The Best States For Business

[okclee]

The Best States For Business - Forbes.com


1. Virginia
2. Utah
3. North Carolina
4. Texas
5. Washington
6. Idaho
7. Florida
8. Colorado
9. North Dakota
10. Minnesota

30. Oklahoma


I am sure that this is some sort of media bias against Oklahoma or something like that. j/k

[HOT ROD]

^^ We need to turn this around guys!!!

North Dakota, Idaho, and Utah more business friendly than Oklahoma??? Something's wrong with this picture!

I guess it's too bad OKC isn't a state, otherwise Im sure it would have been ranked pretty highly!!

[betts]

Could it have anything to do with our lack of tort reform?

[Midtowner]

Could it have anything to do with our lack of tort reform?

Betts, go educate yourself on the kind of tort reform the legislature tried to ram through in the last session. SB507.. go read it.. then get back to me

That sort of tort reform could more accurately have been described as "The Protect Corporations' Ill-Gotten Profits Act." One of the provisions would have provided a very simple mechanism (and this is just one example in an 80+ page bill) for a nursing home, having discovered a dangerous condition which has injured someone to take anything about that condition which they know about completely out of the reach of courts as far as being able to present it as evidence. Another provision made it unlawful for royalty owners to sue oil and gas companies on unpaid royalties in class action (meaning that if Chesapeake, a big pusher of this provision decided to short you a few bucks on every single check, there wouldn't really be anything you could do to get them to follow through on their end).

I'm all for some *HONEST* tort reform, but no sane, informed person would want anything to do with that terrible piece of legislation from last term.

[dismayed]

It's too bad that OKC is getting held back by its not-so-business-friendly state government.

[gmwise]

hey its Oklahoma State Goverment's way of saying, we miss our bribe structure.

[BDP]

Could it have anything to do with our lack of tort reform?

Actually this study suggets that it has nothing to do with our regulatory environment. Our highest ranking came in the regulatory environment column (14), which includes tort climate. Our real problems are Quality of Life (36) and Labor Rank (47). So education, health, crime, poverty, and net migration are much bigger problems according to this study. Which makes sense. The bottom line is about people. You can give away the farm, but if it sucks to live and work there, it just doesn't matter what the cost is to most people. Most people and businesses will choose a better life over lower cost when they can afford it and many businesses can afford it.

Oklahoma has long been a testament to this. With its pro-businesses mentality and low costs associated with doing business, we're supposed to have businesses knocking down our door to set up shop here, right? Nope. People want a good life. Cost savings and government limitation of liability are simply factors in that equation for some (and only in the protected sectors), but they do not educate the work force, produce healthy living standards, spark creativity and innovation, or make people want to raise a family there. Most people, and businesses are run by people, want a good life and realize that may cost more. Oklahoma will have to create an environment with exceptional quality of life to add to its low cost of living to compete in the future. We keep trying to fix the cost equation and, honestly, its not broken. We're as cheap as they come. It's time to create substance and create an educated work force that wants to live in Oklahoma.

[soonerguru]

The GOP in Oklahoma first said passage of right to work was essential to growing our economy. Remember Keating proclaiming that there would be a "stampede" of manufacturing jobs once right to work was passed? Didn't happen.

Now, the same GOP is using its main fig leaf, The State Chamber, to convince people that giving up their rights to sue and get damages from a corporation that has wronged them is essential to growing our economy.

Look, the malpractice arguments and all of the other bunk hurled by this group have been steadfastly disproven by cold-hearted analysis. OU studied the issue and found that doctors were NOT leaving our state due to the tort environment, despite the lies of the GOP and their cronies to the contrary.

Think about what propelled MAPS in the first place: The people of United Airlines told OKC 'thanks but no thanks' not because our incentive package was lacking, but because their employees didn't want to live here. Clearly, we have made serious efforts to improve our city since then, and it's paying off. Not because we went on a tax-cutting frenzy, but because we have invested more in our city and created a more attractive setting for people to live and work.

Oklahoma's economy will soar when more people want to live here. It's that simple. In the 21st Century, in order to compete, you must first have a first-class workforce. That means an educated work force. If we cannot attract the top-tier employees, we will always have hog processing plants as the alternative. If we cannot attract an educated work force, we can create one, by doing a better job of educating our citizens.

