Brewer Has Some Advice for States Trying to Lure Businesses--Return Their Calls

Anthony Grasst, the executive in charge of finding new locations for the expanding, Seattle-based Redhook Ale Brewery, has some advice for states trying to lure businesses: Call them back.

New Hampshire officials, including Gov. Stephen Merrill, did just that and the courting paid off.

Come spring, the 13-year-old Redhook microbrewing firm, which has sales growing at an annual rate of 40% a year, will break ground on a new 24-acre brewery at a former Air Force base in Portsmouth.

The brewery, which expects to make a quarter million barrels of beer a year, will employ about 60 local people. It projects sales of $40 million and expects to make a net profit as high as $10 million.

Grasst, in a phone interview with Reuters, said he considered all mid-Atlantic and New England states in selecting the new site for the brewery. He scratched one state immediately when “the first time I called, they hung up on me.” He declined to name the state.

By contrast, Grasst had no problems with New Hampshire’s countrified bureaucrats. “It may be as simple as how nice people were over the phone,” Grasst said.

Redhook was also attracted by New Hampshire’s low taxes, a low 7% levy on business profits and no taxes on inventory, machinery, sales or personal income.

In the rivalry between states to attract new grass-roots businesses, New Hampshire’s main weapon is cheap--no giveaways, credits or incentives.

“It’s not what we give you, but what we don’t charge you,” said William Pillsbury, director of New Hampshire’s Office of Business and Industrial Development.

The plan’s payoff is lower corporate taxes, down a point from last year. Yet income from this source is up 13% above estimates as a result of new businesses that have started up in the state, according to Merrill’s spokesman James Rivers.

New Hampshire saw 2,268 new companies start up in the state and 6,101 new trade name filings between January and November this year, compared with 2,276 startups and 5,795 trade name filings in the same period of 1992.

Even so, New Hampshire needs additional revenue--mainly generated by taxes on hotel rooms, meals and liquor--to make up an expected $24-million deficit in its $333-million budget.

That has involved cutbacks on public projects and all around the state are signs of how badly it needs additional businesses: Elderly and low-wage workers in rundown trailer parks, a high number of unsafe bridges and roads and boarded up buildings, desperate for new business tenants in many of the major cities.

With its mountains, lakes, ski areas and attractive seacoast, coupled with low crime and unemployment, New Hampshire was named the most livable state in the nation three out of the last four years by Morgan Quitno Press.

Jeanne Dietsch, 42, closed her New York City consulting firm in 1985 and transplanted herself to Peterborough, N.H., the town portrayed in American playwright Thornton Wilder’s classic “Our Town.”

Still idyllic, Peterborough is now a computer hub and Dietsch started ActivMedia, a small firm advising others how to use the Internet and supplying computer programs for marketing. She admits the state’s natural beauty was part of the attraction.

“Certainly looking out a window at Mount Monadnock is more appealing than looking out at a brick wall,” said Dietsch, a mother of two who is on the local school board. “The first thing a colleague of mine from New York does when she visits is go out at night and take a walk. That’s worth a lot of money.”

Cabletron Systems Inc., which had revenue of almost $600 million last year, up from $58 million in 1989, relocated to Rochester, N.H., from Massachusetts in 1983.

“We made the right decision,” Craig Benson, Cabletron’s chairman and chief executive officer, told Reuters.