Another company splits anti-biz CA for TX

u-haul2June 26, 2013

By John Seiler

Despite the so-called California recovery, companies keep leaving:

Daegis Inc., the Roseville-based electronic discovery and information-management firm, said today in its quarterly financial report that it will relocate its headquarters to Dallas.

Tim Bacci, CEO of Daegis, said in the report: “As we evaluate the business and optimize our cost structure to accelerate on strategies where we see the most opportunity, we have decided to open an office in Dallas, Texas, and relocate the company’s headquarters there.

“Texas is a strong territory for our businesses, and we view this move as an opportunity to increase the company’s operational efficiencies and access an additional talent pool, as needed.”

“cost structure” and “operational efficiencies” mean Texas has much lower taxes and fewer absurd regulations.

In the past, California also was an essential place  of business because of its excellent pool of highly trained employees. That has changed. Other states, such as Texas, have increased in that area, what Daegis calls “an additional talent pool.” By contrast, California’s schools remain ranked among the worst in the country.

(Correction: A Steve points out below, it looks like taxes were not the consideration for the move. I guess I got carried away. I’ll leave the post up anyway with this correction. Thanks, Steve.)


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  1. Greg Schmidt
    Greg Schmidt 26 June, 2013, 13:24

    If I wasn’t so close to retirement, I would move my company out of this mess of a state. My son may make that decision to move, anyway.

    Reply this comment
  2. Steve
    Steve 26 June, 2013, 14:14

    How about, for once, reporting with just a shred of honesty? First of all, the company isn’t relocating to Texas. It’s opening an HQ office there, which some of its execs will move to. In total, that represents about 10 jobs. The company’s other employees will stay in Roseville. Second, a Sac Biz Journal report makes abundantly clear that the reason for this move has nothing to do with taxes or regulation. Finally, the reason it’s easier to find talent in Texas isn’t because there isn’t talent in CA. It’s because they have to compete with Silicon Valley, the tech capitol of the world.

    Are you so desperate to push an agenda that you willingly mislead or is this just extremely lazy reporting?

    From Sac Biz Journal:
    Daegis (NASDAQ: DAEG) has offices in New York, San Francisco and Roseville, and Dallas was considered to be a more central location, Thornton said. The company also considers Dallas an easier market in which to find developer talent, which is difficult in Roseville because it means competing with Silicon Valley for talent.

    The move is not a tax-driven relocation. The company is a Delaware corporation and has years worth of tax loss to carry forward.

    Reply this comment
  3. Hondo
    Hondo 26 June, 2013, 14:51

    Kalifornia, the greatest state in the USSA to be unemployed.

    Reply this comment
  4. OddThat
    OddThat 26 June, 2013, 15:18

    Steve, what you say about Daegis might be true but, there is no doubt that GAF is closing its Fresno plant. They will begin laying people off next month, through October. A loss of 60 jobs.

    Reply this comment
  5. Excalifornian
    Excalifornian 26 June, 2013, 17:07

    The key word is opportunity.

    Reply this comment
  6. Steve
    Steve 26 June, 2013, 17:46

    OddThat: If GAF is closing its Fresno plant and shedding jobs because of burdensome regulations or high taxes, then Seiler should write a blog post on that. Still doesn’t mean there’s an alarming trend, but at least the post would have some merit. It would be a contribution to a debate. But this is completely intellectually dishonest and damages not only Seiler’s credibility, but the credibility of CalWatchdog.

    Reply this comment
  7. Steve
    Steve 26 June, 2013, 17:49

    Sorry John, just saw the update with the correction. Thanks

    Reply this comment
  8. stolson
    stolson 26 June, 2013, 17:53

    Being in legal research arena here and internat’l, leaders report it is more difficult for small to mid size firms in CA to survive. With tough regulations, high costs for start ups and expansions, plus a changing social environment as to morals and educational attainment (not Silicon), plus a state that appears indifferent or even hostile to these employers–no wonder they consider a change of venue. It can start out as just 10 employees being moved to a small office out of state. Testing the waters.

    Reply this comment
  9. Dan Lombard
    Dan Lombard 26 June, 2013, 21:53

    Nice try Steve. Of course they wont disparage California, who would say bad things about a client? With respect to taxes, it ain’t the corporate taxes in question, and years of corporate carry forwards do nothing for the 15% personal income tax the top execs will pay on their salaries. California has a rotten government and wont be too much longer before it bites us all in the ass.

    Reply this comment

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