States go head-to-head to lure businesses

By Keith Matheny, USA TODAY

Las Vegas is running ads in California warning businesses they can "kiss their assets goodbye" if they stay in the Golden State.

In New Hampshire, economic development officials pick up Massachusetts business owners at the border in a limousine and give them VIP treatment and a pitch about why they should relocate there.

Indiana officials, using billboards at the borders and direct appeals to businesses in neighboring states, are inviting them to "Come on IN for lower taxes, business and housing costs."

As states struggle to keep jobs in a continuing recession, they are no longer hoping businesses in other states happen to notice their lower taxes, cheaper office space and less-stringent regulations. They are taking the message directly to them and taking shots at their neighbor's shortcomings.

"It's 'I win, you lose,' " said Philip Kotler, a marketing professor at Northwestern University's Kellogg School of Management in Illinois.

No one does it more unapologetically than the Nevada Development Authority. The agency has picked on California before, but its $1 million campaign, launched this month, ratchets up the mockery of California's budget deficits and IOU paychecks. "It's all done tongue-in-cheek. But the underlying deal is, we want this business," Nevada Development Authority President and CEO Somer Hollingsworth said.

Last week, California Assemblyman Jose Solorio launched a countercampaign.

"They do mask the nastiness of their message with humor, but this time, their ads are over the top," said Solorio, a Democrat from Santa Ana.

"What happens in Vegas stays in Vegas, but what happens in California makes the world go 'round," California's response ad states.

New Jersey's efforts to lure business from New York are as much defensive as they are offensive, New Jersey Gov. Jon Corzine said. "It's a shrinking pie, obviously," he said.

Kathryn Wylde, president and CEO of Partnership for New York City, a non-profit group, says New York can't pay everybody to stay in New York, "but New Jersey can pay them to come and create a new job."

Matheny reports for The Desert Sun in Palm Springs, Calif.