Question of the day
Friday, Feb 15, 2019 - Posted by Rich Miller
* Chicago Business Journal…
Illinois Gov. J.B. Pritzker and Chicago Mayor Rahm Emanuel want Amazon.com Inc. to take another look at Chicago.
In the wake of Amazon (Nasdaq: AMZN) ditching plans to open an 8-million square foot campus in Long Island City in the borough of Queens after pushback from some of New York’s elected officials, the pair wrote a letter to the company saying Illinois and Chicago would welcome the tech giant and the thousands of jobs it would bring.
“Chicago and the State of Illinois remain focused on supporting business growth and innovation, and we are more ready than ever to do great things with Amazon HQ2. You should take another look at Chicago. We will be happy to bring you back,” the pair wrote in a letter.
In their letter, they suggested that Amazon should consider moving to Related Midwest’s proposed 62-acre development site called The 78, which is located in the South Loop just south of Roosevelt Road along the Chicago River. Amazon officials toured The 78 site in mid-August.
“We have also made substantial progress toward the launch of ‘The 78′ development, which has received strong support from the surrounding communities and received unanimous support from the Community Development Commission a 15-member board responsible for reviewing and approving Tax Increment Financing (TIF) funding for private redevelopment projects. ‘The 78′ development and corresponding infrastructure support from the City is scheduled to receive final legislative approval in April and will break ground shortly thereafter,” the letter, which can be seen here, read.
* The Question: Do you agree with this move by the governor? Take the poll and then explain your answer in comments, please…
online survey
- Huh? - Friday, Feb 15, 19 @ 2:30 pm:
Why is Illinois planning to give away the store to a company that made $11 billion last year and paid no income tax?
- Anonymous - Friday, Feb 15, 19 @ 2:32 pm:
I voted Yes, but IL has about .001 chance of landing Amazon
- Lt Guv - Friday, Feb 15, 19 @ 2:32 pm:
Voted yes. Jobs are good.
- Groucho - Friday, Feb 15, 19 @ 2:32 pm:
25,000 good paying jobs are worth the effort.
- Sue - Friday, Feb 15, 19 @ 2:34 pm:
Kind of silly since Amazon announced they are not going forward with anything other then Virginia and Nashville
- Perrid - Friday, Feb 15, 19 @ 2:34 pm:
I voted yes but I would want to know the exact handout we would be giving to Amazon.I am very, very leery of giving them any actual money, or even too big of a tax credit. I have no knowledge or opinion on how this would affect housing in this or whatever area Amazon would choose, though that would also play some role in my (inconsequential) final decision.
In general though, unless we gave them the shirt off our back, I think any big business would be a good idea, and tax credits themselves aren’t that bad, though letting them work in the state for close to free bugs me.
- slow down - Friday, Feb 15, 19 @ 2:36 pm:
The devil is obviously in the details but the opportunity to further establish Chicago as a go to hub for tech businesses shouldn’t be underestimated.
- WSJ Paywall - Friday, Feb 15, 19 @ 2:37 pm:
Yes. I have zero opposition to Amazon 25,000 jobs if an agreement is fair to the city.
- OutOfState - Friday, Feb 15, 19 @ 2:38 pm:
I voted no. If the Gov believes he can get Amazon to move to Chicago without giving away tax benefits, then it’s fine. But it doesn’t make sense to make concessions to get Amazon to come to Chicago, when public pensions already need the State to hold onto any revenues they can get. The counterargument would be that an investment in the form of tax incentives would provide returns in the form of higher tax revenues and economic stimulus. However, state tax incentives for private business are shaky investments with a high risk of failing.
Also, the high risk of gentrification spreading south if the project creates the number of jobs it claims to makes this a lose-lose proposition.
- Oswego Willy - Friday, Feb 15, 19 @ 2:40 pm:
Voted “No”
Nope.
Why go out on that limb, publicly, and be rejected.
“We’ve indicates to Amazon that if they are looking for another location, we’d hope they’d reconsider the bid that was submitted and the changes in Illinois government.”
This idea of again trying to chase this, Rahm is halfway out the door, so any blowback will be that “Pritzker failed to land Amazon.”
Both Pritzker and Rahm coulda played this far closer to the vest with more protection and upside, instead of leading with their chins here to get knocked again, publicly.
Too much public downside to be as proactive as this attempt is.
Also, this would complete my thought.
“We’ve indicates to Amazon that if they are looking for another location, we’d hope they’d reconsider the bid that was submitted and the changes in Illinois government. Amazon has indicated a greater investment in hubs like we have here in Illinois and we look forward to Amazon’s continued and growing presence in Illinois.”
Take a lil credit to the expansion created by NYC’s rebuff
So… I voted… “No”
- Nick - Friday, Feb 15, 19 @ 2:40 pm:
It won’t happen, but why not, it’s worth a shot.
I don’t remember what the total worth/structure of our offer was, but I do think Illinois/Chicago are in a position where something like Amazon would be a real boost to the area. Versus places like NoVa or New York which frankly don’t really need the extra development.