You don't attract great, creative workers with reductionist, right-wing government and policies, that much is certain. Oil company employees, maybe, but no one else. That's why so many people here clamor for changes in our liquor laws and improvement in things heretofore ignored by chambers of commerce, like our nightlife variety, our dining options, and the cultural attributes of our city.

The two most expensive places for businesses to operate in the US are California and New York, and they generate more for our country's GDP than probably all of those states combined. Should we tax business as aggressively as those states? Absolutely not. But this theory that we need to be the cheapest place on earth is a guaranteed failure. We need to invest in Oklahoma to improve our quality of life, our citizens' education attainment, and most of all, our civil and transportation infrastructure.

Face it: if we can improve our infrastructure, education level and quality of life, we will be an attractive place to live and work. That's what drives people to this site: the civil discussion of ways we can improve our city.

Tax-cutting is great in theory, but if we don't have money to provide for quality infrastructure, and yes, that includes transportation, this will ALWAYS and forever be a middling state, economically.

[mecarr]

Could it have anything to do with our lack of tort reform?

Tort reform is just a way to protect corporations from manufacturing faulty products. Look, if corporations would simply act responsible in how they design and manufacture their product, then they wouldn't have any problem. It's just the fact that they sometimes put greed above safety, and the only way for them to change their way is to hurt them in the pocketbook.

[Midtowner]

Not to worry folks -- not even the elected officials who proposed the last round of tort reform really understood what the hell they were proposing. Glen Coffee looked like a complete jackass when he was answering questions about the bill and had to refer (several times) to the lobbyist who wrote the bill for answers.

Want to seriously cut into the cost of litigation? Hire about twice the number of judges we have now and we'll be there. A huge part of our problem is how long it takes to litigate cases. It's not because our judges are lazy, it's because most of them handle several thousand cases more than they should per year.

[betts]

Here's an interesting read from the Times-Picayune. Although it's about New Orleans, it has applicability here.

What's Houston got that N.O. doesn't? Plenty - Breaking News Updates New Orleans - Times-Picayune - NOLA.com

----- August 2007 July 2007 June 2007 May 2007 April 2007 October 2006 What's Houston got that N.O. doesn't? Plenty
Posted by Pam Radtke Russell, Business writer August 04, 2007 10:27PM
Categories: Breaking News
As an accountant at KPMG in the 1970s and 1980s, Joe Bennett saw many of his clients, stalwart New Orleans oil companies, move to Houston.

"I sat there the whole time thinking, 'What the hell is so attractive about Houston?'¤" Bennett said.

But after relocating to the Texas city after Hurricane Katrina, Bennett, a senior vice president and chief of investor relations at Tidewater Inc., finally understands why the city he and other New Orleanians once considered a nuisance is such a draw for the energy industry.

"What I see is a much bigger town. There are public companies all over the place, a work force that is phenomenal, ... opportunities that are phenomenal," Bennett said. "The city is growing by leaps and bounds. When you drive around you say, 'My God, look at the businesses here.' "

Houston has 501 public companies and 915 public and private energy firms. The New Orleans region has just 11 public companies, and the local energy sector comprises 45 public and private firms, according to an analysis by the energy-focused investment firm Howard Weil. That mass of companies makes it difficult for an oil and gas company to do business anywhere but Houston.

"There's vibrancy and intellectual activity," said Dean Taylor, chairman, president and CEO of Tidewater, which operates the world's largest fleet of offshore supply vessels for oil and gas companies. "It's where ideas are being germinated and seminated. It's business-friendly. It's a city that works in every facet."

Taylor, Bennett and other senior management at Tidewater are weighing those positive attributes against the company's 51-year history in Louisiana. Earlier this summer, Taylor said some Tidewater executives, and the company headquarters, may move to Houston.

Tidewater would become the latest in a string of local energy firms to make such a move. Major and smaller energy companies alike, from Exxon Mobil to Newpark Resources, have relocated their entire operations to Houston over the past two decades. The number of people employed in oil and gas production statewide has gone from an all-time high of 94,722 in 1981 to 41,179 in 2005.

The departures only accelerated after Katrina, when many local energy companies temporarily set up shop in Houston and, like Bennett, saw firsthand the benefits of operating from that city. At the same time, Houston has become an aggressive economic recruiter, actively courting energy companies and tailoring incentive packages for them. Oil executives say the continuing exodus to Texas isn't a slight on New Orleans but more about the need to be in Houston.

