SAN DIEGO - What Proposition 30 opponents said they were afraid of may be happening. A Phoenix-based economic development group is trying to woo California small business CEOs who may be more willing to go to Arizona now that the proposition has passed.
10News learned at least two San Diego companies are thinking about it.
It begins with a free flight and accommodations in Phoenix for up to 50 California CEOs.
"We've already had seven CEOs that have committed to come into the market and the program's only three days old," said Barry Broome, the president and CEO of the Greater Phoenix Economic Council or GPEC.
GPEC's program called California 50 is a full-court press to entice small-business CEOs to move their headquarters from the Golden State to the greater Phoenix area. Phoenix has long prized California companies, so why this program now?
"There's going to be a straw that's going to break the camel's back and we're going to test the waters on this recent tax obligation," said Broome.
That obligation is Proposition 30, which raises sales tax by a quarter-cent for four years, and for seven years, it boosts income tax by up to 3 percent for Californians making more than $250,000.
"There are 3.8 million businesses that file their income taxes as individuals and those people are going to be hurt," said Paul Robinson, who is with the Lincoln Club, a San Diego business group that opposed Proposition 30.
He says he does not blame Phoenix for seeing an opportunity.
"It's just the beginning," said Robinson, who says states like Texas will come calling to seize this opportunity too.
If GPEC has its way, lab and office space in San Diego will start to empty out because they are specifically targeting life sciences, technology and financial companies in particular with 200 or more employees.
GPEC's website promises 40 percent lower operating costs, faster permitting and lower home costs.
However, there is one thing Phoenix cannot promise.
When asked what California offers that those other places do not, Robinson said, "The climate."
GPEC would not divulge which two San Diego companies are checking out Phoenix, just that they are life science/medical device companies. GPEC says getting a CEO to leave beautiful San Diego would be a major coup.