Prediction: "Textbook"
Tax-Break Auction
Greg LeRoy, Good Jobs First
EDITOR'S NOTE: The state of Rhode Island has already announced it intends to "bid" for Amazon to come to Rhode Island.
Taxpayers should watch their wallets as the trophy deal of
the decade attracts politicians to a hyper-sophisticated tax-break auction.
We fear that many states and localities will offer to
grossly overspend to attract Amazon, even though the business
basics--especially a metro area's executive talent pool--will surely control
the company's decision.
Public auctions for economic development deals, like those
staged in the past by Boeing and Tesla, are the rare exception: nearly all are
staged in secret.
Based on what we know about Amazon, we expect this one to
be a textbook show.
And as we documented
in July, it has recently advertised for additional senior staff in that
department.
Since our December 2016 study, Amazon has continued to
receive subsidies valued as at least $115 million (not including four deals of
undisclosed value), for a long-term total
exceeding $1 billion.
While we assumed Amazon would apply this expertise for more
fulfillment and sortation centers, it now appears the company will also deploy
it for a new headquarters deal. In its press release, we already see the
markings of an aggressive messaging strategy to justify massive subsidies.
For context on other corporate headquarters tax-break
packages, see this list of the largest such deals from our Subsidy Tracker
database:
Good Jobs First also recommends the research of the
Institute for Local Self-Reliance on Amazon, especially its
November 2016 study.
Good Jobs First is
a non-profit, non-partisan resource center promoting accountability in economic
development. Founded in 1998, it is based in Washington, DC.
