Las Vegas Sun

March 18, 2024

Q&A: Somer Hollingsworth

President and CEO, Nevada Development Authority

hollingsworth

Steve Marcus

Aggressive recruiter: Somer Hollingsworth, president and CEO of the Nevada Development Authority, is shown in his office Sept. 17.

Longtime Las Vegas resident Somer Hollingsworth is president and CEO of the Nevada Development Authority, but it seems his favorite pastime is getting under the skin of California leaders trying to prevent businesses from leaving that state.

Hollingsworth, who grew up in Texas and went to school in New Mexico and Washington, had a career in banking before opening a consulting company, which led to his involvement with and leadership of the Nevada Development Authority.

One of the authority’s big initiatives is to recruit business and industry from California with a promise of lower taxes and a friendlier business climate. One year the authority’s tactics drew Gov. Arnold Schwarzenegger’s attention and the former actor piloted a moving van on the Strip, returning a business that left the state to California.

The authority hasn’t let up, and Hollingsworth talked to In Business Las Vegas about the success of the newest campaign and the challenges of diversifying Southern Nevada’s economy.

IBLV: You and the Nevada Development Authority are getting quite a reputation for being troublemakers in California. Tell us about the recent campaign to persuade California companies to move to Nevada.

Hollingsworth: We have been in California hot and heavy since (former Gov.) Gray Davis. We saw the state starting to slip then, so we built some, at that time, pretty edgy campaigns. And we made some smart remarks about Gray Davis being the best recruiter we’ve ever had and that we would love to see him reelected and we should be contributing to his reelection campaign. We got quoted in the Orange County Register, which didn’t make him happy. (California Gov.) Arnold (Schwarzenegger) comes along and tries to do the right thing and cannot get a referendum through to redo CalPERS (California Public Employees’ Retirement System), which was a fiasco. In fact, the unions spent $110 million marketing against that and convincing people that it wouldn’t be the right thing to do. All they wanted to do was change the insurance a little bit.

Just so you know, CalPERS, right now, the pension and insurance together, is about $200 billion unfunded. It’s a gigantic number. I don’t know how you ever get away from that. Every campaign that we ran down there — whether it was “Will your business be Terminated?” or “The Giant California Tax Nut,” all those things were well received. We got a lot of publicity, and they were pretty edgy campaigns. “The Great California Tax Nut,” KABC Television refused to run them and KABC refused to run these (the current ads). It was pretty much that “We don’t think that this is in the best interest of California.” We don’t argue about it because we get great press off it. So they don’t run it, we tell everybody we know and everybody goes, “They’re so insane that nobody will run the commercials.” Well it was only that one station.

We have always had about 25 percent of our business from California, and we saw it starting to jump and we saw the inquiries starting to jump. This started to happen right after we finished up the political cartoon ad with the California Tax Bear and that worked out really well. That was a print campaign. And we started getting calls from people saying, “Hey, I just saw your ad.” Well, we hadn’t run it in eight months, so we figured something was going on because they remembered it. In 2008 we began to get more inquiries. In January when they started talking about their deficit — California said its deficit was about $9 billion — my guesstimate at that point was $24 billion and I was right on the money. I know more about the numbers than they do because we live and breathe on what they’re doing because it’s a great source of business. The inquiries started to jump through the roof. And we said, “OK, what has happened in the past?” California businesses have this incredible ability to raise their pain threshold. They went through the power shortage, they went through the energy crisis. They went through the workman’s comp chaos. They went through it all. We’d get a spurt of business and then the pain threshold would go up and they would level out.

Well, what we saw this time was the tipping point. The recession was there, and most people had hunkered down. We had a tough time bringing business in because nobody wanted to move, they didn’t know what the country was going to do. Once they saw the state start to wobble and come undone, they began to panic because they know that whatever happens on that shortfall will come down to businesses. It’s going to come down in fees, it’s going to come in taxes, it’s going to come down in government regulations.

How is this campaign different from past recruitment efforts in California?

