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When States Entice Companies To Move, Workers Are Left Behind

ROBERT SIEGEL, HOST:

Throughout the country, states compete with each other for businesses. There are winners and losers. Noel King from our Planet Money podcast has the story of some of the people left behind when a company crosses state lines.

NOEL KING, BYLINE: About a decade ago, Applebee's was based in Kansas. They wanted to build a high-end new headquarters. They went to Blake Schreck. He's head of the Chamber of Commerce in Lenexa, Kan. It's his job to get and keep companies in Kansas. Applebee's told him they wanted to stay but...

BLAKE SCHRECK: You know, we're a pretty big deal and we can go wherever we want to. And we may, you know, go to Missouri or we may even go to Dallas. So what can you do for us?

KING: The company wanted a break on property taxes. It was a tough call.

SCHRECK: Our feeling was a little bit at the time that just wasn't done. If you really want to be in our community, you need to pay full boat.

KING: But it was around 600 jobs plus corporate taxes and the tens of millions and a fancy new building. So Kansas gave Applebee's about $12.5 million in tax breaks. This is something a lot of states do to keep or attract companies. In fact, neighboring Missouri has its own tax incentive program. And a few years later, Applebee's was on the move again. This time Missouri snatched the company offering their own package of tax breaks. Kansas lost them.

SCHRECK: It's pretty frustrating only because this was a high-profile deal. I mean, this was one that was going to be in the papers.

KING: It was. Missouri treated it as a win for job creation. A couple days ago, I stopped by the headquarters.

Let's just go see. OK, going in the lobby. Hi, good morning. How are you?

There in the lobby, I met a guy named Dion Crooks (ph). He's a facilities manager here and he told me a story that's not about job creation though. One day last fall, he came to work in a great mood. There was a staff party. Everyone was going to watch the Chiefs-Broncos game.

DION CROOKS: We had beers, and, you know, hot dogs and, you know, everything set up. Then about an hour later, I got a email to say that we have to do a room set up for 300 people.

KING: It was an all-staff meeting. He set up the conference room.

CROOKS: We got upstairs. We walk in the door. Our CEO was - she's the first person we saw when we walked through the door. Not only did we saw her, we saw every department head from every department.

KING: Not a good sign. When the CEO got up to speak, Dion says, she told them that Applebee's was leaving Missouri for California. And a lot of people in that room were going to lose their jobs.

CROOKS: It was kind of a big sigh in the entire room. And then the next thing everybody's head went straight down to their phones. And I personally got up and walked out. I didn't hear the rest of what she was saying. I came back downstairs went into the office and kind of sat there for a while.

KING: Some people got transfers to California. Dion wasn't one of them. We reached out to Applebee's and the company told us the move to California was not about tax incentives. And Dion's not mad. He gets it. The company that runs Applebee's is based in California. But when he thinks about the office Christmas party a couple months after the announcement...

CROOKS: Not this past Christmas, the before last, it was just so fun and energetic and everybody's in the spirit. Oh, man. It was great. Then this past Christmas, it was just kind of like, I'm here. I won't be here next year. And I'm going to do what I can to keep a smile on my face, but it's not, you know.

KING: And this is what job creation looks like sometimes. Some jobs for Missouri headed to California and a guy left behind trying to smile through a Christmas party. Noel King, NPR News. Transcript provided by NPR, Copyright NPR.

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