- JoanP - Friday, Feb 15, 19 @ 2:45 pm:
I didn’t answer. Because my answer is “it depends”.
I’ll preface this by saying that I am not a fan of Amazon or of Jeff Bezos. I am a fan of jobs.
But, I wouldn’t want Illinois to give away the store for small returns. From what I’ve read, New York would have paid Amazon $100,000 per job. And I also would be concerned about Amazon pulling a stunt like Foxcomm’s.
Interesting NYT article that says:
“But two people involved in internal discussions at Amazon said the company’s concerns were not primarily that the deal would fail to receive government approval. Executives were confident it would cross the finish line.
“The company instead felt that, with little sign that the opposition was dissipating, it was staring down a decades’ long commitment to a political climate in which everything the company did would be scrutinized.”
Why shouldn’t they be scrutinized? Why should they get “highly deferential treatment”(which the article says they are used to)?
- Flapdoodle - Friday, Feb 15, 19 @ 2:51 pm:
However attractive those Amazon jobs appear, their price tag will be substantial and require decades to recover. For a city and state already facing crisis-level financial problems, investing in a project with high up front costs and delayed benefits just doesn’t seem wise.
- What's in a name? - Friday, Feb 15, 19 @ 2:52 pm:
No harm in asking. It’s unlikely to succeed but at least this Gov is making the effort and not bad mouthing the State at every turn.
- Thomas Paine - Friday, Feb 15, 19 @ 2:53 pm:
I don’t think there is any harm.
Yes, there is a good shot it will not bear any fruit.
But unlike the failed Olympic bid it’s not like repitching this out there will cost us anything financially.
They might have made their decision, but this is a Bezos-led organization, and whatever Bezos decides he can undecide.
As for the potential political fallout of failing, JB is just gonna have to man up and take those arrows, like Rauner promised to.
Personally I think it’s a strong move that shows Pritzker leading, and doing it without Madigan in the picture.
- ChrisB - Friday, Feb 15, 19 @ 2:56 pm:
No. We don’t need New York’s scraps. Plus Amazon already said they weren’t reopening the bids. This just looks desperate.
Looking back on this whole fiasco though, the Mayor really should have thrown in some headshots of the local news anchors with Chicago’s bid. Pretty sure that would have sealed the deal.
- don the legend - Friday, Feb 15, 19 @ 3:08 pm:
Voted yes. Maybe Jeff Bezos will consider an offer from a real billionaire rather than a wannabe billionaire.
- RNUG - Friday, Feb 15, 19 @ 3:08 pm:
I voted yes … but with the qualifier they have to take the Thompson Center off our hands.
- Lucky Pierre - Friday, Feb 15, 19 @ 3:25 pm:
Give away the store? Take decades to recover?
Stunning ignorance about tax abatements work.
“After some four months of vocal opposition, the e-commerce giant has decided its had its fill of the tongue-lashing the company has taken from elected officials, labor leaders, and residents on a deal that would bring 25,000 jobs and $27 billion in tax revenue to New York. In a Thursday afternoon blog post the company announced that it is cancelling plans to bring a new campus to Long Island City, Queens—leaving a $3 billion incentive package on the table.”
https://ny.curbed.com/2019/2/14/18225029/amazon-hq2-nyc-deal-canceled
Who wouldn’t “give away the store - $3 billion” to get $27 billion in tax revenue and 25,000 150k a year jobs?
- City Zen - Friday, Feb 15, 19 @ 3:28 pm:
Yes. We’ve already put ourselves out there.
The one positive about Amazon backing out of NYC is exposing how many folks (including those currently in DC) do not understand what a subsidy is.
- Christopher - Friday, Feb 15, 19 @ 3:28 pm:
I voted no. I’m sure that Chicago gave its all before but, simply, Amazon did not pick it. That should be enough there. Besides, Amazon has subsequently said it won’t re-open the bid competition.
- Westside TB - Friday, Feb 15, 19 @ 3:30 pm:
I voted yes. The tax breaks are worth it over time for the increased employment and its associated income tax revenues to the state. Not to mention the additional residential construction this would spark which would help out with the property tax burden.
- CubsFan16 - Friday, Feb 15, 19 @ 3:30 pm:
It is highly unlikely we will get Amazon. With that said, I don’t see why we wouldn’t at least reach out to them. If your reasoning for voting “no” is that it is just unrealistic, that is fair. To those voting “no” because they don’t want Amazon…
Could our city not do well with $27 billion in tax revenue?
Could our city not do well with some positive national press if we were to acquire them?
The $3 billion in tax breaks are more than paid for in the $27 billion in investments that could be made in our schools, infrastructure, and vulnerable communities.
Before we complain about what we are giving away, let’s look at what we are getting in return.
- Cheryl44 - Friday, Feb 15, 19 @ 3:31 pm:
No. Foxconn
- Da Big Bad Wolf - Friday, Feb 15, 19 @ 3:34 pm:
Too bad “I don’t know” isn’t an option.
