Finalist Cities Facing Unintended Consequences from Amazon HQ2 Bids
There’s absolutely no doubt that whichever city Amazon ends up choosing for its second headquarters will benefit from the presence of Jeff Bezos’ company. Amazon has promised some $5 billion in investments in the local community over the next two decades along with creating an estimated 50,000 jobs in that community—similar to the company’s footprint in the Seattle region.
But as the hunt for an HQ2 narrows in on the top 20 cities, the ugly underbelly of this manufactured competition is starting to turn up.
As reported by the Wall Street Journal over the weekend, the 20 finalists on Amazon’s shortlist are quickly discovering some of the unintended consequences of their bids to lure Amazon. Namely, companies with already-established presences in those finalist cities are starting to call for similar tax breaks and other incentives that elected officials in those cities have promised to Amazon.
In Washington, DC, for example, a group of tech companies wrote the city’s mayor recently detailing a list of their own demands from the city—which included training bonuses and property tax breaks, among other things—which the city is reportedly offering to Amazon.
And it’s not just tech startups who are making noise. James Dimon, CEO of JPMorgan Chase & Co., said that he plans to call up the governor from the winning city and demand a similar deal. His company has tens of thousands of employees in a several of the finalist cities, including Dallas, Chicago, and Columbus.
Credit: Wall Street Journal
A WSJ analysis of the tax benefits that would be handed out to Amazon (above) showed that the benefits packages offered in the Newark, New Jersey, and Montgomery County, Maryland bids would rank second and fourth, respectively, on a list of the largest tax incentives packages for corporate investments. Both are larger than the highly controversial Foxconn incentives package that was offered by Wisconsin and that drew the ire of local residents and businesses.
More than 200 cities and metropolitan areas applied for the opportunity to host Amazon’s second headquarters when the “competition” was opened back in September. Amazon narrowed that list down to 20 finalists in January and has said that it will identify a winner sometime this year. The company has been reportedly begun making rounds to the finalist cities.