Selling Nevada next door

When Aki Korhonen decided to move his software company to Reno from the San Francisco Bay area, he wasn't driven to action by any single event.

Instead, Korhonen said he felt compelled to move by a steady drip, drip, drip of little things that finally became an accumulation his company, PCDoctor, no longer could bear.

Economic development officials in northern Nevada are working double time this autumn to keep businesses in California aware of the cost advantages available to them if they'll move across the state line.

An aggressive advertising program tells California businesspeople that workers compensation and utility costs both are dramatically lower in Nevada.

It reminds them, too, that California's version of the Family Medical Leave Act is much richer than the federal version of the law in force in Nevada.

(To take a look at the campaign, go to EDAWN.org and follow the California Comparative Cost Assessment on top of the home page.) It's too early to tell if the campaign will be successful.

Even the quickest corporate move takes at least 90 days, and it's not

unusual for corporate decision to take five years, said Lisa Plummer, director of new business development for the Reno-based Economic Development Authority of Northern Nevada.

Even so, Plummer said Nevada economic officials see evidence their mes- sage is sinking in.

"We've definitely had a spike of interest," Plummer said.

The home page of EDAWN's Web site encourages visitors to compare costs between the two states, and Plummer said workers compensation often is the figure that gets the attention of business people deciding where to locate a business.

One small California company that was in contact with EDAWN recently, for instance, saw its workers compensation rates climb to $800,000 from $300,000 a year earlier.

"It's a big, big issue, particularly for manufacturers," Plummer said.

But the experience of PC-Doctor shows that moving a company may involve more sophisticated analysis than merely totaling up workers compensation rates.

Korhonen said the company, which makes diagnostic software used by computer hardware manufacturers, timed the move of its headquarter to Reno to stay ahead of what it expects to be a big growth period.

"It's easier to move before growth, rather than after growth," he said.

Then, too, PC-Doctor timed its move to take advantage of a soft labor market in high technology.

Although company officials were in Reno to interview job candidates last week, Korhonen expects that most of the 40 to 50 people employed at its Reno operation will come with the company when it moves from Emeryville, Calif.

But underlying all the tactical considerations is the belief of PC-Doctor executives that the company simply can do better in Nevada.

"The business climate in California has continuously eroded," Korhonen said.

"It's no longer as competitive as it was to run a business here."

An emigre to the United States from Europe 13 years ago, Korhonen said he watched as European economies stagnated under the weight of taxes and social programs.

"We've seen California slide down that same slope," he said.