In small towns, even 20 jobs can mean a whole lot

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Over the past three months, a California toy business has transferred its packaging center here with plans for about 10 workers. In the eastern part of the state, a New Jersey pasta company has moved its plant to the town of Hope, bringing about 20 jobs.

In larger cities around the country, millions of jobs have vanished. In rural North Dakota, a few have arrived.

Behind the moves are North Dakota natives. And they say small businesses like theirs will help anchor the state's economy.

"Twenty jobs in rural North Dakota is like a thousand jobs in a bigger city," said Claude Smith, president of La Rinascente Pasta.

The 50-year-old New Jersey pasta company has moved its plant to Hope, a town of about 300 people in Steele County. The company makes thin pasta known as fideo that is aimed at Hispanic markets.

La Rinascente Pasta began shipping pasta in February. It expects to ship some 5 million pounds of the product annually. The plant employs about 20 people.

Luring large businesses with hundreds of workers is a long shot for the state, said Smith, a Hope native who helped ink the deal to move the pasta plant to town.

"Bill Gates is not dying to build a big chip plant in North Dakota," Smith said.

"We're a long way from anywhere, and frankly, our winter weather stinks," he said.

Officials from three other companies who have moved all or part of their operations to North Dakota say the state's overall affordability and hardworking workers are attractive to small businesses looking to uproot from higher cost urban areas.

A group of 32 North Dakota investors formed a company to buy La Rinascente last year.

Mayor Gary Ihry said he put some money in the pasta company as an investment in the community.

"Anytime you create jobs - that's what gives families the opportunity to keep a community going," Ihry said.

Randy Richards, president of the investors' group, said the pasta company also got a grant of about $50,000 from the state Agricultural Products Utilization Commission, which funds developers of North Dakota farm products.

Rock Clapper hasn't lived in North Dakota for 23 years, but that hasn't stopped him from promoting the state as an economic hot spot to his colleagues in California's Silicon Valley.

"I've been an ambassador for the state," said Clapper, who originally is from Carrington.

He moved part of his Palo Alto, Calif-based software company to Langdon in March. Datatic Technologies plans to hire up to a dozen people to work over the next several months, for computer networking, programming and sales.

"I don't think a company has to be huge for it to be a benefit for the state," said Jonathan Bry, the Bismarck general manager of Fantasy Toys Inc.

The company makes flexible building blocks called Flexitoys, which are marketed to day care centers and schools.

The Bismarck City Commission approved an incentive package for the Santa Rosa, Calif., toy company. But owner Reid Bennett said the frustration he went through to get a five-year tax exemption and a $25,000 grant from the city to relocate his company's packaging and distribution center from Arkansas City, Kan. was hardly worth it.

"It was a very arduous process, that in the end, I'm not really getting that much," Bennett said.

Company officials have said up to 10 workers could be employed over time.

"The feeling I got was that they're really not interested in smaller businesses," Bennett said. "They looked at us with great suspicion. I couldn't imagine that they could have done anything more to drive me away."

Bennett wanted city officials to authorized a $45,000 loan buydown for a $315,000 building he purchased in south Bismarck. The building sat vacant for two years, he said, but the cost of accounting mandated by the city would have been more than what he would have gained with the loan buydown.

"I'm disappointed he's not happy with what he got," said Marv Heinert, the chairman of the committee that oversees Bismarck's city sales tax-supported Vision Fund.

Heinert, who owns an accounting firm in Bismarck, said his committee is cautious.

"When you talk about spending this money, you're talking about spending tax money. That's my money and your money," Heinert said."

Bennett said the only reason he went ahead with the deal is because Bry, who had worked for the company for years, had to move back to Bismarck for family reasons.

"I've had hundreds and hundreds of employees over the years and Jon is the best employee I've every had," Bennett said.

Bry said he was a little embarrassed because he had touted Bismarck as business-friendly town to his boss.

"I'm all for corporate accountability, but I think they overcompensated on us," Bry said.

Heinert acknowledged that his committee would rather deal with larger companies.

"If we have to work 10 deals to get a hundred jobs or one deal to get 100 jobs, we want the one deal," Heinert said.

Tracy Burkhart, a Minot native and former South Dakota State trooper, said his love of motorcycles and North Dakota helped bring a new business in Devils Lake.

GP Star, which specializes in exotic motorcycles and parts, relocated its remanufacturing, sales, shipping and administration offices from Los Angeles to Devils Lake late last year.

Elias McGeeney, the company's president, said California has become too expensive to do business.

The company worked with state and city officials, and landed an incentive package worth about $475,000.

The company expects to have some 20 people on the payroll, with salaries up to $60,000.

North Dakota generally has not shared the huge job losses felt in larger more industrial states. But the state's economy is still a political issue.

Republican Gov. John Hoeven says North Dakota has one of the nation's lowest unemployment rates, and its economy is growing. Democratic governor candidate Joe Satrom says it could be better, with higher-paying jobs, and he would make greater use of the state-owned Bank of North Dakota to help.

Brian Walters, president of Fargo-Cass County Economic Development Corp., said more than 15,000 communities around the country have some sort of economic incentive package to help snag a business shopping for a new home.

Fargo has landed one of the larger ones, Alien Technology, which plans to make tiny radio-frequency transmitters there. Alien, based in Morgan Hill, Calif., has been planning to build a chip factory in North Dakota State University's technology park.

"We are competing against every other community that wants to make their community a better place to live," Walters said.

"It's a paradox for the state," Burkhart said. "Large companies have to see that small companies can be successful before they will do it."

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