State Farm Employees Say Closure Spurred One of the Hardest Decisions They've Ever Had to Make

Insurance giant State Farm is closing its 320,000-foot-building in Rohnert Park in 10 days, with all 450 employees facing major change.

State Farm of its 33-acre Rohnert Park hub eight months ago, adding to concerns in a city that’s lost nearly 3,000 people in 10 years and confronts a .

The changes due to the State Farm closure are manifold: a short sale on a house, impending unemployment, pulling kids out of area schools, leaving a family-oriented suburb of 40,000 for an inland agricultural mecca of 800,000 people.

State farm execs said 42 percent of its workforce has taken a deal to move to the Bakersfield offices, and about 100 employees are retiring. 

“The decision was made based on being cost-effective,” said Shirley Gordon, vice president of operations in Rohnert Park. “This building is severely underutilized.”

State Farm officials said last November that changes in technology, coupled with falling property values spurred the decision to shut down.

“Bakersfield is about 40 percent full and Rohnert Park is only 35,” Gordon said. “They’re both more than half empty … the Bakersfield building is twice as large and the cost to run a businesses there is significantly less expensive than in Sonoma County.”

“We know it’s hard — the transition,” said Lonny Haskins, a spokesperson for the company. “We’re helping as much as we can with relocation, selling homes and … we’re doing as much as we can for people who will not stay with the company. We’ve been such a close partner with the community here.”

Greg Jones, a State Farm employee for the last 25 years, is not moving to Bakersfield. (Check out this cool article from the Press Democrat on what he has planned here.)

“The hardest part is losing my extended family,” said Jones on a recent day at State Farm’s Founder’s Day, a yearly party for employees. “But my wife has a great job at Kaiser and my kids grew up here; Sonoma County is my home.” 

“It was one of the most difficult choices I’ve ever had to make,” he added.

At this year’s Founder’s Day, employees gathered in small bunches, sipping soda or eating cake or some sort of pasta salad. Conversations about what they’d do after State Farm closes peppered the air. In early June, cubicles were being emptied, boxes packed. The mood in the building that day was slightly sullen, slightly optimistic.

“I remember when they made the announcement that we're closing,” said Sharon Mackenzie, an insurance underwriter who’s been with State Farm since 1964, when it was located in Santa Rosa. “I don’t think it surprised anyone, it’s been in the back of our minds for years.”

Mackenzie said she’s noticed firsthand they way technology has changed the way the company does business. It’s small things, like needing less paper, and bigger things like computers replacing people. 

“There’s less of a need for people,” she said. “Some employees are bitter, but mostly, I think we’re grieving.”

Amelia Chapman, 38, took the move. 

Reluctant to uproot her two kids and husband from their Rohnert Park home, Chapman said the decision was mostly financial.

“I was born and raised in Santa Rosa, so this decision was really hard for myself and my family,” said Chapman, who is undergoing a short sale on her house. “But now I have my family to raise — the economy is tough, and we had to make a tough decision.”

“Mostly, I feel lucky to have a job,” she said.

Searching for a Tenant

Gordon said State Farm is "actively" , but so far, no takers. 

"We've had significant interest, but so far, no one's made an offer," she said.

Gordon declined to talk about who the interested companies or organizations are, but she did say they fit under the umbrella of "development."

Finding a buyer could be difficult in today's economic climate, she acknowledged. 

The total assessed value for the property is $22,418,153 — but it could be wildly different than that according to the Sonoma County Assessor's office, because under Proposition 13, the property can only be reassessed at the time of sale. The last time that property was assessed was 1977, when real estate mogul Hugh Codding purchased it.

It's likely that the property value has increased over the last 30-plus years, but given the depressed real estate market and Rohnert Park's vacancy rate, Gordon said she's not expecting to get full market value.

"We're actively looking to sell the building, but we're not immune to the marketplace," she said. "I don't know very many companies who would get full market value right now."

Editor's note: stay tuned for updates on the State Farm property, and ow the closure will impact the local economy in the coming weeks. Check out this series from the Press Democrat too, on how the closure is impacting employees.