Last week's disclosure by Judd & Detweiler Inc. of plans to close its printing plant in Northeast D.C. underscores an apparent inability of the District to keep the core of its manufacturing base.
The announcement, which caught D.C. officials by surprise, is a major loss in the District's rapidly declining printing industry as well as a serious setback for the city's business retention program.
Judd & Detweiler's decision not only raises serious questions about the viability of the city's business retention program, but suggests the presence of a wide communications gap between business and government in the District.
News that Judd & Detweiler plans to close the D.C. plant and eliminate nearly 200 jobs caught District officials as unprepared as they were when other large firms made similar disclosures of their intentions.
According to a published report, the director of the D.C. Office of Business and Economic Development (OBED) admitted: "This kind of threw me . . . We had no indications Judd & Detweiler were leaving."
That has a familiar ring that sounds a great deal like District government officials' reaction three years ago, when Perpetual American Bank turned in its D.C. charter and moved its headquarters and operations center to Alexandria.
City officials were no less surprised last year when they read in The Washington Post that The Hecht Co. planned to move its corporate headquarters from downtown Washington to Arlington.
Kwasi Holman, OBED's director, says his staff has been meeting with officials from printing firms in the District "to ascertain their problems." But OBED may need to adopt a radically different strategy if it is to halt the industry's flight to the suburbs. Market forces and competitive pressures all but dictate a new strategy. Holman refuses to concede that the District is no longer a viable location for the printing industry, pointing out that at least three or four out-of-town firms have expressed interest in locating in the city. Costs, he emphasized, are not the only determining factors in decisions to relocate.
The District is counting heavily on a plan to develop a 27-acre site in Northeast Washington as an industrial park in which printing firms and other manufacturing companies would locate, according to Holman. What's more, he said, the District is prepared to help printing firms with land assembly and financing packages, including industrial revenue bonds.
Whether that will be enough to offset efforts by Maryland and Virginia to lure more printing companies from the District remains to be seen. Printing company executives in the District by now are thoroughly familiar with the contents of a publication titled "Opportunities for Printing and Publishing in Southern Maryland."
Within the past year or so, economic development officials in Prince George's County have assisted at least 10 printing companies -- some of them with headquarters in the District -- with expansion and relocation plans. This week, in fact, Corporate Press Inc., a District firm, will break ground for a new headquarters and printing plant in Prince George's County.
All of this indicates that a comprehensive study of business retention in the District four years ago was more prophetic than D.C. economic development officials might have believed. The study, which was done for OBED by Brimmer & Co., a Washington financial and economic consulting firm, unerringly laid out the pattern that the printing industry would follow.
Although Brimmer suggested in 1981 that the outlook "continues to be positive" for the printing and publishing industry in the District, the study warned of "persistent efforts to bid away the larger printing and publishing firms doing business in the city. The more distant areas on the metropolitan fringe may attract new firms. The District must counter these tendencies."
The report further advised that, while the publishing sector remains more closely tied to the core area of the region, "The printing sector may move out." Industrial developers in nearby areas are alert to possibilities of capturing D.C. printing firms, the study warned.
Brimmer pointed out that increasing land and building costs in the District "favor a location outside" the city. Thus, Brimmer advised OBED to be "alert to factors which can generate cost differences between the District and outside."
More than four years after receiving the Brimmer report, the District is scrambling to salvage part of its vanishing manufacturing base. More than four years ago, Brimmer informed D.C. officials that printing industry executives had suggested that the city consider developing, in partnership with the industry, a printing and publishing complex that would provide firms with more efficient space at reasonable costs.
The suburbs responded more quickly.