Posted on 01/22/2018 7:35:37 AM PST by SeekAndFind
Amazon released its short list of contenders for its second-headquarters project on Thursday, and the news was bad. Whether it was worse for the hundreds of communities left out of the running or for the 20 so-called finalists is an open question.
Judging from the willingness of some remaining contenders to endow one of the world's richest companies with billions in handouts, we're going with the latter.
As we've been reporting since September, when the Seattle-based online retailer and tech giant announced plans to locate a $5-billion, 50,000-employee complex as its second headquarters somewhere in North America, offering tax abatements and other benefits to Amazon is exactly the wrong approach for civic leaders.
A project of this magnitude will impose untold burdens on the chosen host community and its residents that can be alleviated only with billions of dollars in civic investments. But that money won't be available to a community that hands it over to Amazon as a come-on.
Some communities have resisted offering incentives. Toronto, for instance, landed on the short list despite offering no handouts, according to Richard Florida, a respected urban development expert at the University of Toronto who serves on the board of Toronto Global, a civic agency devoted to economic development.
(Excerpt) Read more at beta.latimes.com ...
Quite the opposite, they are opening the floodgates to subsidies.
It would be preferable for Amazon to open several smaller facilities throughout the country.
I’m good with it. The federal government just gave huge tax cuts to bring companies back to this country. Why shouldn’t states and cities.
Um ... no. This is not distribution centers, this is corporate offices. Those they hire will be programmers and project managers and marketers. They will be creating new products and services. Spreading them out all over the place makes for a much less efficient company.
A lot of things “should happen” but never will, and this is one of them.
The article is correct that, big corporations, seeking a site for a big project (factory/headquarters), seldom rank the tax incentives very high in weighting the factors for a location. Here are some of the more important factors normally considered (weighted differently for different industries).
1. Labor Rates
2. Logistics (access & distance to customers and B2B partners)
3.) Available workers (skilled or otherwise)
4.) Business climate and tax structure
5.) Competition
6.) Public Relations (or Marketability)
The hypocrisy of Mr SJW who runs Aamazon is breathtaking. Isn’t this guy the richest guy in the world right now? Yet here he is playing cities against each other while being celebrated by all the lefties when he attacks Trump.
I have said this before. Amazon will put this in Cincinnati/Northern Kentucky or Nashville. They hit all of the marks, especially costs of living and labor.
Agree....id bet on Ohio...second Nashville TN.
Thanks SeekAndFind.
offering tax abatements and other benefits to Amazon is exactly the wrong approach for civic leaders
Abatements for the investment works out for the local gubmints because overall, property values, assessed valuations, and property tax receipts all increase on everything else. There are other drawbacks to rising property values though.
Hey MICHAEL HILTZIK - in 3rd world hellholes the offers would be made ‘under the table’. The United States is a free country and has free cities, states, whatever - they can offer whatever the hell they want to offer.
If they overdo it, they’ll be voted out of office. That’s how it works in free countries.
So says Los Angeles. . .which is not actually in the running, despite being on the list. . .
So, Apple wants to deposit some of it’s money back in a US bank and in so doing, it will be taxed at a lower rate than it would have, previously.
A homeowner is about to see their property taxes go thru the roof to pay for all the incentives that Amazon is going to get.
I’m thinking there’s a rather large difference in the two. The first, you don’t miss the money because you never had it to begin with. The second comes out of your pocket, every month, before you pay for food, gas, and your light bill.
This is no different than rich, team owners extorting/forcing cities and states to help build stadiums and arenas.
He alone is worth over $100 billion. He would have no problem withdrawing the $5billion out of his own account. No need to bleed people. On top of all that, think of all the liberal, hipsters that will be moving in. Unacceptable.
San Antonio TX bailed out on this boondoggle early on. Even our tax and spend city fathers backed away from the astronomical concessions being demanded.
Just up the road in Austin I understand they are still in the hunt and hoping for the best. Of course in liberal Austin, the amount of money the city will lose in the long run is of no concern to their city managers. After all, raising taxes will cover any shortfall. Besides, your money isn’t really your money. It belongs to the gubmint. They are just loaning it to you for a while.
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