Study Cites Taxes, Red Tape as Reasons Firms Leave State

Results of a recent survey funded in part by San Diego Gas & Electric confirm that companies leaving San Diego County do so largely because of California’s heavy tax burden, regulatory red tape and a general climate that is perceived as hostile toward business.

The survey, which included interviews with executives at 1,035 California-based firms that opened new operations out of state between 1980 and 1991, incorporated responses from 120 San Diego-based companies.

The survey suggests that out-of-state moves and expansions resulted in the loss of 92,000 jobs statewide between 1980 and 1991. SDG&E; has yet to determine how many jobs were lost locally through moves or out-of-state expansions, Breed said.

While the survey wasn’t all-inclusive, it verifies complaints voiced by individual companies that are moving all or part of their operations out of the state, said Kelly Cunningham, a research analyst with the Greater San Diego Chamber of Commerce’s Economic Research Bureau.

Major reasons for firms’ outward migration included:

* High business costs, which were cited by 66% of company executives interviewed.

* A hostile attitude among California’s regulators and elected officials, according to more than 60% of executives.

* Ineffective bureaucrats, who, according to more than half of executives surveyed, hinder businesses’ attempts to do business in California. In contrast, more than half of the executives interviewed claimed that agencies in other states actually helped them to do business.