F.R. gaining Novelty at Rhody’s expense

For Fall River, it’s just what the economist ordered: a major corporation snapping up a vacant 500,000-square-foot warehouse and promising to bring at least 150 jobs to a city with double-digit unemployment.
But Rhode Island Novelty’s decision to locate distribution operations in the city comes at Rhode Island’s expense. The family-owned company is leaving facilities in Johnston and Warwick and has indicated that future growth will occur in the Bay State, not in Rhode Island, although the company will keep its headquarters in Cumberland.
Founded in 1986, the company bills itself as the nation’s leading importer and wholesale distributor of novelty toys and employs about 200 people.
Warwick Mayor Scott Avedisian called the pullout from his city “disappointing” and said company executives never told city officials they were considering a move. Melissa Chambers, a spokeswoman for the R.I. Economic Development Corporation, said officials there too had no knowledge of the company’s impending move.
Company executives did not return repeated messages seeking comment.
According to Fall River officials and media reports, Rhode Island Novelty plans to close this month on the former A.J. Wright distribution facility in the city’s corporate park. TJX closed the center and the retail stores it supported in December. The warehouse shutdown put 800 people out of work.
Fall River Office of Economic Development Executive Vice President Kenneth Fiola Jr. said Rhode Island Novelty executives told city officials they plan to relocate 150 jobs from Rhode Island to the warehouse. They expect operations in Fall River to start later this year or early next year after a retrofit of the facility.
There is also potential that the company will double its work force during the next few years, Fiola said.
“We’re confident that the 150 to 200 jobs right now will be a baseline and Rhode Island Novelty will grow from there,” he said. The company is also eyeing constructing a new wholesale showroom in the next five years, Mark Levin, a lawyer for the company, told The Herald News.
The company’s relocation to Fall River comes as the city struggles during the economic downturn. In July, it had the third-highest unemployment rate of any metropolitan area in the state, behind only the Lawrence and New Bedford regions.
So when Rhode Island Novelty executives mentioned the potential of more jobs to come, Robert Mellion was ecstatic.
“The timing couldn’t be better,” said Mellion, president and CEO of the Fall River Area Chamber of Commerce and Industry.
The purchase also takes off the market a hulking warehouse. City officials had fretted that the warehouse would remain vacant.
Rhode Island Novelty discussed the plan with city officials six months before deciding to purchase the A.J. Wright warehouse, Fiola said. Executives met with Mayor Will Flanagan and other city officials.
The company will not receive any tax breaks or other deals from the city. Fiola said the mayor offered assistance in securing permits, while economic officials promised to help the company secure work force training grants.
If the company sought any help in Rhode Island, it wasn’t through the EDC, agency board member George Nee said.
He’s not surprised executives approached officials in Fall River. Cities along the border are constantly poaching firms from each other. Last year video game company 38 Studios LLC moved from Maynard, Mass., to Providence and Yardney Technical Products Inc. said it would jump over the state line from Pawcatuck, Conn., to East Greenwich.
But Nee, who is president of Rhode Island AFL-CIO, said it was frustrating that Rhode Island Novelty never reached out to officials here before deciding to move.
“If they don’t reach out it’s very difficult to help them,” he said. &#8226