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Harpers, Citing High Business Costs, Will Move to Idaho : Local economy: The Torrance-based furniture manufacturer says all 500 employees will be invited to relocate with the firm.

August 26, 1992|NANCY RIVERA BROOKS | TIMES STAFF WRITER

In one of the largest defections of a Southland company, Harpers Inc. on Tuesday announced that it will relocate its Torrance headquarters and office furniture factory, which employ about 500 people, to northern Idaho.

Harpers, a subsidiary of Kimball International of Jasper, Ind., is moving because of "typical economic reasons," including Southern California's real estate prices, rising lease rates and the increasing costs of workers' compensation insurance, emission permits and utility rates, said Joe Wisniewski, Harpers executive vice president and general manager.

"We're profitable in California, but we will be more profitable outside of California," Wisniewski said, noting that the $7.3-billion steel office furniture market is extremely competitive.

Harpers will move its operation, which has a $15-million payroll, to Post Falls, Ida., in July, 1994, he said.

All of the company's employees are invited to relocate to Idaho "at different benefit levels," Wisniewski said. For those who elect to stay, Harpers is working with the Torrance city government to set up retraining programs, he said.

"It is a very major move," said Jack Kyser, an economist for the Economic Development Corp. of Los Angeles County, which is spearheading a drive to keep local companies from leaving town.

Although the loss of a single company has little impact on the local economy, the trend is disturbing, he said.

"It's a standard story," Kyser said. "For us, it's a flea bite. But given the state of our economy, it's more like the bite of a rattlesnake."

Harpers was courted aggressively by the economic development councils of Idaho and Washington, which a company statement touted as "perhaps an unprecedented program." Harpers' new hometown is only a short drive from Spokane, Wash.

"Alone, we could never afford to recruit Harpers," said Bob Potter, president of the Jobs Plus Inc., a nonprofit economic development organization in Coeur D'Alene, Ida. "By joining forces across communities and state lines, we were able to compete effectively against other states."

As an example of their efforts, the two states have committed "substantial vocational training funds" to develop a training program that workers must complete to be considered for employment by Harpers.

Harpers said it searched for 2 1/2 years for a new site, selecting Idaho over eight other states.

Potter said local officials were pleased with the environmental records of Kimball and Harpers, which were considered before Idaho and Washington began recruiting the company.

Harpers has been fined five times since 1987 for violating air quality emission standards, said Bill Kelly, spokesman for the Air Quality Management District. The last fine, about $15,000, was levied in January for failing to maintain records on volatile organic compounds for such things as solvents and paints, he said.

In all, the firm has paid $19,300 in fines over the last five years, Kelly said.

"We're always sorry to see a manufacturing company leave the Basin," Kelly said, "and we hope we would be able to get (Harpers) to work with us and look for a way that we could make them stay as far as . . . the air quality aspects."

Air quality standards, Kelly said, are set by the federal government, not by individual states. However, it is up to the states, California included, to enforce the standards. In the Los Angeles area, air quality does not yet meet federal guidelines, meaning new and stricter controls are being imposed.

Times staff writer Michele Fuetsch contributed to this story.

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