We started to build a campaign in March, and we wanted to go edgy. We’re going to get so far outside the box that everybody is going to see it because you have 48 other states that are looking for the same business. And we’re not going to be a cutesy ad and we’re not going to show streams and rivers and we’re not going to show things that give you warm and fuzzy. We are going to go after the companies that we’re after. We knew upfront that the Legislature wasn’t going to be happy and the governor was not going to be happy.

That’s not important to me. The only thing I’m focused on is to make sure that Nevada — Las Vegas especially — diversifies its economy. You know as Las Vegas, goes so goes the state. We’ve got to diversify this economy. I don’t care who I walk on over there. I really don’t and I don’t care what they say because the more publicity we get, the more companies we’re going to bring in. So we built the campaign and it was exactly what we wanted. First, we waited past June 1 because we wanted to make sure our Legislature was through. We didn’t want to go out and say something and then something happens in our Legislature and the L.A. Times write a huge story about “uh oh” and destroy the campaign. Then, we got notice from a source that we use on a continual basis that feeds us with all this information which, by the way, anybody can access, that they were going to have a 24.5 percent increase in workman’s comp July 1. So we waited until July 1 and they decided not to do it. There was a lot of hoopla about what we were doing over there and we really didn’t put it out to anybody. We waited and they said, “We’re going to postpone it.” So we said, “All right, let’s go ahead.”

We launched Aug. 7 down in California and it has never stopped. It has been absolutely the best campaign that we have ever done. The PR side of it is on fire. Obviously the legislators hate it. They tried to do an anti-Vegas campaign. It was kind of a question thing: “Would you leave California? Would you stay here?” “No” or “Yes, I’ll stay here.” And I said if they really want to get some hits on this, they need to put another check over there that says, “Hell no, I want to get out of California.” That would get 10 times the number of hits of “Yes, I want to stay in California.” (The woman taking the survey) thought that was very funny, and we do too. On the interview of that particular Web site that they had, the gal asked me, “What do you think of it?” And I told her that I thought it was great. I love good campaigns. I love someone that counters us. It makes us stronger. I like it when they challenge us because it makes us stronger because the backbone and the structure that makes it easier to do business here is part of us. It’s not something we just created. It’s not something we have to rebuild. When this recession is over, it’s here, it’s already here in place. They have to stop the train, turn it around and move backward, which they’re not going to do.

But the response from the businesses has been phenomenal and that’s who we’re after. We know how they feel. We know what they’re going through and we know exactly how to reach them now. So the more press we get, the better off we are.

How will you measure whether the campaign has been a success?

There’s going to be a lot of ways we’re going to measure it. Obviously, you can measure it on your ROI (return on investment). Just to give you an example, we’ve spent about $150,000 so far. We’re scheduled for about $250,000 for every 90 days. So far today the actual value of the campaign for us as far as the ads and as far as the leveraged media that we got is running about $4.5 million.

But the wonderful thing is the number of impressions is 55 million right now. So the ROI is already through the roof. We didn’t consider that Greta Van Susteren (of Fox News) decided she was going to do a story that we didn’t know about. And a Wall Street Journal guy was wonderful — he basically validated everything that we said. She’s run that show three or four times now. The impressions on that is nearly 8.5 million, which is wonderful.

The other side of that is how many inquiries are we getting? We’re getting, really, about an inquiry a day that’s coming in from all over the place. You’ll get days where you’ll get four or five a day and others when you don’t get any. It’s that kind of a deal. For 30 days, we’ve had about 36 inquiries, which is great. About 50 percent of those are out of California. The nice part is we don’t consider anybody a client until we physically get them here, we physically talk to them and we create the relationship. Otherwise, they’re just an inquiry. We’re not going to kid ourselves. The great part is that sense of urgency we saw in January, February and March has turned into almost panic. When we sit down with them, they say, “When can I come over?” We’ll go over there, but they want to come over here. “Can I look at buildings?” “What do you need?”

