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Colorado Springs, Pueblo business development agencies travel to California to pitch relocation

June 11, 2013 Updated: June 11, 2013 at 6:20 pm
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Members of business development agencies from Colorado Springs and Pueblo will travel to California next week to try to convince companies to move to Southern Colorado.

David White, chief business development officer for the Colorado Springs Regional Business Alliance, and Jack Rink, chief executive officer for the Pueblo Economic Development Corp., will fly into San Francisco Monday. They'll meet with various corporate owners and executives in the area, tour Silicon Valley, and attend a medical device conference to tell business leaders that Colorado's lower tax and less restrictive business environment could lead to larger profits.

White and Rink also will meet with site selection specialists who help businesses executives find locations for a business to start, expand or relocate. They hope to visit at least 15 companies during their four-day trip.

White and Rink will focus on Silicon Valley companies with locations in Colorado Springs that may be willing to expand their local presence; small- to medium-size businesses that are struggling to survive in California; and medical device manufacturing companies.

Statistics show that when a company relocates, it tends to hire mostly local employees, rather than transferring the majority of its workforce, White said.

"When someone relocates they tend to hire 87 to 90 percent of their employees locally," he said.

Rink said that by accompanying White on the California trip, the two can promote a larger region with benefits that could attract more companies. He cited Trane in Pueblo as an example: While Trane manufactures air conditioners in Pueblo, it gets the majority of its sheet metal for its units from a Colorado Springs company.

"Each area has its own strengths, and we share a lot of strong business relationships," Rink said. "So, we can give companies more options and things that appeal to their business model."

But convincing California companies to move to Colorado will not be easy, despite that state's economic problems. Persuading a company to uproot and move is problem enough because of the cost and time involved, White said.

And White and Rink are not the first to try and lure companies away from Gov. Jerry Brown's state. Texas Gov. Rick Perry has visited California and other states several times, offering incentives to businesses to move to his no-income-tax, low business-tax state. While the state, Pueblo and Colorado Springs can each offer some incentives to companies that relocate here, such as tax abatements or cash payments for each job created, Colorado's offerings pale in comparison to some Southern states, such as Tennessee, Texas and Virginia, Rink said.

"There are well-documented cases where states have offered hundreds of thousands of dollars per job (created)," Rink said, "so if it becomes a bidding war, Colorado is outgunned in that."

Still, Rink and White believe their trip will be successful if they encourage larger companies to go slowly and first establish a "beachhead," rather than relocating an entire company at once. White used Bal Seal Engineering on Elkton Drive as an example. The company manufactures spring-loaded connectors for the medical and automotive industries. Bal Seal arrived in Colorado Springs in 2006 as a place to handle overflow orders from the main factory in California, White said. In December 2011, the company announced it would increase its Colorado springs staff to 80 and construct a $45 million, 135,000-square-foot plant in the city's InterQuest business park area instead of California.

"Over time," White said, "they realized it was cheaper to do business here in Colorado."

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Contact Ned Hunter: 636-0275.

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