Posted on Wed, Nov. 29, 2006

Immigration backlash bad for business
By Mitchell Schnurman
Star-Telegram Staff Writer

Farmers Branch is about to test the advertising adage that there's no such thing as bad publicity.

Two weeks ago, the city north of Dallas made national news by adopting rules that take aim at illegal immigrants, an area of law usually left to the federal government. The City Council voted unanimously to bar landlords from renting apartments to illegals, to have city police cooperate with federal agencies in targeting "criminal aliens" and to conduct most official business in English.

No proposal yet to put a fence around the suburb, but who knows?

The city and mayor were flooded with letters and e-mails, and Mayor Bob Phelps says most supported the ordinances. But I'll bet there weren't many compliments from chief executive officers.

The city's exercise in local control may play to a large swath of the public, frustrated by Washington's inaction on immigration and the negative effect of illegal immigrants on some neighborhoods. But the move is a disaster if you're in the economic development business, which happens to be at the top of the Farmers Branch to-do list.

The city has two big projects in the early stages, and they're seeking tenants and investors for the key deals. One is an 800-acre development just west of Interstate 35E, and the other is a light rail station on the eastern side of the interstate.

Imagine trying to land a corporate relocation when Hispanics are threatening boycotts and lawsuits, and protesters from both sides are jamming City Hall.

It's not as if local leaders didn't consider the effect on business development -- they simply plowed ahead anyway.

In late September, a task force of businesspeople charged with revitalizing Farmers Branch sent a memo to the mayor and council, urging them to reconsider the immigration measures.

Members "report that they have received negative feedback from corporations looking to locate or to do business in Farmers Branch, because of the recent media attention," the memo says. "They are concerned that a very large corporate headquarters lease may have been delayed and may actually be withdrawn as a direct result of the discussions."

The city's image is being damaged and certain economic development initiatives by the task force could be threatened, the memo says.

It also notes that Farmers Branch is being "painted as divisive and unsafe, where property values and quality of schools are declining, and crime rates are increasing."

Why would outsiders get that impression? Because that was part of the stated rationale for cracking down on illegal immigrants in the first place -- an assessment that proved to be false.

The mayor says the corporate tenant ended up signing a lease but hasn't moved in yet, so he declined to identify the company. But he acknowledges that some corporations could think twice about moving to the city. "They don't want to be part of a problem," Phelps says. "They're trying to build up their company and their images."

In Farmers Branch, the mayor votes on proposals only if there's a tie, so Phelps didn't officially weigh in on the immigration policies. But he seems discouraged by the controversy. After nine years as a councilman and his 11th year as mayor, Phelps says he may not run again when his term expires in 2008. Two longtime councilmen will not seek re-election next year, and candidates who support the immigration push appear likely to run.

"I had wanted to stay one more term, but it depends on how things go," Phelps says.

That could be another blow to corporate recruitment, because companies like stability and predictability in local government.

Farmers Branch first tried a less confrontational tack, passing a resolution that urged President Bush to enforce the immigration laws more aggressively. It also called on other Texas cities to back the idea.

But the local crackdown took on a political life of its own, stirring supporters and opponents in the city, the Metroplex and beyond. Phelps says 90 percent of the e-mails he received on the subject were from outside the state.

He was interviewed by The New York Times, CNN, 60 Minutes and many more news outlets -- something that had never happened in his 20 years in city government. "We had a quiet, easygoing community," he says.

When Farmers Branch passed the rules, the Star-Telegram talked with other area leaders, and most said they'd have nothing to do with the issue.

"Our diversity is our strength," Fort Worth Mayor Mike Moncrief said.

Arlington Mayor Robert Cluck said there was no interest in following Farmers Branch's example, despite a proposal from a local activist.

Aledo wasn't even interested in joining the Farmers Branch resolution sent to Bush.

"I don't think we should open that can of worms," Mayor Pro Tem Greg Doherty said.

Smart assessments, even obvious ones.

So what was Farmers Branch thinking? Not about business.
Mitchell Schnurman's column appears Wednesday and Sunday. 817-390-7821 schnurman@star-telegram.com

http://www.dfw.com/mld/dfw/business/16121623.htm