"We make it about New Orleans, but it's not really about New Orleans. It's about Houston," said Jeff Parker, president of Howard Weil, which is based in New Orleans. "Houston is the Mecca of the oil business. It is strategically the most important city in the U.S., and probably around the world, as far as the energy business is concerned."

New Orleans, meanwhile, neglects its businesses, a situation that has worsened since the storm, executives say. That indifference, when combined with the city's high rate of crime, troubled schools and anemic health care system, makes it hard for some to stay.

"It's not just oil companies, it's all companies. They are all leaving New Orleans because of mergers and acquisitions," said Don Briggs, president of the Louisiana Oil and Gas Association. "They are leaving New Orleans because it's not safe. Quality of life is not like it used to be."

City and state leaders say they are reaching out and working to resolve the problems that plague New Orleans businesses.

"Gov. Blanco has done more for (the) oil and gas industry than any governor I've ever worked with," Briggs said.

The hard truth, though, said Mark Drennen, chief executive officer of the economic development group GNO Inc., is that the city has a long way to go. "In the short term, we're still not competitive," Drennen said.

In the future, Drennen and others say, New Orleans will play a small supporting role in the oil and gas sector, with smaller exploration and production and service companies run by locals taking the place of the huge multinational conglomerates that once had their feet in New Orleans.

"I don't see New Orleans being a major oil and gas hub again," said Frank Glaviano, vice president of Shell Exploration & Production, the only Shell vice president in New Orleans. "I don't see it returning, Houston has captured the oil and gas companies. Clearly, Houston is the hub."

And Parker doesn't even take for granted that the smaller companies will be in New Orleans.

"We have not taken the steps over the years to maintain the companies, let alone attract more," he said. "We must take initiative or we will see more of the same."

It's not news that oil and gas companies are moving from New Orleans to Houston. It's a trend that started in the 1980s with the downturn of the oil and gas business

At the time, "New Orleans was really an oil center, certainly way more so than it was today," Bennett said.

In the late 1970s and 1980s, oil executives in New Orleans met for business lunches at Galatoire's, Brennan's or Kolb's and sealed deals over drinks at the Petroleum Club, Briggs said.

Even then, though, Houston had an edge on New Orleans because it had a more business-friendly environment and a better public school system. "Houston was just a better market to operate and live," Bennett said.

When the oil bust came and companies began consolidating offices, businesses looked anyplace but New Orleans.

"This was the oil capital, this is where it was, it was an amazing place," said Clint Coldren, president and CEO of Bayou Bend Petroleum, a relatively new exploration and production company based in the city. "To see that disappear is disappointing."

As the number of energy businesses in Houston grew, it became more and more difficult for those who remained in New Orleans to ignore Houston. Companies opened satellite offices or sent people more frequently to Houston. The state of Louisiana even opened Department of Revenue offices there.

Even though many of the energy companies still have a majority of wells, shipyards and employees in Louisiana or off the state's coast, companies increasingly have concentrated their business activity in Houston.

Over the years the New Orleans energy sector has suffered blow after blow. The most recent prior to Katrina was Exxon Mobil's 2003 move to Houston. At that time, there was still optimistic talk about luring oil companies back to the city and the state. Later that year, the City Energy Club, the successor to the Petroleum Club, ceased to exist. "It's a sign of the times (when) you don't even have a Petroleum Club," Parker said.

When Katrina hit, it was easy for the energy companies based in New Orleans to set up camp in their Houston offices.

By the time floodwaters subsided, many of those companies had found Houston to be more conducive to business than New Orleans.

"Once you get out of the city, once they enjoy the benefits of no income tax, it's harder and harder to get them back," Drennen said.

Before deciding whether to return to New Orleans, Energy Partners Ltd. took a look at the economic advantages and disadvantages of staying in New Orleans. It boiled down to one thing, said Phil Zanco, director of tax at Energy Partners.

"In a nutshell, if you want to get to the gist of the matter, Texas does not have a personal income tax," he said.

And the entrepreneurs and executives who are making decisions about where to build businesses pay a hefty portion of state income taxes, he said.

In light of that, along with relatively high property tax and a shortage of good schools in New Orleans, "I think you have a pretty big drag to the class of folks that are entrepreneurs," he said.

