How often does a major household-name U.S. corporation — No. 8 on the latest Fortune 500 ranking with a market value topping $273 billion — complain publicly about heavy taxes and suggest relocating its headquarters?
General Electric shocked the nation's economic development world this month when CEO Jeff Immelt announced GE needs to figure out if it's time to move its headquarters out of Fairfield, Conn., to a more tax-friendly state. The giant maker of everything from household appliances and lighting to aviation, transportation products and energy management employs 5,700 at its headquarters and more than 300,000 worldwide.
Immelt called Connecticut's tax scene "truly discouraging."
The response to GE has been rapid if not rabid. Some states seem to recognize a potential headquarters relocation of a company the size and stature of GE is a once-in-a-generation opportunity.
Is Florida arriving late to the GE conga line? Is Jeff Vinik — granted, he is distracted by something called the Stanley Cup — slow to pick up the hotline to CEO Immelt?
"I'm sure governors from across America are knocking down your door since you openly declared your displeasure with Connecticut's proposed $700 million increase in taxes on businesses over the next two years," Texas Gov. Greg Abbott recently wrote Immelt. "But how many of my colleagues just passed a total relief tax package of $3.8 billion like we did last week in Texas?" Texas is home to 54 Fortune 500 headquarters.
In Georgia, where 20 Fortune 500 companies are based, Gov. Nathan Deal thinks a company as large as GE is serious "when they start publicly talking about these things." As he told the Atlanta newspaper: "They can do all of the pressure they need behind the scenes. They don't have to go public in order to put pressure. … We want to make sure we make the good pitch for Georgia."
Other states pitching GE include Ohio and New York.
At the state level — and an effort to recruit a company the size of GE would require major state involvement — there's little word that Florida is beyond a tepid Defcon 5, much less 1. In Tampa, Vinik's staff on Monday indicated they do not believe their boss has been in touch with GE.
Tampa Hillsborough Economic Development Corp. chief Rick Homans hints GE is on his radar. "I can guarantee you that if a company comes right out and says it wants to move its headquarters, we're in touch with them," he stated in an email.
GE has recently nibbled some of Florida's recruitment crumbs. Last year, GE's Energy Management business left New York to create a new manufacturing Center of Excellence in Clearwater.
A GE corporate team is now analyzing states with a "more probusiness environment."
Is this relocation talk real or corporate posturing to squeeze more concessions out of Connecticut? The early betting is Immelt is serious. Can Florida or even Vinik afford to underestimate the possibilities?
Contact Robert Trigaux at [email protected]