So by the time they come over, we take them on a tour and it’s all set up. That will ultimately tell what we’re going to do. The companies we’re seeing are not throwaway companies. They’re small companies. We don’t have delusions of grandeur. I don’t believe that I’m going to get a Microsoft headquarters here. But I’ll tell you what, I’ll diversify this economy with ones or twos with high-quality small companies. So 25-100 jobs and they’re excellent wages and excellent benefits for their employees. And the companies have legs, they’re not startups. Some of them have been there 30 years. When you’ve been there 30 years, it’s difficult to say, “I’ve got to get out of here,” because you’ve weathered everything.

What types of companies do you hope to move to Las Vegas?

All the way across the board. Manufacturing companies. And that runs all the way from fabrication to plastics, from one end of the spectrum to the other. We’re looking at some pharmaceutical companies. We’re looking at some tech companies. We’ve got one company that’s a conglomerate that owns three tech companies under the holding company. And they’re absolutely spectacular. We don’t have them yet, but they’re talking to us and they’re very sincere in what they’re doing. It’s not one of those things where they’re saying, “Finish the information and we’ll call you.” It’s on the phone, on the phone, on the phone kind of a deal so my guys are working really hard on that. We’re really pleased right now.

And the campaign is just barely off the ground. As you well know, it’s that time frame. You don’t really start seeing a lot of stuff until you’ve got a campaign running for about six months. If this campaign loses its legs within 90 days, we’ll build a brand new one. We’ll do a whole different deal because, trust me, the stuff that’s going on over there is so deep we could do campaigns for the next five years and not run out programs with really edgy campaigns.

Does the Nevada Development Authority or the government offer any incentives for companies to move?

Oh yeah, the state does. Beautiful incentives. There are no giveaways in the incentive programs in Nevada, which is wonderful. There are no free buildings. There is no free cash. There is no free land. But we will give them, for example, sales and use tax abatements. So we can make 6.1 percent of the sales tax on their capital equipment purchases go away. They don’t ever have to pay it on an initial buy, not forever. You have real property tax. You have property tax abatements. You have training dollars. You have just all kinds that are here. We have to understand and we have to explain this to the client: If you go to a state with taxes and they’re abating taxes, we have none. So that’s already built in. If they’re abating your corporate taxes and their personal taxes, we have no personal taxes, so corporate and personal don’t exist ... About 85 percent of everything in what workers’ comp covers is considerably less than in California. What we’re hearing is that they have pushed that 24.5 percent workman’s comp increase to January to about 22 percent. They’re one of the highest workman’s comp states in the United States today. Hopefully that will go through. So to answer your question, yes.

How has the weak economy changed the recruitment strategy? Is it harder or easier to persuade companies to move considering the cost of making such a dramatic change?

Well, it’s not the cost of making the change, it’s the competition. The competition from other states is free buildings and free land. It’s just the point where it’s almost overwhelming. We’ve heard Arizona may lower its corporate income tax rate. They realize it’s not working for them. They have that income tax rate and they’ve found they can recruit more companies with less. But again, it still runs in the area of 5 or 6 percent. You’ve got New Mexico, Texas, Arizona. They’re huge competitors of ours. Believe it or not, Oregon is a pretty good competitor, even though that state has got some fairly high tax bases, especially on property taxes. But there’s the ambience of living in Oregon, and there’s the ambience of living in Washington state that has a gross receipts tax. The point is that everybody is trying to create jobs and in a state that has a very high tax base, they really are simply giving back the tax dollars. So if you get a tax waiver for four years or three years, when that honeymoon’s over, that comes into play, that affects the bottom line of that company tremendously. It doesn’t make any difference. They’re still moving there. So it’s a very competitive nature right now.

How important is the state’s low-tax climate to your efforts to lure businesses to Nevada?

