City officials react to Grass Valley, Miranda Technologies facilities merger
May 2, 2014
Belden broadcast brands Grass Valley and Miranda Technologies will merge into one facility in Grass Valley by the end of the year, leaving a 150,000-square-foot campus in Nevada City empty.
"I'm sorry to see them leave, but I am pleased to hear that many of the jobs will be staying in the region," Nevada City mayor Sally Harris said. "I'm really an optimist, and I'm very glad that this is happening when we're coming out of a recession, rather than in the depths of a recession.
"And so I'm hopeful that there will be some new businesses that will find the empty site very attractive to move into."
Grass Valley's senior vice president of switchers and routers, Scott Murray, said Wednesday that the Nevada City-based video company plans to merge its local and global facilities, while downsizing its workforce.
Grass Valley and Miranda, two formerly separate video companies, will move into the same building in the Whispering Pines business park in Grass Valley, where the Miranda offices currently reside, and move out of Grass Valley's current location on Providence Mine Road in Nevada City.
Nevada City manager David Brennan said Thursday that because the city will be losing a profitable company, they will begin to transition its budget, by placing all tax revenue received by the video company into the city's reserves.
"I don't know when they're going to be moving their point of sales to another location," Brennan said. "But if they're still using Nevada City as a point of sale by July 1, we will be segregating that revenue, and holding that as a reserve."
Brennan would not reveal how much annual tax revenue Nevada City will lose when the Grass Valley company, which was purchased by Belden in February, moves, but said that the amount varied depending upon their sales.
Former Nevada City Treasurer George Foster, who resigned in 2009, said the Grass Valley and Miranda facilities merger is a huge loss for Nevada City on multiple levels.
The former city official said Thursday that the city will lose sales tax for products sold in Nevada City, as the company's employees are more likely to purchase items where they will be working, in Grass Valley.
Foster also said the city will lose a usage tax, which charged the company a fee for products they bought and used in Nevada City.
"If they buy something in Iowa, and use it in Nevada City, they pay a sales tax," Foster said. "This is a real kick in the pants for the city, and a major loss to their budget."
During his time in office, Foster recalls being told by another city official that when Grass Valley first moved their operations into Nevada City, the city's tax revenue increased by $500,000.
Foster also said that no more than 10 years ago, 25 percent of the city's tax revenue came from the video broadcast industry, and the Grass Valley Group, known to locals as "The Group," was one of, if not the biggest, video company in the city.
Grass Valley Mayor Dan Miller said that although Grass Valley will reap financial benefits from the company's facility merger, it is unfortunate that Nevada City will be losing the company's campus.
"I'm certainly not jumping up and down saying it's good that Grass Valley got it, and Nevada City lost it. It just doesn't work like that," Miller said.
"We're a community, and I think we need to now take a look and see how we can fill the vacancies that are going to now occur in Nevada City."
Miller added, "The positive is that they didn't close down the facilities and move someplace else. And so what we've got to keep in mind is we've got to make our area attractive, so that if something like this does happen where a larger company buys one of our smaller firms, that they're sensible enough to recognize that this is still a great place to do business."
Jon Gregory, the executive director of Nevada County's Economic Resource Council, said Thursday that the company's facility merger was a global business decision with an unfortunate local effect.
"At a global level, they are undergoing a restructuring, and when you have companies that have merged in two separate locations at the corporate level, if they've got two entities that are doing the same jobs they obviously have to eliminate some of the redundancies," Gregory said. "On the flip side, it strengthens the entity in servicing its customers and hopefully that for the long haul, maintains the core base of what we have here in Nevada County."
The company was originally founded by Donald Hare in 1959 as the Grass Valley Group. In 2002, French media technology group Thomson acquired Grass Valley Group, but would eventually sell the company in 2011 to Francisco Partners, a San Francisco-based investment firm.
In February 2012, at least 34 Nevada City employees were to be laid off by the video manufacturing firm, according to a memorandum from Nevada County CEO Rick Haffey. In 2009, Grass Valley had nearly 300 employees at its Nevada City facility, according to a former employee. Following a 10 percent reduction, the company had around 270 employees in 2011.
Last year, Grass Valley had between 100 and 249 employees, according to California's Employment Development Department. The company has won more than 20 Emmy awards, and has around 400 product patents. All inquiries in obtaining the company's current and future layoff numbers have been unsuccessful.
Christine Hoxsie is a staffing specialist at One Stop Business and Career Center, a nonprofit group in Grass Valley that helps unemployed and laid-off locals. Hoxsie said that it's a challenge for her organization to help employees during large layoffs and business closures when the group doesn't know how many people are being laid off.
"But what we have is a program called "Rapid Response," and we're actually tasked by the state to assist businesses when they have a large layoff or a closure," Hoxsie said. "Ideally what we do is come in before the business closes and meet with all the employees that are going to be affected and share our services and how we can help them."
In reference to the Grass Valley and Miranda merger, Hoxsie added, "We are in touch with both organizations and they are aware of what we do and we've helped Grass Valley group in the past with some of their changes. They're following their processes, and we're going to be working close with them to make sure they know who we are and what we can do, so they've been great to work with during this process."
To contact Staff Writer Ivan Natividad, email firstname.lastname@example.org or call 530-477-4236.
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