(LEILA ATASSI, PLAIN DEALER REPORTER)
Mayfield - The colossal structures with their glass facades interrupt the village's tranquil landscape like UFOs that crash-landed in suburbia.

Since Progressive Insurance Co.'s first campus descended on Mayfield in 1974, the company has grown exponentially and developed a symbiotic relationship with a community eager to keep its corporate visitors around.

The car insurance company pays the village about $6 million in income tax annually. That's more than half of the $11.3 million budget for a village whose population for decades has remained below 3,500.

The company is gearing up for its third Mayfield campus, and though details are still uncertain, local officials eagerly anticipate what might be a $40 million expansion of the village's greatest taxpayer.

Mayfield has become a modern company town, in danger of falling victim to the same fate as other municipalities whose local economies were buoyed by a corporate monolith until it folded or moved elsewhere.

So in these early stages of Progressive's expansion, village officials have rallied residents behind the project, helped acquire land for the company - and warded off an awareness that is both terrifying and necessary. It's the feeling, as village Finance Director Philip Brett put it, that harboring Progressive's multibillion-dollar ship is like a voyage on the Titanic.

It's nice while it lasts.

"The question was raised in the '70s, it was raised in the '90s, and it will be raised again," Brett said. "What if Progressive leaves? And the answer is always the same."

Mayfield sinks.

Village residents remember a less Progressive time, when "No Hunting" signs decorated SOM Center Road and the now-developed commercial land was wooded.
In the early 1970s, the village's annual budget was about $225,000 - a fraction of what the village now collects from Progressive.

Today, Progressive's buildings are like oceanliners docked along Interstate 271. Sidewalks, dotted with employees power-walking on their lunch breaks, wind through the company's two campuses. The 6,400 employees enjoy their own
dry-cleaning service, gift shops, food courts, health services and one of the largest corporate art collections in the country.

For 30 years, Progressive has been a good corporate citizen, said Mayor Bruce Rinker. The company is environmentally clean and easy to work with, he said. Village residents have access to Progressive's fitness center at the same
price as employees, and in exchange, Progressive employees swim in the village's public pool, which the company helped pay for. Green space, wetlands and sports fields are used by residents as well as the employees, who outnumber
them two to one.

But the company's greatest benefit to villagers is that the taxes it pays keeps residential property taxes low and the income tax credit high. Residents receive full credit, up to 1.5 percent, for income tax paid to other cities.
Progressive's new campus is expected to have offices for about 3,600 employees, though most will not be new to the company. An undetermined number will be from Progressive offices outside Mayfield.

"By creating an environment where one can work and play and live in an enjoyable setting, we're trying to encourage Progressive to stay rooted here," Rinker said. "And building a new campus reflects to me that they're making a
commitment to staying in our community."

In 1992, Progressive planned to leave the village and establish headquarters in downtown Cleveland. Instead, Progressive accepted a 66 percent real estate tax abatement for 15 years to stay and expand in the village. The company
pays about $2.3 million in annual real estate taxes.

More than a decade later, Rinker says the village knows not to take the company for granted. And history shows the fortunes of company towns can turn on a dime.
The closing last year of the Rubbermaid factory in Wooster left hundreds unemployed and forced cuts at the local school district. Vermilion schools will lose hundreds of thousands of dollars when the Ford Motor Co. closes its Lorain
Assembly Plant by year's end.

But unlike the industries of the old company towns, the insurance industry is not as vulnerable to the ebb and flow of the economy, said Dr. Ziona Austrian, director of the center for economic development at Cleveland State University.
"Because the old one-industry towns were usually based on some form of manufacturing, like the automotive industry, their economies were more cyclical," Austrian said. "They declined with the recession." Car insurance is directly linked to the automotive industry, but consumers still buy insurance even if they delay buying a new vehicle, Austrian said.

Basically, people will always need to drive, and as long as they drive badly, Progressive will continue to grow. It's just a matter of whether or not the company will do it in Mayfield.

"We're tied inexorably to Progressive's fortune," Brett, the village finance director, said. "And they can go pretty much anywhere they want. They've reminded us time and again that all they need is a phone line."

The company isn't considering leaving Mayfield, said Progressive chief administrative officer Kim Price.

"Symbiotic is exactly the word," she said, noting the relationship has been mutually beneficial. "The community enjoys low taxes, and we have a cooperative local government that supports Progressive's expansions. We have no reason to leave."

But Progressive's second campus was designed in three smaller buildings - an indication, Mayor Rinker said, that its planners considered the practicalities of subletting should Progressive leave.

The best way for any municipality to safeguard against losing its primary industry is to diversify its economy, Austrian said.

The village is developing a technology-based office park on its Beta Drive business corridor. In April, the village approved a $50,000 development agreement with locally based Panzica Investments to jump-start the project.

The strip would serve as training wheels for up-and-coming high-tech businesses, which would receive a discount on rent and share the cost of professional services such as clerical workers, human resources and legal counsel. Panzica hopes to recruit about 24 tenants.

Although Beta Drive is a step toward diversification, Brett said, its economic benefits and businesses' long-term commitments are uncertain. The tech park would be a long shot in buffering the city in the event of Progressive's exodus.

"We would've been up against it, in the past and now," Brett said. "We're constantly trying to develop what we call non-Progressive revenues for our village - and it's like trying to drain the ocean with a bucket."

To reach this Plain Dealer reporter:
latassi@plaind.com, 216-999-4549

Copyright 2005 Plain Dealer Publishing Co.
Plain Dealer (Cleveland)
June 6, 2005 Monday
FINAL Edition; ALL Editions