Managers at those companies - and others that have relocated northward - give different reasons for leaving Florida, but they have a few things in common: They're part of a steady trickle of companies, many of them manufacturers, that are forsaking Florida for Georgia; and most say that Georgia beckoned them enthusiastically with attractive incentives and a more amenable environmental regulatory climate.
Officials at Enterprise Florida, the state's public-private partnership that's in charge of economic development, dismiss the notion that any big trend is in the making. But a Dun & Bradstreet study of interstate migration by firms from 1991 to 1995 found that between Georgia and Florida, the Peach State had a net gain over its southern neighbor of 84 companies and almost 3,000 jobs; Florida lost more jobs to Georgia than to any other state; and companies moving to Georgia had on average seven more employees than firms that came to Florida.
That's no wholesale exodus, but evidence suggests that Florida is losing some companies of the kind that it can least afford to lose: healthy, expanding manufacturers with good-paying jobs. For instance, the Motorola energy products division, which produces rechargeable battery packs and chargers for portable electronics, transferred 100 staffers from Florida and then added more than 900 at its new facility in Georgia, 1/4 of whom are in professional-level positions.
When Georgia's Department of Industry, Trade and Tourism produced a list of companies it had a hand in luring from Florida to Georgia since 1991, all 15 were manufacturing or distribution operations: some high-paying, some paying low wages. "It disheartens me that Georgia has been so successful," laments Jim Garver, president and CEO of the Broward Economic Development Council.
Cherry picking?
Hanging over the discussion of Florida companies jumping the border are accusations that Georgia economic development officials have been overaggressive in luring firms. "Every time we make a presentation to a company, somehow they already have been contacted by a Georgia community or the state of Georgia," Garver says.
But Georgia officials say no such attempts at cherry picking are taking place. "We have not done anything specific in Florida for years," says Randy Cardoza, commissioner of the Georgia Department of Industry, Trade and Tourism.
Cardoza concedes that in the past, communities along Georgia's southern border made strong pitches to large companies in north Florida, but he says his agency relies solely on advertisements in national business publications and general direct mail solicitations. Jeffrey Cox, head of industrial development for Cairo, Ga., which is a hop across the border from Tallahassee, says his group doesn't recruit actively in Florida. "If someone shows an interest, we get in the game."
Even Enterprise Florida officials downplay recruiting by Georgia. "I know that there's been some efforts by regions in south Georgia and Alabama to attract Florida companies, but I don't think it's highly active," says Steve Mayberry, Enterprise Florida vice president of business expansion and retention. Mayberry says recruiters often follow an informal rule of avoiding cold calls to companies that haven't first expressed a desire to move, but concedes, "There really are no rules."
Regardless of strategies to lure them, firms are jumping state. They give a number of reasons for making the move, including a better pool of workers, proximity to Atlanta's consumer market, better air transportation routes and a less difficult regulatory climate.
After Seminole Marine moved its saltwater fishing boat manufacturing operation to Cairo less than two years ago, it doubled its output to 750 boats this past year. Chief Executive Officer Paul Hoppes credits Cairo's large pool of dependable workers. "In Florida, we had the same chronically unemployed people apply over and over," Hoppes says. "Here, for every job opening, we get to choose from dozens of good people."
Indeed, Mike Dooley, Motorola's energy projects division director of strategy and business development, says the decision to move to Georgia was based in part on a struggle to find high-quality people to keep pace with expansion. "We got to the point we were competing with ourselves for talent," Dooley says. He adds that another compelling factor was that Atlanta's airport offered more direct service to international sites where Motorola's people needed to go.
Manufacturers grumble about the higher cost of producing goods in Florida, listing a string of complaints that includes the sales tax on utilities, intangibles taxes on receivables, and taxes on replacement parts and pollution control equipment.
This spring, the Legislature appeased manufacturers on some issues but failed to act on others. Lawmakers broadened the reduction in sales tax on utilities. Now, if manufacturers can show that 75% of their electrical consumption is used for production, they can exempt 100% of their energy costs. Lawmakers also granted a one-year moratorium on unemployment tax for companies paying the minimum and reduced it by 35% for others. However, lawmakers left intact the sales tax on new equipment, replacement parts and pollution control devices. "It's going to take several years for us to build a base for those changes," says Lad Daniels, president of the First Coast Manufacturers Association.
In addition, manufacturers still complain that Florida's environmental and permitting rules are more onerous than Georgia's. For instance, Millenium Specialty Chemicals, formerly Glidco Inc., produces chemicals for fragrances and solvents at plants in both Jacksonville, Fla., and Brunswick, Ga., but is focusing most of its expansion in Georgia, says Chairman and CEO George Robbins. He says his company only has to deal with one environmental agency in Georgia, but must go through a series of agencies in Florida. "Georgia is a little more business-friendly than Florida."
Environmental concerns
In part, Georgia manufacturers enjoy enhanced clout because of their role in the state's economy. In 1995, manufacturing accounted for 18.7% of the jobs in Georgia, but only 8.5% in Florida, according to the U.S. Bureau of Labor Statistics. Yet Florida environmental advocates don't want the state to go any further in appeasing manufacturers with reforms such as streamlined and one-stop permitting. "The opinion in the environmental community is that Florida has given away the store," says Charles Lee, senior VP of the Florida Audubon Society. "Florida is teetering on becoming a dirty state."
Despite the migrations, Enterprise Florida's Mayberry insists there's no cause for alarm about firms leaving the state. "I don't see any significant trend that concerns us. We want to grow our manufacturing base in Florida," he says.
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Georgia Edges Florida In Population Growth
Georgia has recently outpaced Florida in attracting new residents. A U.S. Census Bureau estimate of population changes from July 1, 1995, to July 1, 1996, showed that Georgia's population grew by about 2%, the fourth highest growth rate in the country, while Florida was ranked 11th, with a 1.5% rate.
Florida's 14.4 million residents still nearly doubles Georgia's 7.35 million. But Georgia, especially Atlanta, is drawing plenty of new citizens from Florida cities. In the trade off of migrants between Atlanta and Florida's larger cities, Georgia is the winner. For instance, Internal Revenue Service figures for 1994 show that 993 people moved from Atlanta to Fort Lauderdale, while 2,066 people moved from Fort Lauderdale to Atlanta.
Atlanta sent 1,663 people to Tampa, but 2,612 Tampa residents moved in the other direction. Fewer than 500 people moved from Atlanta to Miami, while Atlanta gained 1,646 people from Miami.
Carol Taylor West, an economist with University of Florida's Bureau of Economic and Business Research, says it's more comfortable and common for people to move short distances to neighboring states. "It's less threatening to move up one state," she says. "People have more knowledge of that market ... that goes for people and companies."