In its attempt to lure Amazon to open its second headquarters in New York, officials offered the company $800 million more in incentives than previously known to the public. Documents obtained by the Wall Street Journal reveal the breadth of the proposal from state and city leaders as part of Amazon’s year-long contest in 2017 to find a new home for 50,000 jobs. According to the WSJ, the original offer to Amazon included $1.4 billion of tax credits, $1.1 billion in grants, and part of the salaries paid for some employees.
In 2017, Amazon launched a nationwide competition to find its “HQ2,” which included a facility to hold at least 50,000 jobs. The city pitched four neighborhoods in its first bid to the company, including Midtown West, the Brooklyn Tech Triangle, Lower Manhattan, and Long Island City. According to newly obtained documents, Governors Island was even offered to the company as an “island retreat” for employees.
While the city released many details about their pitch in October 2017, they did not include the incentive package offered. But documents obtained by the WSJ through a Freedom of Information Law request to the Empire State Development show an extra $800 million in incentives for the company to move to New York. This included $500 million for a “Center for Commercial Innovation” near the headquarters and 25 percent of some graduates’ first-year salaries to help “achieve workforce diversity.”
After narrowing the list to 238 proposals, the online retailer in November 2018 selected two cities for its new home: Long Island City and Arlington, Virginia, with each said to house 25,000 new employees. The split headquarters caused the city and state to adjust their offer to Amazon, a spokesperson with the ESD told the WSJ. The final offer from New York to Amazon was around $3 billion, with $1.2 billion in tax credits and the potential for another $1.3 billion “as-of-right” benefits from the city.
“Throughout the negotiating process, we sharpened our incentive package and ultimately secured a better return on investment for the state and the biggest economic development opportunity in New York’s history,” ESD spokesman Matthew Gorton said.
Community activists and politicians who opposed the project protestedAmazon’s anti-union practices and the state’s large incentive offer, which was provided to a company considered to be the most valuable in the world. In response to the backlash, the company last February pulled out of its plan to move to Queens. Amazon officials cited the need for “collaborative relationships with state and local elected officials who will be supportive over the long-term.”
Despite the contention, Amazon continues to grow its footprint. Last month, the company announced plans to lease space in Hudson Yards, with 335,000 square feet of office space at 410 Tenth Avenue. The space will house about 1,500 employees, starting next year.
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