It’s extremely important. You’ll hear people say, “Well, it’s not that important.” Yes it is, and it’s becoming more important in this environment. For example, in California, the corporate tax is 8.4 percent. You move here and that goes right to the bottom line. Their personal income tax is as high as 9.3 (percent). Well imagine if you come over with your employees and your employees automatically get a raise as high as 9.3 percent. But let’s say that the low side in California is 5 or 6 (percent). You don’t have to pay for that raise. That doesn’t come out of your pocket, and the employees are happy. The opportunity for those employees to own a house in California still is not there. The number of companies that we talked to where the employees have been with them forever, and they still do not own a home because they have not been able to get in front of the power curve in California — what a better deal than they have over here. When you have a 3 percent unemployment rate, it’s difficult to find a lot of people. I mean, you can find them, but everybody’s working and you really have to negotiate. Right now, you have people with college degrees, masters, Ph.D.s who are either unemployed or underemployed, so what a great time to come over here and put together a program and be able to hire some of the best people out there. So it’s all working to our advantage right now and we’re taking advantage of every part of that and we tell that to the client when we talk to them.

Some critics have said the NDA’s efforts to emphasize the low-tax climate have actually worked against efforts to raise taxes when they are needed for broadening the tax base. Your response?

When are they needed to broaden the tax base is my question. Why are they needed? I don’t have any problem with taxes. The NDA’s statement at the Legislature, under testimony, was that we would support a broad-based business tax. Everybody forgets that. And I know exactly who you’re talking about because I watch you guys on TV. NDA is not an ultraconservative group of guys and gals. It is across the board. And we talk about everything being on the table, but also using common sense because the revenue side of the equation is always the revenue side of the equation.

California is 49th in the nation, the highest corporate tax. I believe they’re the 47th highest personal income tax and the 43rd highest sales tax. They’re upside down. They have a $24 billion deficit. So what do the taxes do? How much more can you tax? They lead the world in taxes, and it hasn’t worked.

That’s the whole point. You’ve got to look at the expense side too. We did a tax study. It was on the volatility of taxes. No tax study in the history of Nevada has ever covered anything except the state. We covered Clark County, municipalities, taxes, revenues, fees, everything. And we went into the volatility of taxes that there is no magic tax. You can’t pick one. And that’s the mistake we’ve always made. “Let’s raise gaming. Well wait a minute, let’s raise something that’s related to the tourism industry like the room tax.” Well how volatile is that? So every tax has a volatility, up and down, one side or the other, any part of the economy. What we said was look at the volatility of the taxes and use common sense if you decide you want to put a tax in place. We didn’t oppose the VAT (value-added tax). We didn’t oppose raising the VAT by any stretch of the imagination. There’s both sides of the fence. There’s the side of the fence that says, “Well, if we’re not going to raise taxes, we’re going to go down a suicide mission.”

And there’s the other side, like the Tax Foundation in Washington, D.C., that will tell you absolutely point blank that low corporate income taxes at the state or national level spurs growth, it brings companies to you. That’s why Arizona is looking at lowering it. You know, we’re sitting here yelling, “Raise it” — or somebody is. And Arizona is saying, “Well, we need to lower ours because it’s not working for us.” I think you need to look around you. Use California as an example. Do you want to end up like them? Once again, NDA has never opposed a corporate income tax. We’ve never said that. The broad-based business tax came from that gross-receipts deal and part of it was our testimony. We probably, as much as anybody that’s a nonprofit that is trying to diversify this economy, have taken the road of “Let’s talk about everything. Let’s put it on the table. But let’s use common sense.”

When you talk to executives from companies that are considering moving here, what are their biggest concerns about coming?

One of the toughest things we have is that nearly everybody we talk to has been to Las Vegas — but they’ve been to Las Vegas to have a great time, to entertain. They’ve been here for a convention, they’ve been here for a party. They’ve been here for a birthday or a wedding or whatever. They’ve only seen that side of Las Vegas. It’s kind of a yea-nay deal. The “nay” part is they have an idea of what’s here that isn’t what’s here. They have an idea that only takes in the resort industry. They have a great time and they love that part.

