THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Saturday, October 26, 1996 TAG: 9610260007
SECTION: FRONT PAGE: A14 EDITION: FINAL
TYPE: Editorial
LENGTH: 61 lines
The bad news thundered through corporate Hampton Roads this week: Norfolk Southern Corp., the region's sole Fortune 500 company, might move its headquarters to Philadelphia.
Norfolk Southern Chairman David R. Goode offered to consider the move as part of a $9.15 million bid to buy Conrail, which has its headquarters there. He had to do something. Rival CSX, with headquarters in Richmond, had offered about $8 billion for Conrail, and whichever company claims Conrail will be in the catbird seat in the East. By acquiring Conrail, Norfolk Southern would effectively double its number of employees, miles of track and revenue.
If CSX triumphs in the bidding war, its headquarters probably will move to Philadelphia, meaning Richmond loses a Fortune 500 company. But that region has seven and can spare one with less pain than Hampton Roads. We'd be left with the embarrassing total of zero. We might become the largest economic region in the nation with no Fortune 500 to call its own.
If Norfolk Southern were to win the fight for Conrail and move its headquarters, the blow to Hampton Roads' image and ego would be greater than the immediate blow to its economy - 300 direct and perhaps 600 supporting jobs lost.
A major economic region - as Hampton Roads ought to be - should have Fortune 500 corporations, important cultural amenities and major-league sports teams however. And, in fact, the three are interconnected. The presence of major corporations in a region produces powerful ripple effects.
Take the case of major-league teams. Losing Norfolk Southern would make it all the harder to attract one. When George Shinn, owner of the NBA's Charlotte Hornets, recently discussed whether he favored putting a National Hockey League team in Raleigh or Hampton Roads, he said, ``Both markets are superb. In terms of raw numbers, population, there are more in Virginia. But when you talk about demographics, income, corporate support - its much better in Raleigh.''
And Hampton Roads might now lose a key source of corporate support, for Norfolk Southern has unquestionably been a model corporate citizen. Chairman Goode has provided a much-needed push toward regionalism.
As staff writer Mylene Mangalindan reported Thursday, Norfolk Southern employees have taken leading sponsor roles in Virginia Opera, the Chrysler Museum, Nauticus, WHRO, the Virginia Symphony and others. The presence of the rail Goliath has helped attract other companies and their employees.
In short, Norfolk Southern has been very good to Hampton Roads. For that reason, one cannot in good conscience root against the company in its fight for Conrail.
Still, anything that can be done to retain Norfolk Southern headquarters should be done. Hampton Roads would benefit greatly if Norfolk Southern won the battle for Conrail and kept its headquarters here.
Meanwhile, Hampton Roads leaders, public and private, have received yet another wake up call. This region is more than ever at risk of being left at the station, as other regions, fat with home-grown Fortune 500 companies, barrel on down the tracks.
There is no self-correcting mechanism in the Hampton Roads economy that will automatically make up for the loss of a Norfolk Southern. This development further highlights the need for the region to relentlessly work to attract employers - large, small and in between - and to cooperate in providing the amenities and infrastructure they seek. by CNB