Courting Nike

Butch Otter Courting Nike at Midnight (apologies to Norman Rockwell)

Banner Headline in the Idaho Statesman–

Dan Popkey: Could Nike swoosh into Idaho?

Answer- No.

The Idaho economy is in the dumpster with plunging tax revenue after the housing boom of the last decade crumbled, numbers of unemployed swelling to nearly 70,000, and record numbers of people applying for food stamps. The legislature continues gutting state agencies and higher education in order to balance the budget. Governor Otter writes a whining editorial complaining about the unfair treatment he has received in the media:

There was a time when most newspaper columnists at least paid lip service to the good intentions of public officials. They might be misguided, shortsighted or simply stupid, the writers would suggest, but at least they meant well.

His complaint? Reporters claim that he wants to make the draconian cuts and to shut down state services.  He doesn’t want to make the cuts, he is forced to make them.* He has no option because,

…the political reality [is] that nobody wants to raise taxes – especially in an election year

That says it all. With no way to increase revenue, our state leaders are forced to dream. Maybe, just maybe, a billionaire will come and save us. Maybe, just maybe we can court someone like Nike’s Phil Knight to leave business hating Oregon and come to Idaho. Yeah, that’s the ticket!

Which leads us to the story under the banner headline:

Nike founder Phil Knight is hopping mad at $727 million in tax increases on corporations and the wealthy in Oregon. Idaho leaders long to catch their rich neighbor’s eye.

Idaho has wooed Nike before – a revelation offered by Lt. Gov. Brad Little, who salivates at the prospect of landing one of the world’s best-known brands.

He showed the company a 640-acre parcel he owned north of Eagle as a possible site for a satellite campus. Little’s land included a piece of Goodale’s Cutoff, a branch of the Oregon Trail. “These guys were going to spin it to Nike that they could go out and run on the Oregon Trail.”

Department of Labor Director Roger Madsen helped develop the pitch. “We created a beautiful video that showed a lot of people in athletic situations – golfing, skiing, tennis, running – wearing Nike apparel,” Madsen said. “It was very attractive.”

The 1990s search was driven by complaints about multiple taxing authorities in Oregon, said Jeff Malmen, Gov. Phil Batt’s chief of staff, who attended a meeting with Nike executives in Batt’s office. The visit likely occurred in 1997, according to the best recollection of several officials.

Nike also looked at Washington, Nevada, Colorado, New Mexico and British Columbia. In the end, the company resolved a dispute with Beaverton and expanded what is now a 193-acre campus with 17 buildings named for Nike-affiliated athletes.

Little takes heart knowing Nike seemed keen on Idaho. “They’ve got a high frustration level with governance in Oregon and they’ve been here before,” Little said.

So, Little is “salivating” because he wants Nike to purchase and relocate on land he currently owns?  The spin is that Nike athletes could run on the Oregon trail? They created a beautiful video showing lots of people in athletic situations?

Okay, so the pitch might not have worked in 1997, but now that Knight is “hopping mad” it just might work this time around.

Gov. Butch Otter also has Nike on the brain. He’s working on a legislative package to lure business. Otter said he seeks “incentives for folks to take flight from Oregon and come over here, because we’re getting a lot of phone calls about their tax increase.”

There are a couple of reasons Nike is not relocating to Idaho.

Number one, Knight is a smart businessman and will be aware that the tax situation in Idaho is not all that conducive to business. According to the just released State Business Tax Climate Index for fiscal year 2010, Idaho ranks below all of its surrounding states, including Oregon: Wyoming #2, Nevada #4, Montana #6, Washington #9, Utah #10, Oregon #14 and Idaho #18. When Butch goes courting, he better realize that Nike’s other suitors will have more that a nice video and a box of candy.

Number two, hidden deep in the Statesman article:

Nike spokeswoman Erin Dobson wouldn’t comment on the company’s interest in Idaho in the 1990s. But she ruled out Nike moving its headquarters from Beaverton, writing in an e-mail, “Nike has no plans to relocate.”

Economic midnight is approaching. I Just hope a desperate Governor Otter doesn’t refuse to take Nike’s “no” for and answer and move from courting to stalking.


* If that is what he wants, I, for one, will be happy to concede that while Otter means well, he is misguided, shortsighted and simply stupid. The Mountain Goat Report has more on the Governor’s hypocrisy here.


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