- Mike Segar/Reuters
- Amazon revealed the top contenders that could land its second headquarters in early 2018.
- Nine of these cities are offering major economic incentives as part of their bids. Three have said they will not give Amazon any tax breaks.
- Out of all of these metros, Montgomery, Maryland is proposing the largest incentive package valued at $8.5 billion.
In January, Amazon named 20 North American cities as the top contenders for the future home of the company’s second headquarters, dubbed HQ2. The company says HQ2 will bring 50,000 jobs, and late last year launched an open call for city proposals that explain why the e-commerce giant should invest $5 billion in building a campus there.
In addition to offering huge swaths of land, financial incentives have become key parts of bids from many of these metros. A few incentive packages offer tax breaks that total in the billions.
Amazon likely won’t pick a city unless it is offering some kind of economic deal, since that was one requirement the company laid out in its request. When Amazon has opened facilities or office spaces in other cities across the US, it has often accepted local subsidies.
From 2005 to 2014, the company received at least $613 million in local government subsidies to build warehouses, according to a 2016 report by the Institute for Local Self-Reliance. The group, which pushes for local resources to be dedicated to community development, also found that Amazon received an additional $147 million in subsidies for its data centers.
Here are the nine places that have made their HQ2 incentive packages public, in ascending order of monetary value.
9. Raleigh, North Carolina — over $50 million
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For HQ2, North Carolina is amping up its main economic incentives program for businesses, known as the Job Development Investment Grant.
Amazon could be reimbursed for up to 100% of the withholding taxes from the new jobs it creates for up to 25 years, The News & Observer reports.
The company would also receive up to $50 million for HQ2’s infrastructure like water, sewer and rail access, with the money coming from a reserve account of $80 million in the state’s general fund.
In addition, another program called the One North Carolina Fund could award up to $5,000 per year, per job, for up to five years.
8. Denver, Colorado — $100 million or more
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According to The Denver Post, Colorado’s proposal named some possible incentives, including the job growth tax credit; job training grants of up to $1,200 per employee; enterprise zone program offering income-tax credits for companies locating in distressed areas; in-state tuition benefits for employees; and local city incentives that every community “under consideration has developed a custom incentive package … to support the build-out of Amazon HQ2.”
In an interview with The Post, Sam Bailey, Metro Denver EDC’s vice president of economic development, said incentives could be “in excess of $100 million.”
7. Los Angeles, California — $300 million to $1 billion
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California’s governor’s office will offer $300 million to Amazon in tax breaks if it picks a city in the state, Reuters reports. The company listed Los Angeles in the top 20.
But a bill introduced last year in California’s state assembly could give the company even more – up to $1 billion in tax breaks over 10 years.
6. Atlanta, Georgia — $1 billion
- Lauren Holley/Flickr
In Georgia, economic incentives are expected to top $1 billion, according to the Atlanta Business Chronicle.
“I have complete confidence in the Governor’s ability to lead this effort,” Atlanta Mayor Kasim Reed told Bisnow. “We have worked in a cooperative fashion, and I think when everyone learns about Georgia’s proposal, you’ll see that we left nothing on the table.”
5. Chicago, Illinois — At least $1.7 billion
- ICON, SOM, and 3XN
As The Chicago Reader notes, Chicago is offering Amazon $1.32 billion of the personal income taxes paid by the company’s workers annually.
These taxes normally go toward investment in civic infrastructure, including roads, schools, and healthcare. But if Amazon built HQ2 in Chicago, the state would grant the money to the company instead. It’s unclear how Amazon would spend the funds if it picked Chicago. In the past, the company has used Illinois tax credits to expand fulfillment centers and hire thousands of workers in the state.
This might not be the only economic incentive included in the proposal. In late October, sources familiar with Chicago’s bid told WTTW’s Chicago Tonight that the city would also grant $400 million in infrastructure and capital spending around HQ2.
4. Philadelphia, Pennsylvania — $2 billion to $3 billion
- Ron Reiring/Flickr
The state of Pennsylvania is reportedly offering Amazon “more than $1 billion” in tax breaks for its campus, according to The Philadelphia Inquirer.
Philadelphia submitted a separate bid, and is reportedly considering a tax exemption worth up to $2 billion over 10 years.
3. Columbus, Ohio — nearly $2.3 billion
Columbus city leaders assembled an incentives package in which Amazon would receive a 15-year, 100% property-tax abatement at every site included in HQ2, according to local outlet WOSU Radio. That adds up to a savings of $456,750 per $1 million of investment in property for the life of the abatement.
In addition, Amazon would get a refund of 35% on income-tax withholdings from new full-time employees at its new headquarters. That’s as much as $50 million annually, or up to $400 million over 15 years.
WOSU calculated that these refunds and abatements would produce almost $2.3 billion in savings for Amazon over 15 years.
2. Newark, New Jersey — $7 billion
New Jersey Gov. Chris Christie and state legislative leaders said they would offer Amazon tax breaks worth $7 billion over the next decade if the company decides to build in Newark, according to Bloomberg.
The plan would expand a subsidy program called Grow NJ, and provide economic incentives for companies (like Amazon) that launch “transformative projects” (like HQ2).
The state also proposed a bill that would raise the cap on tax subsidies from $5,000 to $10,000 for every job Amazon creates.
1. Montgomery County, Maryland — $8.5 billion in tax and infrastructure incentives
- Wikipedia Commons
On April 4, Maryland Gov. Larry Hogan approved $6.5 billion in tax incentives for Amazon, with an additional $2 billion in promised infrastructure and transportation improvements for Montgomery County, according to The Baltimore Sun.
Maryland’s offer is the nation’s largest publicly known incentives package for HQ2.
Baltimore City, as well as Charles, Howard, Prince George’s, and Montgomery counties, submitted separate proposals that could include additional tax breaks for the company. But only Montgomery County made the top 20.