AFTER THE RIOT: THE SEARCH FOR ANSWERS : Businesses Watched for Signs of an Exodus

There is little evidence that last week’s rioting in Los Angeles will spur a mass departure of businesses from California, but economic development officials said the turmoil could provide the final impetus for already fed-up companies to leave.

“We’ve not had a rash of calls,” said Scott Eubanks, president of the Arizona Economic Council in Phoenix. “Nor do we get a sense of panic.”

Economic development officials outside California say they have no intention of exploiting the arson and looting as a marketing tool. Frankly, they say, they don’t need to.

Even before the riots, states such as Utah, New Mexico and Washington were reporting a brisk business in helping relocate small California firms complaining of workers’ compensation fraud, housing costs and other problems.

“We have been having a long line of inquiries from Southern California going back 18 to 30 months,” said Ken Lynn, president of the Economic Development Authority of Western Nevada in Reno.

Most such officials noted that it is too soon to tell whether the riots--as the capper to a long list of business community complaints--will spur an exodus from Southern California. “I don’t expect a lot, but the potential is there,” said Dan Pegg, president of the San Diego Economic Development Corp.

As far as Kris Holt, executive director of the Northern Nevada Development Authority in Carson City, is concerned, there is already some evidence.

Holt said his phone has been “ringing pretty good” with calls from California companies, although things have quieted down since the outburst.

In most cases, he said, the firms had already considered moving, but the riot “pushed them over the fence.”