A California pump company from Sonoma's wine country has announced it will relocate to Caldwell before the end of the year.
Price Pump Manufacturing Co., an 86-year-old company that has operated in Sonoma for 70 years, bought 6 acres of land in the Sky Ranch Business Center for about $486,000. The company plans to build a 40,000-square-foot plant at the industrial site east of Interstate 84 and south of Franklin Road.
The high cost of manufacturing in California made it more difficult to compete with other sellers in the United States and across the globe, president and CEO Bob Piazza said. He said the marketplace helps determines prices, and Price Pump could not simply raise prices to maintain a reasonable return on investment.
"The options were to slowly go out of business, sell the business or move it," said Piazza, 74. "We did not want to sell, so that really left us with one choice and that was to move."
Steve Fultz, Caldwell's economic development director, said it's a "great win for Caldwell to have a manufacturer of their caliber come in."
Price Pump purchased the land at below market value from the Caldwell Urban Renewal Agency in exchange for the company's investment and job creation opportunities. The company will also receive a property tax exemption for up to 75 percent for five years and a job creation grant of up to $200,000.
Price Pump spent several months looking at other cities throughout the country, including Reno, Las Vegas, Austin, Atlanta and Charlotte before choosing Caldwell. The move was first reported by BoiseDev.com and the Idaho Press Tribune.
From California to Caldwell
Half of Price Pump's 36 workers have agreed to follow the company to Idaho, which surprised Piazza.
"When we first decided to do this — I mean, the board of directors — I told them I would be surprised if we get anyone besides myself to go up there," he said.
About a dozen employees took company up on his offer for a three-day, all-expenses-paid trip to check out the Treasure Valley before deciding whether to move with the company. For the 18 who will join the company in Idaho, Price Pump will pay up to $12,500 apiece to cover moving expenses. Four employees have already bought homes in Nampa and Middleton, he said.
For most of the employees who decided to stay in California, including Piazza's daughter, family ties made it difficult for them to leave, he said.
One employee Piazza didn't expect to move was a 66-year-old machine shop supervisor who grew up in Sonoma and has worked for the company his entire 46-year career. When he first heard the company was moving, he was thinking about retiring, figuring it would be hard to find another job at his age. He later decided he couldn't afford to retire then in California.
The man, whose father-in-law had also worked for the company, told Piazza he wanted Price Pump to be successful in Idaho and that he wanted to be part of it.
"I get to work until I'm 70. I get to work at something I know and I do well at, with a company I know. And I get to relocate to a lower-cost area where I can retire," Piazza said the man told him. "He said the best part about it was that we're going to pay for his move."
Another worker who has been with the company for 31 years lost his home during the Great Recession around 2008. He looks forward to coming to Idaho, Piazza said, so he can continue working for the company and buy another house.
Idaho's business friendly climate was an important factor, along with lower income and sales taxes, Piazza said. He said the state of California and Sonoma County had over-regulated businesses.
Lower property values will result in lower property tax bills for both the company and workers, he said. And employees will be able to buy homes for half the price of those in Sonoma County, said Piazza, who has headed the company since 1992.
The median price for homes sold in Ada County during the first quarter of the year was $297,000, while the median price in Canyon County was $201,100, according to a report from the Intermountain Multiple Listing Service. In Sonoma County, the median price in March was $639,000, double the price five years ago, according to the Press Democrat newspaper.
Other factors for the move
Another factor for Price Pump's move was the presence of one of the company's three owners in the Treasure Valley. John Paul owns Morse-Starrett, a Meridian company that manufactures wire rope cutters and has operated in Idaho since 1986. His father, Leon Paul, bought Price Pump in 1962. John Paul, as well as his his brother, Jerry Paul of Darby, Montana, and Piazza are Price Pump's three shareholders.
John Paul was out of state on Monday and could not be reached for comment.
Price Pump was founded in 1932 in Emeryville, outside Oakland. It originally manufactured agricultural pumps. It now focuses on centrifugal and air-operated diaphragm pumps for industrial uses.
Piazza declined to provide the privately held company's sales figures, but he said manufacturing companies in that sector generally earn more than $250,000 per employee. That would indicate yearly sales of at least $9 million.
Price Pump is giving its workers who remain in California a 10 percent bonus to continue working until the Sonoma factory closes, likely in November. The company is also providing assistance to help workers find new jobs, Piazza said.
The workers who come from California will continue to earn the same salary. Workers hired in Idaho will be paid at rates comparable for this area, Piazza said. He said company benefits tend to be better than those offered by most Treasure Valley companies.