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Produce Plant's Move Takes 450 Jobs : Business: Ready Pac will relocate and consolidate its operations at a larger site in Irwindale. The decision is a blow to northwest Pasadena and that city's 6-month-old enterprise zone.

April 25, 1993|EDMUND NEWTON | TIMES STAFF WRITER

IRWINDALE — Because owners of an Irwindale property made an irresistible offer, a major private employer in northwest Pasadena has elected to move, striking a blow to a state program to encourage business and jobs in that area.

Ready Pac Produce, which employs more than 450 people in its plant on North Fair Oaks Avenue, will consolidate all of its facilities within three years at a 24-acre site now owned by a health care firm, a company official said this week.

Owners of the Irwindale site, the Pharmaseal Division of the Baxter Healthcare Corp., made an offer that Ready Pac could not refuse, said Dennis Gertmenian, owner of the packing company.

"We're getting it at 30% of what it would cost to build a new facility," Gertmenian said.

Irwindale City Manager David Caretto said the prospect of a Ready Pac move was appealing enough for the city's redevelopment agency to offer to sell up to $7 million in taxable bonds for new equipment for the company.

"The (Pharmaseal) property was in a redevelopment area and it has been vacant over a year," he said.

Ready Pac managers told Irwindale officials that they would bring 700 jobs with them and the potential to expand that by 300 more positions, Caretto said.

Ready Pac's decision comes less than six months after the Altadena-Pasadena Enterprise Zone was inaugurated in northwest Pasadena, with the express purpose of giving one of the region's most downtrodden areas an infusion of economic energy.

The enterprise zone offers a package of tax and hiring incentives for businesses that operate in northwest Pasadena and Altadena--including sales tax credits on new machinery, state business tax credits on half the wages paid to workers from state training programs and tax deductions for the purchase of new equipment.

The enterprise zone opened last November in Hen's Teeth Square, a commercial complex on North Los Robles Avenue, with the top priority of bringing new jobs to the area.

"Obviously, we're sorry to see them (Ready Pac) go," said Kenneth Jackson, manager of the zone. "I think our office and the city put forth a very strong effort to try to keep them here. Ultimately it was a business decision."

Ready Pac's plans have alarmed some elements of the business community, many of whose members have complained in recent years about the city's inattention to businesses.

"We're finding that there are two levels of business opportunity at City Hall," said Jim Plotkin, owner of the Pasadena Sewing and Vacuum Center and a member of the Pasadena Chamber of Commerce executive board. "On one level, there's the City Council, which professes to want a public-private partnership and to attract business. Then we have city staff."

Plotkin contends that decisions adversely affecting businesses are made at the city's middle-management level. He said that is what happened with the city's treatment of Ready Pac, which produces packages of fresh vegetables for supermarkets and institutions.

"They never took it to the senior management people, who could have gotten more creative or gone higher up," he said.

But, countered Jackson, Ready Pac had access to both the enterprise zone staff and City Manager Philip Hawkey during meetings last year.

Hawkey said the city's main concern is the potential loss of a source of entry-level jobs. Many of Ready Pac's employees walk to work, he said, and the move to Irwindale could constitute a major hardship for them.

"I would suspect that there would be some people who would not be able to afford transportation," the city manager said.

Hawkey and other city officials said they will press to keep Ready Pac's Pasadena facility in business. Leaving the door slightly ajar, Gertmenian said he is open to proposals.

"I feel a commitment to this community," he said.

Gertmenian's family has been in business in Pasadena since 1955.

An expansion plan proposed by Gertmenian for the Pasadena site, at Fair Oaks Avenue and Mountain Street, had run into insurmountable barriers in the city's zoning codes and general plan, said Rod Olguin, city project planner. Gertmenian had proposed tripling Ready Pac's capacity on the four-acre site by adding about 150,000 square feet over the next three to five years, he said.

"Parking was the major difficulty," Olguin said.

City building codes would require the company to add about 350 parking spaces on or near the site.

"The project site just couldn't meet that goal, unless it went to subterranean parking or an above-ground parking structure," which would have been prohibitively expensive, Olguin said.

Another difficulty was the fact that the plan required taking a residentially zoned lot adjacent to the plant as supplementary parking, Olguin said. Because the city is in the midst of preparing a new general plan for state approval, most zone changes are forbidden by state law, he added.

Gertmenian said he has signed a lease with an option to buy the Irwindale plant at 4401 N. Foxdale Ave., where he will also eventually relocate Ready Pac plants in Salinas and Yuma. He said the company will invest about $18 million in the new plant over the next seven years. Operations will begin in Irwindale in June, with about 60 of the Pasadena workers moving immediately, he said.

Gertmenian said that Pasadena city staff and officials had been very accommodating to him.

"They've done everything they could to support the company," he said. "They made it very clear how important the company was to the city."

The move to Irwindale is being made purely on the basis of business considerations, Gertmenian said.

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