Resources for Reporters and Researchers 

April 2018

TO: News Media Outlets in Amazon’s HQ2 Finalist Localities

RE: Ideas for Covering Amazon’s HQ2 and How It Would Impact Your City

Sources: Greg LeRoy, Good Jobs First goodjobs@goodjobsfirst.org
Stacy Mitchell, Institute for Local Self-Reliance smitchell@ilsr.org

We write to suggest angles and issues about Amazon’s HQ2 project that may merit additional reporting. This is a rare opportunity for civic journalism about complex issues that have attracted high public interest.

Are the incentives being offered actually going to be a factor in whether Amazon chooses to locate here? Or would they be a windfall? Because state and local taxes are such small cost factors, evidence shows that incentives rarely drive location decisions. And in the case of a corporate headquarters, the executive talent pool is especially important. It’s an opportunity to explore the kinds of corporate headquarters your metro area already has, and the graduate programs of your local universities in engineering, law, accounting, marketing and other professions.

Who owns the parcel(s) of land proposed for use in the bid? What is known about that developer, its track record and political connections? How well or poorly has it performed in past projects? Has it delivered, or not, on past incentive awards? How much money have the company and/or its executives given to the campaigns of elected officials? (See WAMU’s “Deals for Developers, Cash for Campaigns” series as an investigative template.)

How would Amazon’s HQ2 affect existing local businesses and change the character of the city? Rising commercial rents is a top challenge for locally owned businesses and local entrepreneurs trying to start businesses. How much will HQ2 affect commercial rents? Will it cause substantial rent increases that displace locally owned businesses, especially those that serve everyday neighborhood needs? How will Amazon’s large footprint alter the character of the city? To what degree will the city’s streetscape come to serve the needs of Amazon employees, perhaps to the detriment of other residents?

Will the project fuel gentrification and displacement? What is the current affordability of housing in the project footprint and surrounding neighborhoods? What would be the likely impact on them of tens of thousands of highly-paid executive jobs arriving? Does the bid specify ways to cushion that effect?

Would HQ2 help the city’s low income families or exacerbate inequality? Many of the jobs created by HQ2 will go to newcomers who have specific skills, not to current local residents. Given this, how will HQ2 impact low-income families? If it doesn’t create good jobs for these families, are they likely to be worse off overall, due to Amazon’s impact on their cost of living, particularly housing costs? Will this exacerbate inequality? How is the city proposing to address this?

How much in tax breaks would Amazon automatically quality for? Discretionary, or deal-specific incentive offers, are getting a lot of attention. But in most states, the pre-existing “as of right” tax breaks that flow automatically, or virtually automatically, to any company that performs an eligible activity, may constitute the bigger dollar value. These include investment tax credits and hiring tax credits (which typically reduce or eliminate corporate income tax liabilities) and sales tax exemptions on new building materials and equipment.

Does the bid provide taxpayer safeguards? Are there money-back “clawback” provisions? Job creation, job retention and wage and benefit requirements? Would any incentives require special legislative enactment? Which public services would be affected by the foregone revenue? If the offer involves the area’s infrastructure budget, what share would it take?

Are there community benefits? That is, are there specific, binding obligations that the company would engage with incumbent city residents to ensure HQ2 would benefit them as well? (These could include local hiring, affordable housing support, local sourcing, university partnerships, etc.)

 
 
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Public Auction, Private Dealings: Will Amazon’s HQ2 Veer to Secrecy Create A Missed Opportunity for Inclusive, Accountable Development?

Washington, DC-As Amazon.com conducts site visits at the 20 finalist locations for its second headquarters, or HQ2 project, little is known about most of those localities' first-round bids, and almost nothing at all is known about six. Even though billions of dollars are at stake, few states and cities have fully disclosed their bids. Even those that have partially disclosed have not revealed the details of their tax-break offers and their costs to taxpayers.

That is the main finding of a study released today by Good Jobs First. "PublicAuction, Private Dealings: Will Amazon's HQ2 Veer to Secrecy Create A Missed Opportunity for Inclusive, Accountable Development?" can be found at  www.goodjobsfirst.org.