Even Leigh Nixon—the bubbly, energetic head of the Simi Valley Chamber of Commerce— had trouble finding something positive to say last month when asked about the effect the loss of Farmers Insurance will have on the city’s small business base.

“It’s a huge, huge hit here. You can’t lie about that,” she said. “Everybody’s going to feel it.

“Their employees spend a ton of money here, and now they’re picking up and leaving, and leaving a lot of people in the lurch. There are a lot of people who aren’t going to be able to replace the business once they’re gone,” Nixon said.

After 28 years in the city, Farmers announced three weeks ago it will be moving all 1,200 of its Simi Valley employees from 3041 Cochran St. to a newer, more modern office in Woodland Hills starting early next year.

Though city officials have pledged to do all they can to help find a new tenant for the aging 271,000-square-foot, five-story building, business owners who relied heavily on dollars spent by Farmers employees are already lamenting the future loss.

“We’re going to be losing a couple thousand dollars a month without their business,” said Vick Bhunber, manager of the Jersey Mike’s Subs in the Sycamore Square Shopping Center just down the street from Farmers.

“About $1,500 in revenue a month comes from catering we do for Farmers, let alone all the strays that come in for lunch.”

Jersey Mike’s Subs is just one of at least 20 eateries in the immediate vicinity of the building who for years have relied on the Farmers lunch hour rush as a major source of revenue.

Brad Hamlet, a general partner in Working Gear, a work-supply store also in the Sycamore Square Shopping Center, said he fears the worst for his food-serving neighbors.

“I don’t think we’re a main destination for them, but it’s going to kill Simi,” he said. “The restaurants are definitely going to hurt because you can just see at noon that (Farmers employees) will just spread out at all the local restaurants.”

Aside from restaurants, no sector of the local economy is more anxious to hear about a new tenant for the Farmers building than the hotels.

Unlike lodging in destination cities like Santa Monica or Hollywood, Simi Valley’s six hotels depend mostly on business travelers, not tourists, for revenue, said Shelly Baltimore, regional director for Pacifica Host Hotels, which owns and operates Courtyard by Marriot and Holiday Inn Express in Simi Valley.

“I think people are surprised to find how much of our business is comprised of corporate customers,” said Baltimore, who’s worked in the hotel business in Simi for 17 years. “Our busiest days are Mondays, Tuesdays and Wednesdays, not the weekend.”

She said Farmers was probably responsible for “2,000 room nights a year” between the two hotels she represents.

“We’re definitely going to miss the business,” she said, adding, “I just hope they can fill that building quickly.”

Council’s efforts

At Monday’s City Council meeting, Lonnie Sproat, vice president of commercial operations for Farmers, spoke to the council about the company’s decision to relocate.

The move won’t start until the end of February 2011, Sproat said. Half of the employees will relocate by April or May, while the rest won’t be out of the building until the end of next year.

“We still have a long runway ahead of us,” he said.

Sproat assured the council that the move is “solely a business decision” and that Farmers has been happy with the city’s support over the years.

While the company recognizes the significance of its decision, he said, there would be no jobs lost because of it.

But Mayor Pro Tem Glen Becerra disagreed.

“We understand (the move) for financial reasons, for business reasons . . . but for us to say we’re not disappointed would not be true because when you take 1,200 people out of a central location like this that shop locally, that eat lunches, that eat dinners, that have breakfasts, that’s going to have an impact,” the council member said.

“And to say there’s not going to be any job losses, maybe not directly to Farmers, but we don’t know what the impact will be yet on small businesses that depend on those people to come and have lunch and use the dry cleaning facilities and all of that.”

Becerra added that Farmers’ help is “critical” to make sure the city can fill the empty office space with a good tenant.

“The power of Farmers, being one of the largest insurance companies in the country, in the world, you need to turn that power on for the city here that’s been good to you for a long, long time,” Becerra said. “Because we deserve that, the people of this city deserve that . . . and I’m hoping that’s what you’re pledging.”

Sproat said Farmers accepts that responsibility and is committed to helping the city find the best tenant or tenants possible.

To that end, Councilmember Steve Sojka said that he walked the area around Farmers recently—including the shopping centers of Mervyns, Target, Sycamore Plaza and the Do-it Center—and spoke with business owners.

From his conversations, he identified four ways—as recommended by the business owners— the city could help minimize the impact of the loss of Farmers on local shops (see info box at right).

“If we can work with the business owners to see if we can accommodate that, because they’re going to be fighting for their lives, to be quite honest with you,” said Sojka, a small business man himself. “This is going to be a huge impact to the majority of businesses.”

The council agreed to bring back the items for discussion at a later date.

Nixon, meanwhile, pointed out that, with Farmers leaving, there was “no better time than now to shop local,” especially at those businesses in the immediate vicinity of the building.

“This is the time all those businesses need your support,” she urged the community. “Go eat in the restaurants, go shop in the retailers over there, use the mailing house. . . . Let’s support everyone, but especially those places that are going to be hit hard.”

Sojka’s proposals

1. Relax the city’s sign ordinance regarding restrictions on banners and temporary signs.

2. Temporarily suspend the business tax receipt license within a half-mile area of Farmers until a new tenant is found.

3. Expedite the process to designate the area as a redevelopment zone, which would allow local businesses to take advantage of the city’s facade renovation program and the newly approved low-interest business loan program.

4. Allow businesses to do sidewalk sales and special promotions.