COMMENTARY ON THE BUSINESS CLIMATE : California Needs to Get Into the Competition for Companies : Other cities should follow the lead of Orange and others that have started programs to curb the exodus.

Representatives from 28 states recently convened at the Anaheim Marriott hotel, but they were not there to nominate candidates. Their mission was to get Orange County companies--and the jobs they provide--to relocate. And these visitors to our community didn’t arrive empty-handed.

Some of the offerings included cheap land, dollars for employee training, no income taxes, no corporate taxes, lower utility costs and an attitude that says we want you to be part of our community and will forge a partnership with you for our mutual success.

Their market were companies plagued by obscene workers’ compensation costs bloated by fraud and abuse, government regulation and red tape, traffic congestion and high living costs. And they may have been right on target.

Discussions with business leaders indicate that there is plenty of dissatisfaction with the business climate here and that it is becoming increasingly difficult for executives to turn a deaf ear to these out-of-state offers.

“In recent years, I have witnessed a profound shift of government from a provider of services to an entity that is regulatory and punitive,” I was told by an executive of one Orange County firm with 160 employees.

Not long ago, this company embarked on a $300,000 building renovation which says to the community that it has long-term plans to stay. But rather than helping to facilitate the initiative of that employer, the local city staff insisted, among many things, that the company include a sidewalk in its renovation plans at considerable extra expense. The sidewalk would have come from nowhere, gone to nowhere, and served no one.

Although the directive to build the sidewalk to nowhere was ultimately reversed by the City Council, the building renovation was delayed for more than 30 days at considerable expense to the company.

An Orange County company that has been recruited by Spokane, Wash., Boise, Ida., and the states of Nevada, Arizona, Kentucky and New Mexico was recently visited by an inspector for the South Coast Air Quality Management District. During his inspections, the AQMD representative came upon a new air-filtration system recently purchased by the company but not yet installed.

Rather than offering the company credit for taking the initiative to upgrade its efforts to clean the air, the company was told it must purchase a permit for the new system.

An Orange County printing firm which at the time employed 11 people spent $9,000 to get permits for five printing presses from the AQMD.

Less than a month after paying for the permits, the firm was billed an additional $2,000 for annual licenses. The owner requested a fee review form from the district and, at the time he testified before the Special Commission on Air Quality and the Economy, he had waited two months for the form with no response from the district.

The printing company now employs nine.

Peter Ueberroth, chairman of the Council on California Competitiveness and more recently Rebuild L.A., was quoted as saying that California has developed the most highly tuned, finely honed job-killing machine that this country has ever seen.

Executives of as many as one-third of the businesses in the state are considering moving out of California or expanding operations elsewhere, according to surveys and polls.

States spend an average $19 million each year to attract companies to relocate. Nevada has budgeted $400,000 to recruit in California.

It is unrealistic, with our state and local governments’ budget woes, to expect our cities, the county or the state to compete financially with many of the offers being made by these out-of-state recruiters.

However, a start can be made to counter these attractive offers by eliminating adversarial attitudes by government officials and bureaucrats and by initiating local efforts to improve the business climate.

It is encouraging to know that a few Orange County cities have launched efforts to do just that. They are reaching out to determine what problems their businesses are encountering, demonstrating their concern and working with the firms to solve the problems.

Brea and its Chamber of Commerce have launched an effort to retain its business base by working together to eliminate red tape.

In Orange, the City Council has created a committee to develop specific programs to curb the exodus of business and to lure new ones.

Santa Ana has one of the most aggressive economic development programs under way in Orange County. A city department with participation from the business community works full time to retain Santa Ana businesses and to attract new ones.

These initiatives to retain business should be models for other cities and districts if they are serious about helping foster economic vitality in their communities.

They may not have the budgets that others possess, but they have recognized the situation and have the right attitude. That is the first step.