A homeowner with a $150,000 home with a homestead exemption will pay about $1,300 in property tax in New Orleans. Depending on the school district, a $150,000 home in Houston will cost between $1,481 to $2,700 in property tax. But Zanco said the burden of income tax can outweigh that of higher property taxes.

But it's not just income tax, said Taylor, whose primary residence is in Mississippi. Other tax breaks and incentives offered in Texas make the pot sweeter in Houston. Perhaps more important, Taylor said, is the vitality of the energy industry and the appealing business climate in Texas.

Tidewater is one of several energy companies that balked at returning to New Orleans after the storm. Energy Partners and Chevron also held out, waiting for more reassurance from the city and the state that it would be good business to do business in Louisiana.

Ultimately, the state developed a package of $10 million in incentives for Tidewater. Tidewater turned those incentives down because it said it didn't need the money, but it still returned to the city in 2006.

The company left three executives, including Bennett, in Houston. Energy Partners returned with its full force of employees. But Chevron returned with just 600 of the 1,000 employees it once had in New Orleans and has since announced it will move to the north shore this year. And even Shell, lauded for returning 1,000 of its employees to New Orleans, left about 400 employees who wanted to remain in Houston. The company has the largest energy work force in the area and had made a long-term commitment to it.

W&T Offshore, which had about 100 employees in Metairie and 25 in Houston before the storm, has switched that distribution and has only about 25 employees remaining in the area.

Murphy Oil, which returned with about 100 employees after the storm, closed its New Orleans office last month. And others, including Newpark Resources and McDermott International, quietly pulled up stakes and never came back after Katrina.

"Our old headquarters are still uninhabitable," said Jay Roueche, vice president of investor relations at McDermott.

McDermott's New Orleans office was on Poydras Street in the Dominion building, which still sits unrepaired after almost two years.

Dominion Resources itself scrambled to find new offices so it could return to the city, but since then, the oil and gas operations that were based here have been sold to Eni SpA of Italy. The company remains in the city, but industry executives say they probably will relocate to Houston.

The Minerals Management Service, which manages offshore leases and holds biannual lease sales in New Orleans, returned to the area, providing one vital link to New Orleans for the entire energy industry.

The cost of losing jobs to Houston is hard to quantify. Although Tidewater would exit the city with only five executives, leaving its staff of about 85 in the city, the departure of those highly paid executives impact the city heavily, said Mike Olivier, the state secretary for economic development.

"The loss of those high-end jobs, even if it's few, it's still important because those high-end jobs generate a lot of economic benefits. They buy two Mercedes instead of two Chevrolets, they invest locally," Olivier said.

Drennen also said when companies and executives leave, they take with them community support and leadership.

"Tidewater has been part of the city and economy for 50 years," he said. "You don't ever want to loose that kind of relationship."

It took the forced relocation to Houston for Tidewater executives to see what Taylor had been telling them about the city. "They didn't understand it until they were there," he said.

Industry executives say it's not one single thing that is pushing them out of New Orleans. Similarly, a combination of factors makes Houston the hub that it is.

"How do you define vibrant? You just feel it, you sense it," Bennett said.

In Houston, energy is "the thing," said Al Petrie, a New Orleans energy consultant. "It's the heart of the city." About half the city's 2.2 million jobs are related to the energy industry.

Many executives talk about the "deal flow" in Houston, where prospects are traded at lunch and customers are picked up during casual conversations. Briggs, of the oil and gas association, likens it to the financial activity and camaraderie of Wall Street.

David Heikkinen, who opened an office of the financial firm Pickering Energy Partners in New Orleans after Hurricane Katrina, agrees.

"The gravity pulls you in. Most of the business and most of the people in the energy industry are here, and if you're trying to build a business it's where you want to be," he said.

Heikkinen moved to Houston this year, but the Pickering branch remains in New Orleans.

John P. Laborde, a founder and former president, chairman and CEO of Tidewater, is an advocate of keeping the company based in New Orleans and says much of the business of oil and gas can be done by a sales force in Houston.

But Parker, Taylor and others say nothing can take the place of face-to-face meetings.

"CEO to CEO, you can get a whole lot done," Parker said. "Salesmen can bring something to the altar, but I can get the marriage consummated."

So the executives still in New Orleans spend a lot of time in airports and on planes, flying back and forth to Houston.