As to Amazon’s spokesmen saying they won’t use a second headquarters, I don’t believe it. Why would they decide they need a third headquarter, spend over a year looking and deciding and planning, then suddenly they don’t need a third headquarters? It sounds like a prelude to negotiations, trying to not sound desperate.
- Bogey Golfer - Friday, Feb 15, 19 @ 3:37 pm:
Voted ‘no’. What kind of jobs are we talking about? We need to balance some of the high-techs with warehouse / distribution jobs that do not require advanced degrees.
- Responsa - Friday, Feb 15, 19 @ 3:40 pm:
I have no problem with the reach out to Amazon. Doesn’t hurt to ask. But they made very clear in their statement yesterday that they were finished talking with New York and that they would be allocating work and jobs between VA and WA and the Nashville distribution center as opposed to adding another new site. I think they are just disillusioned and “done” with the bidding and selection and permit process and I don’t blame them.
- Da Big Bad Wolf - Friday, Feb 15, 19 @ 3:41 pm:
But the reason I don’t know, is even though Illinois could use the jobs, something about Amazon’s abrupt decision seems too bizarre.
The Amazon project had the support of the two most powerful politicians in New York, they had broad public support and 3 billion sitting on the table. And they walked away?
Because of the paster, who said he wanted people of the community to get some of those jobs? This isn’t “eat the rich” rhetoric. Because a couple of state senators with very little power were skeptical? A couple of hippie protestors? Come on.
- Actual Red - Friday, Feb 15, 19 @ 3:53 pm:
I voted no. I agree with many that jobs are good, but not all jobs are the same. We have to be realistic about the types of jobs being created - these aren’t going to go to the people in Chicago most desperately in need, they are going to bring in a lot of people from out of town, and likely bring a lot of luxury developments that displace folks who are already here. Now, if we had safeguards in place to mitigate this (strong public housing, rent control) then it might be worth it. Combined with the generous tax breaks, it’s dangerous.
I also think it’s worth noting that Amazon pulled out of NY because they didn’t like the cold reception they were getting from locals. It wasn’t because they didn’t think they could actually get the site built. This tells me that Amazon isn’t only interested in making money - it’s interested in control. Look at how much power Amazon was able to exert over state/local governments just by suggesting it might build its HQ in their city. Imagine they kind of influence it’ll have once it actually set’s up shop here. Amazon only wants to be in your city if it can run things. Not worth it.
- jaybirch - Friday, Feb 15, 19 @ 4:03 pm:
Not if we are giving away money for jobs that will displace current residents. Maybe if Amazon paid ANY actual tax dollars.
- Rabid - Friday, Feb 15, 19 @ 4:04 pm:
Just dumped $700,000,000 downstate, JB take Jeff out on the town
- City Zen - Friday, Feb 15, 19 @ 4:08 pm:
==hat kind of jobs are we talking about? We need to balance some of the high-techs with warehouse / distribution jobs that do not require advanced degrees.==
What if there was an initiative to bring a 2nd branch of one of the top medical hospitals in the country, such as Mayo2 or Johns Hopkins2? Would there be such a stink made over the ratio between the high paid doctors and the folks cleaning bed pans?
- IllinoisBoi - Friday, Feb 15, 19 @ 4:11 pm:
Yes … but only if Amazon pays its fair share of taxes.
- Ginhouse Tommy - Friday, Feb 15, 19 @ 4:28 pm:
I agree with Da Big Bad Wolf that Bezos behavior lately has been everywhere. A questionable decision on NYC, now retracted, saying that Amazon go bankrupt in the future, making bids for New England sports channels. What’s next? I would tread carefully if I were JB. I don’t think he really knows what he wants.
- Pundent - Friday, Feb 15, 19 @ 4:28 pm:
=We need to balance some of the high-techs with warehouse / distribution jobs that do not require advanced degrees.=
Except that we’re overrun with warehouse/distribution centers. They dot every interstate outside of Chicago and in the current tight labor market they struggle to get enough workers.
- You could say that, I couldn't - Tuesday, Feb 19, 19 @ 12:46 pm:
I voted no, but there’s a big asterisk. I have no problem courting Amazon and selling Chicago as a great location to them. The real question is whether we should be selling Chicago by saying we will shower them with tax breaks.
To that, the answer is unequivocally “no.” That’s for a lot of reasons, starting with the historical record of companies who got tax breaks never delivering jobs, to the idea that someone somewhere has to stop this ridiculous race to given corporations the biggest tax break everytime they even mention “relocation,” to the idea that my tax dollars should not be used to pad the bottom line of the richest man in the world.
Amazon, Chicago would be a great location for your HQ2 because we have the infrastructure, the human and social resources, the institutions, and the quality of life that would attract the best talent. You are welcome here as a neighbor and member of the community. But that also means you will be treated the same as everyone else, and we expect you to contribute to your new home.