The good part for us is when we start to explain to them the infrastructure as far as telecommunications and tech, it blows them away. When we talk about the broadband we have here. When we talk about the university, they don’t even know the university exists. That university is a growing university and it’s a great university, and it’s going to get even better. With the new president out there, I think you’re going to see some wonderful things come out of that university. When we show them the planned communities we have here, when we show them corporate centers like the one we’re sitting in now, it absolutely fascinates them. They didn’t know all these things existed. They didn’t know that we had all of this industrial and all this commercial. They didn’t know we had this many churches or private schools. It’s difficult to show that to them. An ad campaign showing that to them probably isn’t going to bring them here, but let me tell you, when we get into the incentives and stuff, the thing that they really look at — when you look at the taxes and you look at the workman’s comp, you look at all those things, but if you put a great big bow around everything in California that they hate, it’s the fact that it’s anti-business.

Nevada and Las Vegas are pro-business. Our Legislature is pro-business. They’ve done an incredible job of promoting legislation that was business-positive. And that’s what they’re looking for right now. They can’t get beat up anymore. They want somebody to give a darn that they’re there and really put their arms around them and say, “We really want you here and we want you to be successful.” So that really encompasses everything, more than the taxes and more than the workman’s comp and all those kinds of things. You can have all that stuff, but if you’re still anti-business, what difference does it make?

What’s the biggest roadblock to companies considering making the decision to move? Our education system? The influence of the casino industry on our way of life? The hot summers?

I think it’s moving. It’s just the agony of packing up and moving and how many employees are going to come with you? You don’t just pack up after 30 years with 140 employees and say, “Well, guys, we’re going to go.” They’ve done their due diligence before they make that decision and the due diligence includes meeting with every staffing agency they can and looking at everything we can possibly put in front of them as far as the school system goes. Most of the school systems, K-12, around the country are broken. There’s no question about it.

California can say what they want to but their school system is not in great shape and now with the cuts, they may shorten their K-12 school year. They may lose as many as 50,000 students and 5,000 teachers at the California university system because of the cuts. So they’re not going to be in any great shape whatsoever.

But it’s that “Who’s going to come with us?” It’s a big move. You’re not moving mom and dad. You’re moving a whole family of maybe anywhere from 25 to 100-plus employees. That’s a difficult thing to do. The easy part is that it’s easier to move you only 300 miles or, from the San Francisco area, 700 miles, than it is to move 2,000 miles or 3,000 miles. Arizona is very competitive because of that, because they’re about the same distance away and they’re over there doing what they have to do. But that’s the most difficult decision. They have everything here to make the decision because if they’re not happy, we never get to that point. We never get to the move point.

If we give them all the facts and we footnote everything and say, “It’s important that you make the right decision. If you move or don’t move, we don’t want you coming over here and then realizing you made the wrong decision so these are all the facts. What do you want to do?”

What do you tell executives of companies that say they won’t come because Nevada’s education system is ranked so low among states?

Well, I hate to say this, but we’ve never been asked that.

Really?

Yes. Never, ever, ever has anybody asked that. If you have a homegrown company, they will say is, “We’ve checked out your private school system and could we meet some of those people?” We’ve never, ever had anybody say, “Well, we’ve checked you out and you’re pretty low.” I think if they have a problem with the school system when they check it out, they’re not going to talk to us. They’re pretty astute. They pretty much do a due diligence before they come over, so they’ve done a lot of stuff and a lot of inquiries. We just kind of take it to the next level, which is to bring people to sit across from them for third-party validation, whether it’s a staffing agency, whether it’s (NV Energy) or Southwest Gas, whether it’s a law firm, whether it’s a real estate agency or whatever. They really get the final what they need to know, but they pretty much know what the pros and cons are.

Have there been any concerns raised about how our state government operates and the lack of tax revenue to provide basic services?

No, because every state has got the same problem. Every state has a lack of revenue to provide basic services. And I think Nevada needs to understand that and quit wallowing around the mud thinking we’re the only one. It’s happening everyplace. We’re no different from anybody else, so it’s not an issue.

