little traffic congestion, lower taxes and more reasonable housing and real estate prices than Southern California.
“Because of growth pressures and other problems, some (California) companies just can’t expand locally,” said John Reid, director of marketing for the Oklahoma Department of Commerce, which overseas the office. “So they already are thinking about building new facilities elsewhere. We just want to be there to put Oklahoma on their minds.”
Oklahoma trade officials adamantly say they are not trying to take jobs and businesses from California, but rather are only attempting to entice firms to expand operations to or build new branches in their state.
“That makes it a win-win situation because we are not trying to persuade businesses to pull up and move,” said Oklahoma trade representative Jay Hudson Allbaugh, who runs the one-person office. “We don’t want to be accused of stealing jobs.”
Orange County political and business officials say the opening of an economic development office by another state is a compliment. The move is a reflection of the vibrancy of the local economy, they said.
“We should be flattered,” said Lucien Truhill, executive director of the Orange County Chamber of Commerce. “Usually these offices are opened in major cities, like Chicago, so maybe this shows that we’ve achieved national recognition as an economic center.”
The Oklahoma mission began operating here in July, but is only now getting around to publicly making its presence known. The office’s grand opening this week will be celebrated by Oklahoma Gov. Henry L. Bellmon and several other state officials.
Those officials are scheduled to meet with a number of area businesses today and Friday. The visit will be capped with a luncheon address by Bellmon to a group of about 70 local business executives at the Four Seasons Hotel in Newport Beach.
“Some of these are local business people who are from Oklahoma, or are from companies with operations in Oklahoma, and some are executives of firms we hope to develop a relationship with,” Allbaugh said.
Reid said the idea of opening a California economic development office developed from the close ties that Oklahoma and California have with the aerospace industry. “We have a lot of aerospace firms in Oklahoma with ties to Southern California, and we thought this would be a perfect place to shop for more investment in our state,” he said.
Oklahoma commerce officials soon discovered that the high cost of land and housing was combining with strict environmental controls, growing traffic woes and spot labor shortages to force a small but increasing number of firms, principally manufacturers, to either move out of Orange and Los Angeles counties or to look out of the area for expansion sites.
Some firms have already abandoned the area. Smith International Inc., an oil services firm, last year completed the relocation of its corporate headquarters and manufacturing operations from Newport Beach to Ponca City, Okla. Reid and Allbaugh said that was a move that happened without any prompting from Oklahoma.
“That kind of complete relocation happens every once in a while, and hopefully we can grab some of those (firms) that are going to leave anyway, but we are here basically looking for expansion and investment,” Reid said.
Allbaugh said he has been meeting with Southland business executives who have had previous dealings in his state or who have written the state commerce department asking for information about Oklahoma’s business relocation programs. He declined to identify any of his contacts, but said he is close to completing deals for several firms to open facilities in Oklahoma.
“My approach is to discuss the business advantages and incentives we offer. If XYZ Corp. is looking to expand, I can show how purchasing an idle plant in Oklahoma and refurbishing it and starting production would get the company certain job and property tax credits. Depending on the community it was moving into, the company might also get relocation funds and other benefits.”
The economic development efforts of Oklahoma, which has been suffering through an energy-based recession, contrast sharply with the lack of such efforts in Orange County, which has been enjoying robust growth for the past decade.
Orange County’s economic development program died in the late 1970s, after voters approved sharp limits on government spending and local governments began paring expenses. The county chamber now limits business development activity to sending out brochures about the county when requested by out-of-area businesses.
Dan Wooldridge, an aide to County Board of Supervisors Chairman Don R. Roth, said that while the county has had little difficulty attracting businesses, “changes in the county’s economy and job mix do mean, however, that certain kinds of industry in Orange County are living on borrowed time.”
Stiff new environmental regulations, soaring housing costs and other regional problems have made it difficult for many small manufacturing businesses to survive locally, and dozens have left the area in recent years.
Current projections by state Employment Development Department analysts show the county’s total growth from new employment edging up at less than 2% a year, down from annual rates of 6% to 8% in the mid 1980s.
“We may regret at some point that we have not been more active in recruiting business,” Wooldridge said, “but if you look at the attitudes in much of the county, you see that many people perceive growth to be negative.”
WHY OKLAHOMA’S OK
The Sooner State has opened a business recruitment office in Orange County--the first of its kind in Southern California. In attempting to persuade area businesses to set up shop in Oklahoma, trade representative Jay H. Allbaugh uses arguments like these:
* Corporate and personal income tax rates are 6% in Oklahoma versus 9.3% in California.
* The median single-family home in Tulsa sells for $65,000. The median in Orange County is $245,000.
* Oklahoma’s sales tax rate is 4% versus 6% in California.
* Water, electricity and natural gas all are “markedly less expensive” in Oklahoma, as are the rates businesses must pay for workers compensation and unemployment insurance.
* Oklahoma is considerably less crowded than California. It has 3.2 million people compared to California’s 29.3 million. That makes for less traffic and pollution.
