In one of the most aggressive attempts to cajole Amazon into selecting their state as the location for the e-commerce giant’s second headquarters, the Maryland General Assembly just passed a bill offering the company a $5 billion incentive package should Amazon choose to settle in Maryland’s Montgomery County.
Montgomery County is competing with Washington DC, Northern Virginia and 17 other areas that made Amazon’s HQ2 “short list”, which was released earlier this year. Specifically, Amazon is eyeing the site of the former White Flint Mall.
The “Promoting ext-Raordinary Innovation in Maryland’s Economy,” or PRIME (yes that misplaced capitalization was intentional) would require Amazon to create at least 40,000 qualified jobs (with an average comp of at least $100,000). The company would also need to spend $4.5 billion on “eligible costs” like capital projects, the Baltimore Business Journal reported.
After passing the House, the bill now passes to the desk of Maryland Gov. Larry Hogan.
As lawmakers see it, if Amazon chooses Montgomery County, the incentives will be worth the 50,000 jobs the company could bring to the county. If Amazon doesn’t, the state loses nothing.
Montgomery County, specifically a site encompassing the former White Flint Mall, is the only Maryland site on Amazon’s HQ2 short list. Maryland is competing with Washington, D.C., Northern Virginia and 17 other areas across the country for the 50,000 jobs and $5 billion investment the online retail and web services giant has promised with its second headquarters. Seattle-based Amazon is expected to fill at least 8 million square feet as it phases in HQ2 over the next two decades.
However, while the bill found broad support among Democratic state legislators, Republicans vehemently opposed it on the grounds that it amounted to a corporate giveaway. A legislative study found the bill would cost the state $5.5 billion in total revenue through 2054 – while the county would lose nearly $1 billion. However, that analysis doesn’t factor in any revenue generated by Amazon.
Opposition to the bill, largely from Republicans, was intense. They described the incentive — to include roughly $3 billion in property, income and sales tax credits and $2 billion in transportation improvements — as a “bribery package,” an “expensive pig in a poke,” as “craziness,” as “corporate welfare,” and as a “gold mine” for one of the wealthiest companies, led by one of the wealthiest people, in the world.
“They need economic stimulus like a fish needs a bicycle,” said Del. Herb McMillan, R-Anne Arundel.
However, a private study produced by the Sage Policy Group at the state’s request found that Amazon’s headquarters could pump $7.7 billion in wages into the state while producing $17 billion in increased economic activity.
Amazon is expected to announce its HQ2 later this year, but there have been hints that the headquarters could wind up either in Montgomery or somewhere else in the broader Washington, DC area.
A surge in web traffic to an article about an environmental award won by Arlington County from an internal Amazon intranet led to speculation that Maryland could be the company’s pick – or at least it would be a strong contender.
And another study found that the Washington DC area would be the most sensible pick for Amazon.
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