Here’s the issue that causes me more heartburn than anything else: When we looked at the gross receipts tax, we had literally five to 10 companies working with us that put us on hold. The deal is, if I’m moving, I’m moving there for certain things and I want to make sure those things are in place when I move there. I really need a feel for the legislation. The worst thing we ever had was the malpractice insurance debacle. When it went across the nation, it was basically that we didn’t have any doctors. I mean we had companies that just put us on ice. The newspapers blew it out of proportion so badly, it was like no doctors existed. It was mostly OB/GYNs and that was a problem. But the long and short of it was that when the story came out in the press and on television, it was basically, “You guys don’t have any docs here.” The last thing was the hepatitis deal. That was another bad deal. People were really concerned. “What’s going on in Las Vegas?” That kind of press has really caused us some heartburn.

We’ve never had anybody ask us about Yucca Mountain. Ever. “Well Yucca Mountain’s right there, what’s going to happen with Yucca Mountain?” Nobody’s ever asked us that. So it’s not a priority for them. It’s more about good government and good government doing good things for business and business being able to make a living and survive in a climate that’s regulated. “Don’t overregulate us and we love the fact that you guys want to work with businesses.”

I hate to disappoint the people that talk about this, because I’m a product of the school system here. There were 60 kids in my class at Rancho High School and the teacher had no problem taking control of it. It’s what nobody wants to look at behind those 60 kids in a class. It’s not that teacher’s fault. Our teachers had complete control. It was a very simple process because somebody at home, if they got a phone call, was going to whoop up you more so than the teachers, so you didn’t cause any problems. And the teachers had complete authority. So it’s a lot more than just having small classes. It’s taking the system and, I think, shaking it up a little bit and moving it around. My teachers were my heroes and there’s no reason why they shouldn’t be the heroes of the kids today that are going to school. It’s just not right that they’re not. Teachers were heroes for us. Had it not been for my teachers, I probably would have never gone to college. I was just happy kind of drifting through school. I was a pretty good student, but they made the difference.

You’ve been a major advocate for economic diversification for years, yet we never seem to gain any ground on that front. Why?

I guess my question is why is that all that I hear from the press? Everybody writes the story that diversification is not happening. It is happening. If you look at the numbers from Applied Analysis over the past 10 years, gaming decreased 9,000-plus (jobs) and the diversified sector increased almost 211,000. The diversified sector has outgrown, in jobs, gaming without any ifs, ands or buts. It’s not flashy.

It’s not sexy. It doesn’t get a lot of press, but it’s happening. We’re doing it with onesies and twosies. NDA only has relationships with so many companies. We know that the marketing we do is overwhelming and we know that there are companies that are coming here because of marketing the NDA does that we’re not sitting down with and talking with. But the diversified sector … God forbid, if this recession would have happened 10 years ago, because we were much less diversified — 20 years ago, even worse. I’ve seen the changes in this industry. We’re surviving this through diversification. The problem is we’ve got to diversify faster. It would be nice if we could get larger companies; it would be nice if we could get huge headquarters moves. That would be great. I don’t think that’s going to happen, but we’ve got to find a way to bring in more companies faster.

And we’ve got to expand our base, not just Southern California, but the rest of the country. Part of that depends on how much in dollars you have in marketing. Imagine if we had even 10 percent of what the (Las Vegas Convention and Visitors Authority) has. They do, I think, an incredible, wonderful job. If you want to test the LVCVA, it’s going to cost you a small fortune because a lot of people say, “Well, we don’t need that.” Do you want to take that chance and stop that marketing and find out what happens? I don’t think you do because it’s not a light switch you turn off and on because when you turn it back on, it’s going to take you five to 10 years to get back where you were. They do an incredible job. If you could sell the business side of this community like they do or even 10 percent of what they do, I’m telling you the numbers would be off the charts of people wanting to move here.