Taylor said he spends one-third of his time in New Orleans, one-third in Houston and one-third in other places. And the time he spends in Houston is "never enough." He said he runs into 15 to 20 different industry executives at breakfast, lunch and dinner, many of them making deals.

Even though his company owns the world's largest offshore supply vessel fleet, Taylor said he's always looking for opportunities to build Tidewater and is always looking out for the competition.

However, it's hard to keep an eye out for competition when you're in New Orleans and your competition is in Houston, he said. "The competition isn't going to come from here," Taylor said as he sat in his office on Poydras Street.

Houston continues to grow just because other companies are there, Bennett said.

"It's feeding on itself," he said. "It's kind of like a good college football team that is consistently good. As long as you have a good honest program, recruits just walk in the door. The same thing happens in Houston; it attracts the best talent."

But Houston's business leaders aren't taking anything for granted, said Jeff Moseley, CEO and president of the Greater Houston Partnership, a business-based nonprofit that is trying to build regional economic prosperity.

"Every night there are people who go to bed wondering how to strip away what Houston has for their own city," Moseley said.

The group has singled out energy -- from oil and gas to alternative forms -- as an area in which it should fight for and retain jobs. The group scouts for leads for new businesses, then hands them off to one of 36 different groups that develop the leads and make specific incentive offers depending on the area of the city and the businesses.

The group is also raising $40 million to attract companies with high-paying jobs to diversify the economy for the next economic downturn. Moseley said his group is expecting one million new jobs will come to Houston in the next decade.

"It would be irresponsible to assume they will be high-paying jobs," Moseley said.

Taylor has been swamped with calls from state and local officials asking what they can do to persuade Tidewater to stay in New Orleans. It's the first time, he said, that he's heard from anyone in state or city government since the company returned after Katrina.

The sheer neglect of the oil and gas industry seems to be an overriding theme of many industry executives' complaints about New Orleans and Louisiana.

"There's a tendency to take your customers for granted," Taylor said. "The state has tended to take present customers for granted. One is as important as the other. You can't forget about the people who got you where you are."

Laborde said neglect of the local energy sector has been long-running and "unpardonable." From Gov. Edwin Edwards' first term on, Laborde asked the state's administration to pay more attention to the oil and gas industry.

"I don't think you need to give them anything. Just give them more attention," Laborde said of his standard plea to state officials.

Each time, state officials told Laborde his ideas were good, but they never got around to following up, he said. "Politicians are just oblivious," he said.

Coldren, who helped start up three energy companies based in New Orleans, Energy Partners, Coldren Oil and Gas and Bayou Bend, said he has not been contacted by anyone from the city offering help or even giving a simple welcome. "Probably that's the thing that's most disheartening," he said.

After news reports of Tidewater's possible departure, the New Orleans City Council passed a resolution asking the company to stay.

"What does the City Council think we're going to do? Change our minds because they passed a resolution?" Bennett said.

Before Katrina, New Orleans and the state put more economic development focus on the oil and gas industry. Mayor Ray Nagin had started meeting with executives, becoming the first mayor in memory to do so.

But with Katrina came different priorities.

A committee of GNO Inc. devoted to addressing needs of the oil and gas industry has yet to meet since the storm. Local and state economic officials are busy working with a broader set of issues, such as workforce development and corporate taxes, that will affect all businesses, said Drennen.

Donna Addkison, who will step down this week as the city's director of development, said she is perplexed by the complaints of neglect. She said her department has made 17,000 individual contacts to the 16,000 businesses in New Orleans.

"I find that very difficult to understand because so much of our focus has been on retention," she said. "It's designed to help businesses in the city to stay put."

The city is busy creating an economic future that is "sustainable," she said, adding that that future will always have oil and gas companies. "Geography dictates it," she said.

Olivier, the state's economic development secretary, said state officials have met with oil and gas companies and asked them to maintain or return their presence to Louisiana.

"Whether or not they have a corporate presence in our state, they still contribute to the economy," he said.

And Blanco's administration has made an effort to cut through the paperwork and bureaucracy that turned many oil companies away from the state, said Briggs.

Still, when asked about the departure of a Lafayette company called Superior Offshore, which recently went public and moved to Houston, Olivier said he had not heard of it.

State and local officials seem resigned to the fact the oil and gas companies in the city are destined to be smaller, service-oriented companies.

