Sarah Holder is a staff writer at CityLab covering local policy, affordable housing, labor, and technology.
The list skews toward larger cities and metropolitan areas along the Eastern corridor, stretching as far north as Toronto and as far south as Miami. And it looks like some of the economic incentives might be paying off.
We’re one step closer to finding out where Amazon’s coveted HQ2 will call home. The company has whittled down the list of 238 cities to 20, it announced Thursday morning. The list of finalists skews toward larger cities and metropolitan areas along the Eastern corridor, stretching as far north as Toronto and as far south as Miami. Below, the finalists:
- Atlanta, GA
- Austin, TX
- Boston, MA
- Chicago, IL
- Columbus, OH
- Dallas, TX
- Denver, CO
- Indianapolis, IN
- Los Angeles, CA
- Miami, FL
- Montgomery County, MD
- Nashville, TN
- Newark, NJ
- New York City, NY
- Northern Virginia, VA
- Philadelphia, PA
- Pittsburgh, PA
- Raleigh, NC
- Toronto, ON
- Washington, D.C.
Amazon first announced the continental search for a new headquarters in October, setting off one of the most competitive and watched bidding races amongst cities and states to lure the job-creator. While many bid processes have been secret, Amazon has made a public event of its selection process, creating one of the most pervasive PR campaigns in recent history.
Cities large and small began drafting their bids, releasing viral YouTube videos, arguing their individual merits to the press. For the economic support and reputation boost afforded by Amazon’s global brand, many cities were willing to put it all on the line.
The bids to Amazon were not released publicly, and many details about all or parts of many cities bids are still unknown. But based on freedom of information requests and public disclosures, we have gleaned specifics about the breadth and scope of several offers.
Some of the most aggressive bids that were uncovered or announced seem to have paid off: Newark, New Jersey was able to offer up to $7 billion in tax breaks, after the state voted to give away $5 billion and the city threw in $2 billion of its own. Illinois’ state law allows Chicago to funnel $1.32 billion of Amazon employees’ income taxes back to Amazon itself; and D.C.’s proposal, released yesterday, hints at large personal property tax deductions, and covered corporate franchise tax exemptions.
But a number of finalists made the cut without offering out-of-the-ordinary subsidies: New York, Boston, and Toronto, did not explicitly advertise enormous financial deals in their bids. For these urban centers, prime location, a talented workforce, and major airports were likely key. But while these dense metro areas have tech, talent, and transportation; high housing costs and the question of where to put 8.1 million square feet of real estate in a densely packed urban center might be prohibitive. And while Amazon doesn’t claim to be a benevolent benefactor, a city like New York doesn’t need the investment as much as a city like Philadelphia or Pittsburgh might.
Cities that have long been considered mid-size favorites have also, not surprisingly, risen to the top: Atlanta is home to the busiest airport in the country, full of cheap housing, and its university system is thriving; Austin hosts the headquarters of Jeff Bezos’ recent acquisition, Whole Foods, and might give Amazon political legs in a red state; and Denver gets major quality of life points (think hiking and breweries) and already hosts a growing start-up scene. Philadelphia and Pittsburgh both made the list, which will perhaps pit the two Pennsylvania cities against each other; while Amazon has dubbed Northern Virginia a regional finalist, without bothering to split the area up into county-sized chunks.
Building off the success of their first headquarters in Seattle, Amazon hoped to find a second location that would become a site for innovation and economic prosperity. 50,000 jobs, $5 billion in investment, and 8.1 million square foot in property would follow them into one lucky city, Amazon promised.
All cities had to provide was an itemized list of qualifications, in response to criteria listed in Amazon’s Request for Proposals. The company wanted international connectivity, strong educational centers, diversity, space—and special economic incentives.
“Getting from 238 to 20 was very tough – all the proposals showed tremendous enthusiasm and creativity,” said Holly Sullivan, Amazon Public Policy, in a statement Thursday.
So, the finalists have been chosen. Now what? Amazon representatives say they’ll speak to cities individually about each of their bids before selecting a winner later in 2018. That could mean cities will roll out a second round of gimmicks (more cactuses sent to Jeff Bezos’ doorstep, or orange neon lighting up Fenway Park). It could mean cities who at first relied on geography alone (or offered fewer tax breaks than the rest) will double down on incentive packages. Or something totally unexpected could happen. CityLab’s Richard Florida is calling for cities to make a pact that the finalists take economic incentives off the table, and compete solely on their merits.
11. The 20 finalists would be well-served by making a pact to NO INCENTIVES. These mayors and economic professionals know one another & can do it. One of a number of professional organizations could sponsor.— Richard Florida (@Richard_Florida) January 18, 2018
Other advocates, meanwhile, have suggested that the most likely path to incentives reform would come from the federal government or the courts.
This is a developing story. Check back soon for more updates.