Fact or Fiction
Gov. Andrew Cuomo says Amazon’s new Queens headquarters will be treated no differently than other projects.
According to The NY Times, Amazon agreed to split their HQ2 offices; between Long Island City in Queens, New York and Crystal City in Arlington, Virginia while promising to create 25,000 job opportunities for both sites.
However, some politicians are questioning the changes that could occur in Long Island City, as well as the number of financial incentives offered to Amazon.
On November 18, Cuomo claimed that the incentives outlined for Amazon will be handled like other businesses.
What kind of public oversight is expected for this deal?
Cuomo issued statements addressing this concern during an interview with New York public radio station, WNYC.
“There is nothing that we have done on Amazon that we have not done with hundreds of other projects,” Cuomo said. “There are hundreds of businesses in New York that receive these types of tax credits and capital grants, because, competitively we have to work hard to get people to come here because of our tax structure.”
According to the statistics from Citizens Budget Commission (CBC), the state offered Amazon as much as $1.7 billion in benefits and New York City offered up to $1.8 billion.
Also, the state is offering up to $1.2 billion in tax credits from the Excelsior Jobs Program and a capital grant up to $505 million.
The reason why the Excelsior costs are restricted at $500 million annually is to maintain fiscal affordability and to ensure that New York residents can realize a positive return on their investment.
The Excelsior provides job creation and investment incentives to fields such as biotechnology, pharmaceutical, high-tech, clean-technology, green technology, financial services, agriculture, and manufacturing.
But in this case, the Excelsior credits are connected to Amazon’s commitment to create 25,000 jobs and invest $2.3 billion. Also, the capital grant is connected to the initial commitment and prospective milestones.
Cuomo mentioned all of these incentives offered to Amazon, as they are standard for many companies in New York.
The capital grant is voluntary but has been offered to thousands of companies. For example, the state spent $750 million in taxpayer money to build and equip the RiverBend factory in Buffalo and provided $70 million for Regeneron in the Capital District.
Many experts have given their opinions on this project and Cuomo’s statements.
“It’s totally accurate on his part, unfortunately,” said Reinvent Albany Executive Director John Kaehny. “This is only big because of the scale of it.”
David Friedfel, a director of state studies at the CBC, said on WCNY that the nature of the incentives offered to Amazon is similar to those offered to other companies.
Fact or Fiction
Cuomo indicated in media sessions that the Amazon deal will be handled like other projects in the city. His claim that hundreds of businesses have gone through similar processes is true.
While Amazon’s move to New York has been lauded as a big one, the incentives of the agreement tell a different story. It may have seemed large due to the subsidies, but in reality, this plan has been used on hundreds of statewide projects.