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EDITORIAL: The Amazon payoff

Amazon's headquarters in Seattle. Courtesy Photo/Amazon.com

Amazon’s announcement that it will grace some fortunate community with its second headquarters -- a $5 billion palace home to 50,000 employees and the harbinger of innumerable riches -- has set off a frenzy of choose-me bids that rival the awarding of the Olympic games to a deserving community. Count Loudoun County among them.

What community wouldn’t want Amazon? The company has been heralded by some as the most innovative, most admired, most reputable, most-most company in the world. Landing Amazon’s headquarters is a game changer.

In its eight-page Request for Proposals (RFP), Amazon lists the physical and social assets that bidders should meet. The term sheet includes:

--A metro area of at least 1 million people. An international airport no more than 45 minutes away.
--Mass transit service and major highways.
--A highly educated labor pool.
--A strong university system.
--Good cellphone and fiber coverage.
--Abundant and affordable housing.
--A political and social culture that supports a “diverse population” and “overall high quality of life.”

That part of the RFP is a beauty contest. Loudoun doesn’t need makeup to look the part.

But asking it and other communities to make presentations about these factors is just the preliminary judging. Amazon can easily discover and assess a community’s assets without ogling the contestants or putting them through a meaningless talent competition. The customer-centric company didn’t rise to its reputation without paying attention to the data it gathers.

That brings a more pertinent question: What is a community prepared to do for Amazon? Amazon gives the game away on page six of its RFP:

“We acknowledge a project of this magnitude may require special incentive legislation … for the state/province to achieve a competitive proposal.”

That’s code for Amazon extracting as much as it can in subsidies, tax incentives and public grants. In other words, corporate welfare for a company with a market cap of $466 billion.

One of the most successful companies in the world, Amazon has used this tactic before in selecting locations for dozens of distribution facilities and data centers, some of which are located in Loudoun. By playing states and localities against each other for maximum incentives, Amazon has garnered more than $1.1 billion in incentives, according to subsidy-tracker Good Jobs First.

It is hard to know how deep into the public’s pockets Loudoun County and the commonwealth of Virginia might delve. Given the initial response from county leaders, it’s a fair bet that they’ll respond with tax incentives and other public giveaways to land the prize.

It is hard not to get caught up in the enthusiasm over Amazon. But if Loudoun is as fertile a ground for economic development as our leaders tout, should the county acquiesce to a demand for a payoff at the expense of its taxpayers?


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