The "future is more in the smaller companies related to oil and gas," Drennen said.

Industry executives also acknowledge that New Orleans will play a much smaller role in the region's energy future. The future of the city's energy industry lies with oil and gas executives who love New Orleans too much to leave, they say.

Such executives stayed in New Orleans and started their own companies when the major oil companies left.

Rick Bachmann of EPL and Coldren of Bayou Bend fit into that category, as does Superior Energy Services in Harvey, a publicly traded company that employs 1,000 people worldwide in a variety of oil and gas sectors. About 750 workers are in Harvey.

Superior considered moving to Houston after Katrina, but the manner in which the company is organized dictates that executives be located where their work force is located, said Ken Blanchard, president and chief operating officer.

"We are a New Orleans-based company," Blanchard said. "Our executive management team spends a great deal of time in Houston. There's no reason they can't get on a plane and go there. We do not think you have to be full-time residents" of Houston.

Moving would have cost the company valuable employees, Blanchard said, and "the industry as a whole is having a great deal of trouble attracting professional people."

Coldren said he believes businesses can be built and succeed in New Orleans, with or without the government's help, as long as company executives are willing to fly to Houston and have technical and marketing people in that city.

"There's no reason that we can't have business here; several companies are proving that," he said. "There are a lot of people who are in New Orleans oil and gas who want to be in New Orleans."

The companies that move to Houston and leave behind their work forces give local energy companies an opportunity to hire good professionals who don't want to leave the area, Coldren said.

Art Johnson, president of local oil and gas firm Hydrate Energy International and the New Orleans Geological Society, once a stronghold of oil and gas professionals, said there are some geologists who have moved to Houston. But many others chose to stay in New Orleans because of family ties.

"I think you'd find that an awful lot of people call this place home," he said.

His club is making an effort to diversify its membership and is reaching out to geologists in other fields, including coastal restoration, to keep the club strong.

"We're continuing to evolve," Johnson said of the club. "We are trying to stay ahead of the changes to provide value."

Industry executives say New Orleans also must evolve to attract and retain businesses.

New Orleans needs to "look very closely at other cities. Look at the things that they are doing that we are not doing," Taylor said.

It's not too late for government officials to start to give energy companies and other business more attention, Laborde said.

"We're starting now much further back than they would have 20 or 30 years ago, but starting anytime would be good," he said.

Addkison said there are myriad programs aimed at encouraging new and existing businesses with incentives. The state is also working toward improving.

"As we continue to reduce taxes to make it more appealing for individuals of high income to remain in the state and we focus on those things such as education issues that are important to their family and quality of living, at some point in time the scales will tip back -- we will have a better product, and people will come back to Louisiana," Olivier said.

Parker said it's not just the government's responsibility to keep and attract businesses to the area; business and individuals have to help too.

He pointed to groups such as the Business Council, Citizens for 1 Greater New Orleans, the Horizon Initiative and Blueprint Louisiana, which are working to make the city and the state better by tackling not just the business climate, but things such as crime and schooling.


"Tidewater leaving is not the problem; it is a symptom of the problem," he said. "Will we shrug it off or learn a lesson and get involved?"

[soonerguru]

A lot of these same people want us to get rid of our marginal state income tax -- and be more like Texas by replacing it with higher property taxes.

Texas is having a funding crisis now because it relies so heavily on the property tax -- and hidden and sin taxes -- to keep its roads built and schools operational.

I don't think shifting to something as unpredictable as a property tax for our state revenues would be terribly popular.

[adaniel]

Here's an interesting read from the Times-Picayune. Although it's about New Orleans, it has applicability here.

What's Houston got that N.O. doesn't? Plenty - Breaking News Updates New Orleans - Times-Picayune - NOLA.com

----- August 2007 July 2007 June 2007 May 2007 April 2007 October 2006 What's Houston got that N.O. doesn't? Plenty
Posted by Pam Radtke Russell, Business writer August 04, 2007 10:27PM
Categories: Breaking News
As an accountant at KPMG in the 1970s and 1980s, Joe Bennett saw many of his clients, stalwart New Orleans oil companies, move to Houston.

"I sat there the whole time thinking, 'What the hell is so attractive about Houston?'¤" Bennett said.

But after relocating to the Texas city after Hurricane Katrina, Bennett, a senior vice president and chief of investor relations at Tidewater Inc., finally understands why the city he and other New Orleanians once considered a nuisance is such a draw for the energy industry.

