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Texas governor woos Vernon businesses

'If California doesn't want your business, Texas does,' say his emails to employers in Vernon. They say a state Assembly bill could eliminate many of the tax and operating-cost advantages they enjoy.

May 09, 2011|By Marc Lifsher, Los Angeles Times
  • Vernon businesses include food processors, apparel makers and other manufacturers.
Vernon businesses include food processors, apparel makers and other manufacturers. (Robert Gauthier, Los Angeles…)

Reporting from Sacramento — Texas Gov. Rick Perry, the Lone Star State's recruiter-in-chief, is aiming to take advantage of a political fight over the future of the tiny industrial city of Vernon.

Perry has sent dozens of emails to some of Vernon's approximately 1,800 employers, telling them that a bill backed by California Assembly Speaker John Perez could eliminate many of the tax and operating-cost advantages they enjoy in the manufacturing enclave southeast of Los Angeles.

"As the state of California continues to support legislation that causes undue burden and taxation on companies doing business in the Los Angeles area, I invite you to consider your future in America's new land of opportunity: the state of Texas," Perry wrote.

"If California doesn't want your business, Texas does."

He noted that Texas "has no personal income tax, and there's no interest in getting one."

Perez's bill would strip Vernon of its city charter because of what he has called an "unprecedented pattern of corruption" in the city of fewer than 100 residents, which has been controlled for the last century by a small group of family members and their allies.

Business executives in Vernon, who have been waging a battle against the powerful Democratic speaker from Los Angeles, say they just might be interested in what Texas has to offer.

"Texas is reaching out to the companies that are here that might be interested in moving," said Jose Gavina, vice president of F. Gavina & Sons Inc., a large family-owned coffee roaster with customers nationwide. "I would love to be able to stay here, but we need to move where it's best for the company."

Gavina, whose family fled the Cuban revolution in the 1960s, said he and other business executives are hoping to persuade members of the state Senate or the governor to kill the Perez bill, which has already cleared the state Assembly on a bipartisan vote.

Perez said he was committed to both fighting corruption in Vernon and preserving Vernon's pro-business climate. "Speaker Perez is fighting to protect jobs and businesses threatened by Enron-style corruption in that city," spokesman John Vigna said.

Perez staffers are putting together proposed amendments to the bill, AB 46, that would maintain Vernon's current industrial zoning, keep electric rates low and maintain high-quality fire and police services needed to make insurance premiums affordable, Vigna said.

Vernon businesses, which include food processors, apparel makers and other manufacturers, don't have a lot of faith in Perez's still-unrevealed proposals, said Rob Moeck, vice president of Douglas Steel Supply. The specialty steel company received a missive from Perry last week.

"Telling people to move I think is pretty smart," he said."If companies are manufacturers and don't have a regional customer base and can afford to move their equipment, they will move."

Getting companies to move to Texas long has been a cornerstone of Republican Gov. Perry's economic development platform, his spokesman Mark Miner said. "The state policy is to make Texas an attractive location" by keeping taxes low and government red tape to a minimum, Miner said.

Perry is emphasizing that message by pointing to a report by Chief Executive magazine that surveyed 500 chief executives around the country. Texas ranked first in business friendliness; California came in last place.

Pinning down Perry's claims of success in getting California companies to relocate is difficult. Last year, the governor boasted that he'd attracted 153 California firms to his state, but a study by the Austin American-Statesman concluded that the claims were overblown. Many of the companies that reportedly moved had actually remained in California but opened branch offices in Texas, the newspaper reported.

"Gov. Perry claims to be the great hunter of California jobs. His claims have been proven bogus," said Tom Dresslar, a spokesman for California Treasurer Bill Lockyer. "Texas has had about as much success capturing California jobs as Elmer Fudd did when he hunted Bugs Bunny. And the governor won't have any better luck preying on Vernon."

marc.lifsher@latimes.com

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