In March 2010, Nor-Cal Produce, a family-owned produce business in West Sacramento, was fined $32,500 by the California Air Resources Board (ARB, or CARB). The company was not charged with, or even accused of, illegal emissions; like many other businesses, it had merely failed to notice a new regulation posted by CARB requiring all semi-trailers, shipping containers, vans, and rail cars with diesel-powered refrigerators to file a report with the agency. “We had no knowledge of the law,” Nor-Cal’s Chief Financial Officer Todd Achando told CalWatchDog, a news blog that monitors California government. “My operations manager happened to see it mentioned in a trade magazine about a year and a half after the deadline passed.” Because Nor-Cal reported itself to CARB and “cooperated,” the agency reduced the $200/day fine from $86,600 to $32,500.
Kit Enger and his fellow dune buggy manufacturers also cooperated with CARB, but found it was like dealing with a mob “protection racket.” Enger, president of the Compliant Car Builders Association in Oceanside, California, said association members attended the agency’s “implementation outreach workshop” for OHRV (off-highway recreational vehicles) and worked “diligently with CARB certification staff to devise a program whereby all industry members could efficiently and effectively certify their vehicles and engines.” Despite the increased costs and inconvenience of complying with CARB’s new regulations, association members thought things were going pretty well — until January 2008 when CARB hit them with $3.6 million in penalties for alleged violations. The association’s lawyers worked the fine down to $600,000, but Enger says even that penalty was unconstitutional, amounting to an ex post facto prosecution for engines modified and sold before the new CARB regulations went into effect.
“My lawyers said it would cost more than $600,000 to fight it, so we might as well pay it. It’s like a protection racket — government out of control,” said Enger. When he testified before CARB in November 2009, Enger told the board that one of their CARB enforcement officers had told him on two occasions, “If you guys don’t get on with this settlement, it doesn’t matter to us if you go out of business, change your name, move to another state, or die, we will find you and attach your assets.”
Thousands of businesses have already fled the “protection racket” of government in what was once known as the Golden State; thousands more are following, taking with them hundreds of thousands of jobs. The state’s tax and regulatory policies have driven the cost of energy, as well as every other business expense, sky high. Yet, despite facing $25 billion in debt, a huge current budget deficit, and default on its bonds (not to mention sky-high unemployment, over 12 percent), the state’s politicians and bureaucrats continue to chase the productive tax base — and jobs — out of California. Joseph Vranich of Irvine, California, known as “The Business Relocation Coach (CLICK HERE),” keeps a running tab on companies leaving the state. His December 6, 2010 blog carries this headline: “New Record for Calif. Companies Departing or Shifting Work Out: 193 — Nearly Four Times Last Year’s Level.”
The jobs that are leaving or shutting down are not only the manufacturing and resource jobs in companies that greenies love to denigrate as “old, has-been” industries; they include many of the highly touted “green” companies that are now seeking greener pastures elsewhere. One of them is Solyndra, the solar panel maker from Fremont, which announced layoffs of 170 workers in December. Only a few months earlier Solyndra had hosted a much publicized press conference with President Barack Obama and Governor Arnold Schwarzenegger, both of whom lauded the company as an exemplar of the “green economy” that would provide many thousands of new “green jobs.” Solyndra received a $535 million loan from the Department of Energy to build a new state-of-the-art, robotics-run factory, which it calls Fab 2. In November 2010, Solyndra announced it was mothballing Fab 1 and postponing earlier plans to expand Fab 2, citing weak sales and the weak economy.
Other California “green-tech” firms have closed or are shifting much of their operations out of the state. For example:
• Barefoot Motors, maker of electric ATVs, moved to Oregon.
• Mariah Power, a manufacturer of small wind turbines, moved to Nevada and Michigan.
• Sonatype, Inc., which services many high-tech companies, moved to Maryland.
• Adobe Systems, Inc., the software giant, is building its huge new campus in Utah.
Other companies that have jumped ship from California include Fidelity National Financial (moved operations to Florida); CalPortland Cement (closed its Riverside County plant); Buck Knives (moved to Idaho); Multi-Fineline Electronix, Inc. (moved to China); and Thomas Brothers Maps (moved to Illinois and India).
These are only a fraction of the “primary companies” that have made the news; thousands of secondary companies — restaurants, service outlets, retail stores, construction companies, trucking companies, farms, ranches, mom-and-pop businesses — have vanished with no media notice.