"What I see is a much bigger town. There are public companies all over the place, a work force that is phenomenal, ... opportunities that are phenomenal," Bennett said. "The city is growing by leaps and bounds. When you drive around you say, 'My God, look at the businesses here.' "

Houston has 501 public companies and 915 public and private energy firms. The New Orleans region has just 11 public companies, and the local energy sector comprises 45 public and private firms, according to an analysis by the energy-focused investment firm Howard Weil. That mass of companies makes it difficult for an oil and gas company to do business anywhere but Houston.

"There's vibrancy and intellectual activity," said Dean Taylor, chairman, president and CEO of Tidewater, which operates the world's largest fleet of offshore supply vessels for oil and gas companies. "It's where ideas are being germinated and seminated. It's business-friendly. It's a city that works in every facet."

Taylor, Bennett and other senior management at Tidewater are weighing those positive attributes against the company's 51-year history in Louisiana. Earlier this summer, Taylor said some Tidewater executives, and the company headquarters, may move to Houston.

Tidewater would become the latest in a string of local energy firms to make such a move. Major and smaller energy companies alike, from Exxon Mobil to Newpark Resources, have relocated their entire operations to Houston over the past two decades. The number of people employed in oil and gas production statewide has gone from an all-time high of 94,722 in 1981 to 41,179 in 2005.

The departures only accelerated after Katrina, when many local energy companies temporarily set up shop in Houston and, like Bennett, saw firsthand the benefits of operating from that city. At the same time, Houston has become an aggressive economic recruiter, actively courting energy companies and tailoring incentive packages for them. Oil executives say the continuing exodus to Texas isn't a slight on New Orleans but more about the need to be in Houston.

"We make it about New Orleans, but it's not really about New Orleans. It's about Houston," said Jeff Parker, president of Howard Weil, which is based in New Orleans. "Houston is the Mecca of the oil business. It is strategically the most important city in the U.S., and probably around the world, as far as the energy business is concerned."

New Orleans, meanwhile, neglects its businesses, a situation that has worsened since the storm, executives say. That indifference, when combined with the city's high rate of crime, troubled schools and anemic health care system, makes it hard for some to stay.

"It's not just oil companies, it's all companies. They are all leaving New Orleans because of mergers and acquisitions," said Don Briggs, president of the Louisiana Oil and Gas Association. "They are leaving New Orleans because it's not safe. Quality of life is not like it used to be."

City and state leaders say they are reaching out and working to resolve the problems that plague New Orleans businesses.

"Gov. Blanco has done more for (the) oil and gas industry than any governor I've ever worked with," Briggs said.

The hard truth, though, said Mark Drennen, chief executive officer of the economic development group GNO Inc., is that the city has a long way to go. "In the short term, we're still not competitive," Drennen said.

I'm just now getting into the oil business and as a matter of fact I just wrapped up my internship with a major Houston oil company, and I can tell you in so many ways the New Orleans is nothing like OKC. Even before considering that whole little issue of hurricanes and being below sea level, NO's oil industry is in trouble largely because NO is in trouble. The only drilling in that part of the country is in the Gulf of Mexico, meaning that both NO and Houston are conveniently located. And with so much international oil projects you gotta be near a big airport that get you places, which pretty much screws NO. And the city's horrible social ills make it hard to bring in new employees. OKC is fortunate in the fact that most companies are based here due to gas drilling in the middle of the country. Thats why theres almost no majors (Chevron, BP, Exxon, etc) in OK but a TON of small independents. It makes sense to be here. If anything our biggest competition in terms of oil jobs is probably Denver because companies there too specialize in Midcontinent gas fields. I don't see how that article is applicable to NO, other than the fact that OKC is lucky its not in as bad of shape.

I hate to sound like I'm taking it personally but I wish some people would stop being so gloomy and dim on OKC's oil and gas industry. I have met a lot of good people who have worked to make it very strong and healthy so OKC doesn't end up like NO. Its so easy to look at the past and say "wow company x and company y were here and now they're in Houston and it really sucks," but when you look at the big picture I think the future is as bright as its ever been. Just my 0.02

[okclee]

BDP and Sonnerguru said it best.

It is time for Okla to stop being Cheap, get educated, and create a better place to live.