Battle of the State Billboards

Gov. Arnold Schwarzenegger’s bid to drum up business for California with a national billboard campaign has inspired a call to arms.

Nevada and Massachusetts, two of the states where billboards promoting California went up in August, are firing back. Last week, big signs featuring a picture of Massachusetts Gov. Mitt Romney appeared in Los Angeles, San Francisco and San Diego. The message: “Smaller muscles, but lower taxes! Massachusetts means business.”

That is a response to a billboard in Boston proclaiming, “Arnold Says: ‘California Wants Your Business.’ (Actually, he says, ‘Kah-li-fornia.’).” Schwarzenegger is pictured with arms folded, sporting a California state flag T-shirt.

“Gov. Romney was annoyed when he saw that, so we decided to put up our own billboards in California,” said Shawn Feddeman, Romney’s press secretary. “We take these encroachments very seriously.”

Whether such campaigns actually influence corporate decisions is debatable. What’s certain is that more are on the way.

A Nevada economic development coalition plans to plaster buildings in Los Angeles, San Francisco and Sacramento with so-called wall scrapes featuring images of beaten and bruised workers and posing the question: “Will your business be terminated?” One of the 80-by-20-foot wall scrapes is scheduled to debut Wednesday at the landmark corner of Hollywood Boulevard and Vine Street.

Members of the coalition say the scrapes are designed to highlight Nevada’s lower tax rates and utility and workers’ compensation costs. They insist that they don’t intend to irk Schwarzenegger, who displayed about as much tact as Conan the Barbarian when he pulled into the Las Vegas Strip in August with a moving van in a bid to lure away Nevada businesses.

“I don’t want to annoy him,” said Chuck Alvey, president of the Economic Development Authority of Western Nevada. “I’ve seen what he does to people in the movies.”

In addition to Las Vegas and Boston, the Schwarzenegger ads have gone up in Atlanta, Dallas, Phoenix, Portland and Seattle, among other cities.

Not every state has felt compelled to participate in the battle of the billboards. “We certainly understand Gov. Schwarzenegger’s desire to encourage businesses formerly of California to move back,” said Robert Black, a spokesman for Texas Gov. Rick Perry. “However, they said, ‘Hasta la vista, baby,’ to California, and I don’t think they’re going to be changing their minds.”

Nevada officials count 37 California companies that either relocated or expanded operations to the Silver State during the 2003-04 fiscal year, resulting in 1,500 jobs. Mark Mosher, executive director of the California Commission for Jobs and Economic Growth, the nonprofit behind the California billboard campaign, couldn’t provide similar statistics for California. However, officials note that Schwarzenegger himself helped Lynch Sign Co. move its printing operation from Las Vegas back to La Verne last month.

Schwarzenegger’s movie-star status may give California an edge, said Mike LaTour, chairman of the marketing department at University of Nevada, Las Vegas. But, LaTour said, the governor is fighting an uphill battle when it comes to delivering substance: Nevada has no corporate income tax, no personal income tax and no inheritance tax.

Those factors, in addition to lower housing costs, figured in Bruce Cowan’s decision to move his company, Acclaim Electronics, from Carlsbad to Las Vegas last year.

“I saved 40% in taxes and business-related expenses by moving here,” Cowan said. “By the way, there’s no smog in Vegas and my commute is only 4 1/2 minutes a day and I’ve got a killer, custom home in a guard-gated community on a half-acre.”

California’s superior weather, public university system, access to capital and international shipping connections put the state at a natural advantage over Nevada, Mosher countered.

“Think of it in terms of a scoreboard,” he said. “California ports, 11; Nevada ports, 0.”

Schwarzenegger’s supporters also note that the governor has improved California’s business climate by tackling hefty issues including workers’ compensation, litigation against employers and the state budget.

“The people I talk to are very supportive of the governor’s agenda to create jobs,” said Allan Zaremberg, president of the California Chamber of Commerce. “They certainly aren’t anxious to move out of California.”