Another High-Tech Co. to Ease Out of San Francisco Bay Area?

Word has it that another California high-tech company is looking for an out-of-state location to house a growing part of its business. Depending upon how much more cost-effective the locality proves out to be, it’s possible that later on more jobs will be relocated to the new community.

One specification is that the state and locality must be “friendly” to business – which brings me to some unfriendly targeting of a well-regarded company, Google.

Last week, headlines reflected mean-spiritedness hitting the streets of San Francisco. That’s when protesters blocked a Google bus from taking employees to their jobs at the company’s headquarters in Mountain View. How radical were those who impeded the lawful operation of a shuttle bus? Well, consider the extremists’ demand as illustrated by this headline: “Protesters Block Google Bus, Demand $1 Billion.”

Anti-Business California

The action reinforced my belief that California’s hostility to successful businesses will spill over to hostility to successful employees, who are guilty of, well, doing absolutely nothing wrong.

To Google officials I say – I hope you continue to meet with officials from economic development agencies representing places that show understanding toward job-creating companies. Places where being gracious remains part of the social fabric.

Google already knows plenty about friendly areas. Consider stories that have run this year alone about Google expanding in Pennsylvania (“Google to add hundreds of new employees to Pittsburgh office”), North Carolina (“Google announces $600M Lenoir data center expansion”) and South Carolina (“Google to invest $600 million, add 3rd data center in Berkeley County”).

I for one applaud Google for their elsewhere-in-the-nation expansions. So much of California’s electorate is anti-business, anti-corporate, anti-profit, anti-“rich people,” anti-urbanite, anti-suburbanite, and anti-just about anything that doesn’t fit their peculiar worldview. These less-than-stellar people elect radicalized politicians to public offices, and one result is a harsh business environment.

The protester’s justification for targeting Google? The San Francisco Chronicle says the private buses “have, for some, become a symbol of tech-fueled gentrification, economic inequality and soaring housing prices in the city.”

Fake Google Employee Outed

During the bus incident, someone who was being obnoxious claimed he worked for Google.

The Wall Street Journal reported that a “Google employee” who “jumped off the blocked bus, yelled and cursed at demonstrators, and pretended to blame them for their concerns about housing costs and gentrification” was really a union organizer – and he doesn’t even live in San Francisco. The Daily Mail posted a video of the incident.

KGO-TV in reporting on the protest said, “this may not be the end.” Really? If so, I suggest those who provide private shuttle bus services to their employees – Google, Facebook, Apple, Yahoo and Genentech – to more aggressively examine out-of-state options. Many states are more than suitable for your next facility.

In particular, businesses in San Francisco ought to re-think their location. There are about 3,000 non-California counties in the United States that are welcoming to commercial enterprises – places where protesters won’t insult your employees on public streets. Places where you won’t be “blamed” for bringing more wealth into a community.

Contempt for Bus Owner

One “demand” is that private bus operators be fined $1 billion. And the “crime” that warrants such action? Apparently, the tech industry’s private shuttles use more than 200 MUNI  (San Francisco Municipal Transportation Agency) bus stops, allegedly without contributing funds to support the “public infrastructure” at bus stops.

But private bus companies and their customers do financially support public infrastructure. For example, the owner of that bus pays 76.2 cents per gallon of diesel fuel – 51.8 cents of which goes to California (pdf) — the highest in the entire United States (pdf), a good portion of which is diverted from roads to subsidize transit operations like MUNI, BART, Caltrain’s peninsula commuter service and even bicycle trails.

Private bus operators pay hefty taxes when buying those expensive double-decker vehicles; pay sales taxes on every part down to the smallest bolt required for maintenance; and write checks for annual taxes and fees on business property and business licenses. Oh, and let’s not forget real estate taxes on offices and garages and vehicle registration fees – two taxes that Sacramento would like to increase next year.

Meanwhile, a MUNI, BART or Caltrain vehicle produces no sales or property taxes for the localities or the state. In fact, their purchase and operation requires continual taxpayer subsidies – paid for in part by the owner of the private bus that protesters blocked and the Google employees who were on the bus.

San Francisco’s radicals denounce self-supporting transit operations while advocating tax-absorbing operations. The city’s extremists obstructed a private bus driver who is unlikely to participate in a work stoppage while supporting BART where unions have gone on strike multiple times since 1976. Just how much more irresponsible can the city’s activists become?

High-Tech Companies Due Praise

The companies providing convenient shuttle services for employees generate enormous wealth for California and its counties and municipalities

For example, fat income tax revenue flow to the state as a result of job creation. With the state’s difficult business environment, and with alarming job losses in far northern California and the San Joaquin Valley, thank goodness the tech companies are creating lots of jobs.

Those jobs attract well-educated, highly motivated employees. These are well-compensated workers who pay huge amounts into the state’s “personal income tax” category that amounts to 61 percent of California’s revenues. Such ample funds allow irresponsible politicians in Sacramento – like Senate president pro tem Darrell Steinberg and Assembly Speaker John Perez – to indulge in their endless spending sprees.

Income taxes from well-compensated high-tech employees also underwrite recent pay raises for California legislators – already the most highly paid in the nation.

I won’t get into the real estate taxes, sales taxes and special fees generated by California’s high-tech firms. To mimic MasterCard’s commercial, for the state treasury they are “priceless.”

Protesters who blocked the Google bus either don’t know such facts or don’t care.

Tech Expansions Go Inland

A more reasonable civic environment is what Google found when it expanded in Oklahoma and Pennsylvania. Ditto for Adobe and eBay in Utah, Apple in North Carolina, PayPal and Intel in Arizona, McAfee in Texas, LinkedIn in Nebraska, Hewlett-Packard in Arkansas, Intuit in Nevada, SumTotal Systems in Florida – well, you get the idea.

Finally, the San Francisco area’s traffic congestion is just about the worst in the nation. Virtually everywhere else, an employer doesn’t even need to operate private shuttle buses for its staff. But where they do, the evidence is that the community appreciates it.

One focus of this blog has been to address California’s perennially difficult business environment. Joseph Vranich is known as The Business Relocation Coach while the formal name of his business is Spectrum Location Solutions. Joe helps companies find great locations in which to grow.