Regulatory red tape is a red flag for business in California

Last week, the Metro Board of Directors was informed by Kinkisharyo International, who was contracted to build new Metro rail cars, that the company was withdrawing plans to construct a manufacturing plant in Los Angeles County. Instead, the firm is looking outside of California to build their new facility—taking thousands of long-term, well-paying jobs with them.

Kinkisharyo’s decision to abandon Los Angeles County stems from a dispute with a local labor union group over the unionization of new workers and a frivolous lawsuit that has put the company’s reputation of delivering projects on-time in serious jeopardy.

Once again, California and Los Angeles County are left out in the cold due to the State’s anti-business climate.

Just this year, Los Angeles County has lost major investments from Toyota, Nestle, Sunkist and other corporations. Thousands of individual jobs have been lost, and the impact on small business has been significant.  But, thanks to this latest nonsense, I fear that Kinkisharyo’s departure could be the most damaging of all.

It’s been said time and again by business interests and labor alike: for our State to be strong, we must all work together to retain jobs and create new jobs.  This cannot be done with petty lawsuits and infighting. It’s done through partnership and dialogue.

The loss of Kinkisharyo to the County is disastrous, and pulls the chair out from under a region that is still recovering from the crippling recession. The debacle between an international firm and a local union is representative of the State’s inability to cut the red tape of regulations and lay out the welcome mat. Instead, it’s a red flag to anyone considering California as a land of opportunity for business.