We’ve got companies we have brought here — we’re working them up right now — that have to be really careful when they come here from California because, believe it or not, they’re afraid to make statements because of the repercussions from the state of California. Just closing out your corporation over there is a nightmare. Sometimes they get tax bills after they’ve been gone for a year — goofy stuff like that that’s causing that state to go upside down. But we’ve had a couple of companies that have been over here for a while that say, “We will be more than happy to make some statements about why we’re here. We’re businesspeople. We were over there for a long time.” That’s what we’re looking for, companies that tell the rest of the world, “This is why I’m here. This is where you should be, guys, because you can do business so easily.”

The NDA has made efforts to recruit low-water-using, high-tech companies — companies associated with the medical industry, companies associated with the automotive industry to use the resources of the Las Vegas Motor Speedway. Has the strategy worked or will you have to broaden the horizon?

Our target industries are really stretch goals. And that is technology, life sciences, biotech and alternative (energy). Alternative, we’ve hit a home run. The fourth solar power plant just signed a deal with Boulder City, so it’ll start construction. We were in that before anybody said “solar.” But it was a stretch goal — we thought it was the future. Technology is happening in very small, boutique technology companies.

Again, we would love to get a major move here by a major technology company. I will tell you this, that we’ve got some big deals in the wind, but they’re not done. We’re not allowed to really talk about them. Hopefully, if any of those things come to fruition, it will be great. On the life science and biotech, we’re out there swinging and we’re out there swinging only because of the Nevada Cancer Institute and the Lou Ruvo (Center for Brain Health) and now, the Cleveland Clinic. That’s the only reason. The reputation of the Nevada Cancer Institute is wonderful across the country. What they’ve done is amazing in a short time. Lou Ruvo is just blowing people away and now with Cleveland Clinic doing a partnership with them, the credibility goes through the roof. We think there’s huge potential there. In the meantime, we recruit across the board.

Two things are happening. The state has asked us not to worry so much about the wages of a company if we can create jobs. We’ve always been hooked on the average state wage and if a company didn’t have a health program for their employees, we didn’t want to get involved with them. Why would we want to bring a company here that doesn’t want to take care of its employees? So the company had to have legs — it had to be an established company — it had to pay really good wages and it had to have some kind of a benefit program for its employees. Based on that, it gives us a chance to broad-base. So whether it’s manufacturing or whatever it is in California that we’re getting, we don’t really care at this point. We’re probably not going to spend a lot of time on a company that we don’t think is going to add positive things for Southern Nevada. It doesn’t behoove us to do that. We don’t want to create a situation where the state has to come in and pick up medical for people when they get sick. So that’s pretty much our guideline.

We talk to everybody, but we’re going to pick and choose who it is. We don’t encourage high water users. In Clark County, if you get a permit to build, you get the water. We don’t really want to be the stopgap but we certainly don’t want to encourage it. We just don’t think it’s a positive measure.

An emphasis has been placed on recruiting from California because of the high cost of doing business there with high utility costs, high taxes and onerous regulatory policies. Are there other locations in the United States that fit the same profile?

Yes. Here’s the problem and this is why we use California. What we have created that no other development authority in the nation has done is leveraged media. So California gets huge amounts of press before we got there. So it’s a natural thing for us to go next door where the move is a very small move and create a program that now has nationwide exposure. Even though we’re focused on California, the whole nation is seeing our campaign. That means high-income-tax and anti-business states like New Jersey, Massachusetts, New York — all those states that are having major problems and companies are moving out of. It allowed us to go nationwide and with our viral now, we’ve gone global.

I did an interview with the BBC and an interview with the Financial Times-UK. Everybody’s talking about this campaign. Think of it, just a million dollars a year for a campaign in California. It’s like standing in the street and you might as well throw it up in the air. But we’ve been able to leverage that into a huge amount of press that you literally can’t buy as far as advertising — you can’t afford it and you couldn’t buy it if you wanted to because a lot of it is front-page stuff.

