Simi Offers $175,000 to Lure Firm From L.A. : Economy: City officials are unsure if the bonus will be enough. The medical supplies company would bring 470 jobs.

Facing tough economic times and growing competition from other cities trying to increase their tax bases, Simi Valley officials have offered a $175,000 cash bonus to entice a San Fernando Valley medical supply firm to move to the city.

On Tuesday, however, city officials said they were still uncertain whether the bonus, the city’s first such offer, will be enough to persuade Guardian Products, a medical supplies manufacturer, to move its corporate offices, plant and 470 jobs to Simi Valley.

The money is less than half of the $400,000 that Guardian Products, which also is weighing offers from cities outside California, requested from the city’s redevelopment agency Monday night.

“We gave them as much as we thought we could give,” Mayor Greg Stratton said of the Community Development Agency funds. “We hope it’s enough.”

The city’s redevelopment agency in the past has lured new businesses by building roads, water tanks and other improvements that cost more than the $175,000 offered to Guardian. But Simi Valley officials said cash bonuses are becoming the more common bait in a highly competitive business climate.

“If it’s not the wave of the future, it’s certainly going to be the trend in Southern California for some period of time,” Councilman Michael W. Piper said.

Stratton agreed. “When Simi Valley was relatively inexpensive land-wise, that was enough of an inducement,” he said. “Now, we find we need a little more.

“The competition is getting stiffer,” he said. “Somebody told me the state of Colorado is offering a thousand bucks a job to companies that relocate. There is a recession. So I do think it requires a little extra ‘oomph’ to get people to relocate. If times are tough and the competition keeps up, we’re going to have to keep doing it.”

Guardian, now located in Arleta and North Hollywood, is a leading maker of products for the disabled and elderly, including crutches, walking aids, wheelchairs and patient-lifting equipment. The firm is considering moving to Peppertree South Business Park on the east side of Tapo Canyon Road south of the Arroyo Simi.

Simi Valley officials say Guardian is a non-polluting business that would bring new jobs, new shoppers and possibly new home buyers. As the first major tenant in a new industrial park, it could attract other new employers to the site, city officials said.

Simi Valley could not afford the full $400,000 that Guardian requested because of existing redevelopment debts.

“That was all that we felt the city could safely use as an inducement to get them out here,” Councilwoman Judy Mikels said. “As much as we need those kinds of businesses here, we can’t give away the store.”

The $175,000 bonus would come from the redevelopment agency’s share of higher tax revenues collected as the industrial property becomes more valuable. City officials said the money would help Guardian pay many of its planning, building permit, sewer connection and water connection fees--together expected to cost $201,773.

Guardian President Robert B. Senn said Tuesday that he was still reviewing the city’s offer and had no comment on it. He said no decision had been made on relocation.

Barry Rosengrant, chairman of Metrospace Corp., a relocation consultant hired by Guardian, said financial aid was only one of the factors being weighed by Guardian. He said a final decision is expected to be made in the next few weeks.

“Our recommendation continues to be Simi Valley if the economics work for our client,” he said. “It’s down to a simple economic decision.”

When Guardian began to consider relocating, it received unsolicited offers from the states of Texas, Tennessee and Iowa, Rosengrant said. Anxious to attract new industries, these states offered tax breaks and help with relocation costs. Simi Valley lacks the authority to offer income or property tax rebates, city officials said.

Simi Valley does, however, have a desirable location. Its proximity to Los Angeles is an advantage in shipping products, obtaining raw materials and obtaining special engineering help, Rosengrant said.

One drawback is that workers’ compensation insurance costs much more in California than in most other states, he said.

Rosengrant said Ventura County officials have offered nothing more than “a warm handshake” to encourage Guardian’s relocation. But state officials, who are anxious to keep businesses from fleeing California, may provide some financial aid, he said.

In February, Everest & Jennings International, a Camarillo-based wheelchair manufacturer, announced that it would move its corporate headquarters and manufacturing operations to St. Louis this summer, laying off more than 450 employees. Company officials blamed the high cost of doing business in California and cited the multimillion-dollar incentives offered by Missouri officials.

Guardian requested $400,000 in part to cover its remaining San Fernando Valley leases, which run through February, 1994. The firm has told city officials that if it was to make the move, it would prefer to relocate to Simi Valley as soon as its new building is completed--well before the current leases expire.

Woodland Hills-based Peck/Jones Builders has already designed a two-story, 120,000-square-foot structure that would be built for Guardian if the company moves to Simi Valley, said Jim Collar, president of the building firm. Peck/Jones’ parent corporation is co-owner of the industrial park.

Collar said he hopes that Guardian is satisfied with the $175,000 bonus. “I thought the city went as far as it could,” he said. “We were very pleased.”