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Amazon's second headquarters clears blocks in Virginia funding vote



WASHINGTON (Reuters) – Amazon.com Inc's planned second headquarters in northern Virginia cleared a key test on Saturday when local officials approved a proposed financial package worth around $ 51 million amid a small but vocal opposition.

Reuters / Kevin Lamarque

Amazon.

People are moving around the front of the rostrum before a news conference about the announcement that Crystal City has been selected as home to Amazon's new headquarters in Arlington, Virginia, USA, November 13, 2018. REUTERS / Kevin Lamarque

Amazon In November, picked up the National Landing, a jointly owned company in Arlington County and the city of Alexandria, just outside Washington, along with New York City for its so-called HQ2 or second headquarters. That followed a year-long search in which hundreds of municipalities, ranging from Newark, New Jersey to Indianapolis, competed for the coveted tax-dollars and high-wage jobs that the project promised.

Amazon in February abruptly scrapped plans to build part of its second headquarters in New York's borough of Queens after opposition from local leaders angered by incentives promised by state and city politicians.

The five-member Arlington County Board voted 5-0 in favor of Amazon after receiving a financial package after a seven-hour meeting held in a room filled with up to 150 citizens and representatives from local unions and minority advocacy groups.

There was strong opposition from some residents and labor groups, many of whom chanted "shame" and waved signs with slogans including "Do not be the opposite of Robinhood," "Amazon overworks and underpays," and "Advocate for us and not Amazon. "One protester was escorted out of the meeting by police.

A few dozen protesters outside the county office chanted, "The people united will not be defeated."

Danny Candejas, an organizer for the coalition "For Us, Not Amazon," which opposes the company's move to the area. , said: "We are fighting to ensure that people who live here are not priced out by wealthy people."

Some supporters in the meeting held up signs saying "vote yes" and "Amazon is prime for Arlington."

One hundred and twelve people were registered to speak, an unusually high number for a local county meeting, forcing the board chair Christian Dorsey to cut the talking minutes to two minutes, from three, for every regular speaker, and to four minutes, from five, for representatives of organizations.

Many speakers who were opposed to the Amazon headquarters were particularly opposed to direct incentives, citing rising housing costs, the likely displacement of low-income families, accelerated wage-alienation for construction workers, and the lack of investment guarantees in affordable housing funds.

"One speaker, Hunter Tamarro, said:" Speculators are already raising their home prices, landlords are raising rents and general contractors are raising their quotes for home improvement projects. "

Unions, including the AFL-CIO, have objected to Amazon not signing a draft labor contract with wages and benefits for workers hired to build new buildings.

But supporters such as resident June O'Connell said Amazon's presence would ensure Arlington has been allocated state funds for investments in transport and higher education. "I want that money from the state," O'Connell said. "Without Amazon, we would not get a penny of it."

Holly Sullivan, Amazon's global head of economic development, spoke briefly and said that the company will invest about $ 2.5 billion, creating more than 25,000 jobs with average wage of over $ 150,000, which will generate more than $ 3.2 billion in tax revenue.

"Regarding incentives, Amazon is only eligible for the financial incentive after we make our investments and occupy office space in the community," she said.

Dorsey, the board chair, had said before the vote that he expected the measure to pass. He said that rejecting Amazon would not solve the community's problems and concerns, and that this was the first deal that the county has hit where new revenue growth will be used to fund it.

To be sure, the vote approved an estimated $ 51 million, a fraction of the $ 481 million promised by the county. Only 5 percent of the incentives are direct. Also, Amazon has been offered a $ 750 million package by the state that the Virginia General Assembly approved with little opposition.

The $ 51 million includes a controversial direct financial incentive or a cash grant of $ 23 million to Amazon over 15 years, which will be collected from taxes in Arlington hotel rooms. The grant is contingent upon Amazon occupying six million square feet of office space over the first 16 years.

Arlington has also offered to invest about $ 28 million over 10 years of future property tax revenue in onsite infrastructure and open space at the headquarters site.

A filing on the county board's website says the $ 23 million grant and $ 28 million in strategic public infrastructure investments were "instrumental in Amazon choosing Arlington for its headquarters."

Reporting by Nandita Bose in Washington; Editing by Richard Chang and Daniel Wallis

Our Standards: The Thomson Reuters Trust Principles.

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