Calif. company moving plant to NLV site

Kevin Rademacher

Tuesday, March 25, 2003 | 10:56 a.m.

Looking to escape rising costs in California, Coast Converters Inc. is moving its manufacturing business to North Las Vegas.

The Los Angeles-based plastics company has leased 100,000 square feet at 4980 Statz St., near Craig Road and Interstate 15, and expects to have 130 employees at work there in the next two months, said Mitchell Greif, company chairman.

Coast Converters manufactures plastic bags for everything from frozen foods to casino vaults, Greif said. Employees began testing newly acquired equipment two weeks ago at the Statz Street location. The rest of the equipment will be shipped to Nevada in phases.

Greif said he had been exploring a move to Las Vegas for several years, but the process accelerated after California workers' compensation costs increased 65 percent.

"The cost of doing business in California is just prohibitive," he said.

Coupled with higher electricity prices in Southern California, Greif said there was "sufficient reason for the move after conducting a payback analysis."

Somer Hollingsworth, president and CEO of the Nevada Development Authority, an economic development agency, said rising costs in California have kept his agency busy.

"Coast is a good poster child for what is going on in California," he said. "We've seen more action in the manufacturing sector than I've ever seen, and I came to the NDA in 1995."

He emphasized that these are not companies the need to save money to survive.

"These are not companies that are broken," he said. "They are making money. It's just great for us."

Companies have not been deterred by looming tax increases in Nevada.

"Everybody is aware about what's going on," Hollingsworth said. "They know we're talking about broadening the tax base. These are very astute people. They are still better off making the move."

Many of Coast Container's Los Angeles-based employees have visited the valley in search of homes, said Las Vegas real estate agents Chris and Anne Johnson of Century 21 Aadvantage Gold, who are working with the employees.

"People from L.A. can buy homes (in Las Vegas) they never would have dreamed of before," Greif said, adding that many of his current employees are expected to make the move.

Greif said the company will move all of the California operations, except sales, to the North Las Vegas site. Hollingsworth said such an arrangement is becoming typical.

"A lot of companies, their market is still California," he said. "But they will serve that market from Nevada. This is probably one of the biggest windfalls we have ever seen."

The company has leased the former Mexico Plastics Co. location in North Las Vegas and purchased some of that company's equipment. Some of Mexico Plastics former employees could be interviewed for positions, Greif said.