Editor’s Note: Robert B. Engel is the chief spokesperson for the Free & Fair Markets Initiative, a nonprofit coalition of consumers, small business owners, and taxpayers who are advocating that giant technology companies do their fair share in local communities. Mr. Engel asked to contribute this editorial after seeing our reporting last week on DFW Airport’s enormous incentive package that it offered Amazon.
A few prescient details from DFW Airport’s bid for Amazon’s second headquarters finally came out from under lock-and-key last week, and the offerings were jarring: an astounding $23 billion over 99 years, 250 acres, and a cadre of other jaw-dropping giveaways. But even beyond the incentives, it’s clear as day that the entire HQ2 process was a charade from the get-go, as Amazon walked away with sensitive city data on economic development plans and infrastructure investments that is sure to give the company a giant leg up over Dallas businesses for decades to come.
Here’s a thought: rather than serving up half-baked justifications and silver linings, Dallas lawmakers should finally level with taxpayers and release the bid. They must provide answers as to whether Dallas volunteered troves of economic development and infrastructure information. And if they did, lawmakers must vow to jettison this give-away-the-store approach that makes it nearly impossible for local companies to compete.
By fielding bids from 238 municipalities, Amazon obtained details about public education and transportation systems, local talent pools, and unoccupied land and real estate. For example, San Francisco’s 160-page proposal describes major housing development plans and offers a chart with a neighborhood-by-neighborhood breakdown. Wisconsin’s bid includes statistics about university and college graduates and what kind of degrees they got. Toledo’s bid provides details about possible sites for a major corporate headquarters, including zoning, ownership and even the various utility companies that deliver services to each site.
Amazon’s head of economic development even admitted that the HQ2 sweepstakes gave them a window into the future economic plans of the 238 communities that submitted bids. “Through this process,” she said, “we learned about many new communities across North America that we will consider as locations for future infrastructure investment and job creation.” In fact, after announcing the 20 HQ2 finalists back in January, Amazon sent each location a nearly 30-page request of specific questions to be answered by March. Boston went so far as to tell Amazon how many residents live close to a park and how many get to work on foot.
Dallas’ proposal for HQ2 is likely a data dump that rivals the rest. It’s possible that the bid included labor and wage rate information; transportation information; housing capacity; crime rates; energy costs. Armed with this amount of information on the city and local communities, Amazon could plan to expand into a neighborhood of its choice and force out small businesses that had no way to see the tech giant coming. However, since the bid remains largely under wraps, Dallas communities can never know what sort sensitive information Amazon is now privy to. We only know what we offered up.
The toll on Dallas businesses and local economies across the country could be disastrous. Benefitting from seemingly endless special treatment, Amazon has already rapidly expanded its shipping and distribution network and gained an unprecedented competitive edge. Now, because of the HQ2 bidding process, Amazon knows when, where and how communities plan to invest – data every local business should have access to as well. It is simply outrageous that Amazon has insider information.
Dallas lawmakers need to swear off giving away massive amounts of data in desperate attempts to get a major corporation to do business in the city. And while they are at it, they should tell Amazon that they can well afford to build future facilities on their own dime. Since 2000, Amazon has received a staggering $287 million in subsidies from Texas taxpayers, making the state one of the top Amazon subsidizers. In fact, just last year Amazon struck two deals with Texas on new facilities in Coppell and Katy – the terms of which are still secret. This is money that could be used to invest in greater education funding, infrastructure renewal, or expanded healthcare services.
The ugly truth is there is no silver lining to the HQ2 process, but this should be a wake-up call to all lawmakers: corporate kowtowing is a losing game. Lawmakers must promise residents that this mistake will never be repeated.