That’s the method behind our madness and that’s why we go to California. New Jersey is so ripe, but you’ve got a 3,000-mile move. Boston is so ripe, but a 3,000-mile move. New York is so ripe, but a 3,000-mile move. So for me to be able to take my money and split up $250,000 a quarter and try to cover all these parts of the country, it’s not going to work. Focus, and let the press carry it from there.

Looking back on your career as the head of the NDA, what would you say was your biggest triumph in the recruitment game?

I think overall changing the whole face of this community. I owe this community everything. My mom and dad moved here in 1953 and dragged me along with a mattress on top of the car from Texas. Nowhere in this country can I imagine that my mom and dad could have had a better life and my dad could have been more successful except Las Vegas. If we would have stayed in Midland, Texas, it wasn’t going to happen. The greatest gift they gave me was moving here. I’ve been in love with this town since the day I got here. For me, this is payback.

If I could do this for free, I’d do it for free because this is the greatest city on the planet. It’s just got everything that anybody could want. Businesses can survive here, businesses can make it here. How many people do you know that came here with nothing in their pocket and made millions of dollars and became very wealthy and have given back to the community? It’s story after story. It’s not one of two. It’s thousands of them. So for me, the excitement and the triumph is being able to see this community change. When I grew up here, it was, “Do you want to go to work in a casino or do you want to go to work in a casino?” Nothing wrong with that. So many of us did. You could also get a job with the state if you got really lucky. Now, look at the choice the kids have.

Look at this university that we have that leads the nation in hotel administration but also has a great engineering school. By the way, the grads all get hired. They might not be hired here, but they’re hired. Their IT is second to none. One of the biggest complaints I heard here about IT from the university that after two years, the students are gone because somebody hires them, because they’re so good. They never finish school. So I think you’ve got a wonderful university out there. I think the solar research projects the university is doing are cutting edge. They’re doing cancer research out there that’s cutting edge.

The whole town has changed and the focus has changed. We can’t lose sight of the fact that what made it all possible for us was gaming. We don’t ever lose sight of that because that’s our baby. That’s the guys and gals that went out there and threw the dice and gave us the opportunity to be famous and when we became famous, we got to diversify because it became a business town, too. So that’s the thing I love best about this job and that’s the biggest win I ever had was this community.

What do you think about Kara Kelley leaving as CEO of the Las Vegas Chamber of Commerce?

I think she’s the best. She’s the greatest. Trust me, Kara already has something in place. Kara is very nonassuming in this respect in the “I don’t know what I’m going to do.” I promise you, she’s already made a move and it’s a wonderful move and I can’t wait to see what it is. She is a great lady. She is astute. She has done a great job and it ain’t easy running a nonprofit, let me tell you that right now. And she’s got a handful and she’s done a great job. It’s a great organization. We’re not going to lose her as a citizen and that’s the good part. She’s going to stay in Las Vegas, hopefully Las Vegas, maybe Carson City, but hopefully she’ll stay in Las Vegas. Whoever fills the slot, she’s going to be there — you saw that — to make sure whoever fills her slot is going to be as good as she is and you’re not going to have a downtime in the chamber. My hat’s off to her. She’s a great person.

Any thoughts on who would take her place?

Oh no. The only thing I would say is this, and I always say this, and I’ve told this to development authorities around the country: The biggest mistake a development authority makes is hiring somebody who doesn’t love the community. You’ve got to have a passion for the town. I don’t care if it’s Phoenix or Flagstaff or where it is. If you don’t love the town, you can’t sell it. And you’ve got to have a passion that says, “This is my town and I’m going to trample over anybody that gets in my way because I’m going to make sure that this town is a success.” They need to hire a local person that absolutely loves the town the way that she does and the way that I do. That’s the long and short of it. You know, it’s a downtime. You don’t want to change people out. She’s been there 14 years. I’ve been here 14 years. It’s not something you want to change out every year because you need that consistency and you need that broad base that you established and that’s what it’s all about.

Well you love this town. Are you interested in it?

(Laughs) No, I love the NDA. I’ve got this incredible board. No, I love the NDA. Wait a minute, how much does she make? (Laughs)

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