Amazon’s decision to abandon plans for a headquarters complex in Queens offers many lessons.
For starters, residents and elected officials should not be too vocal in expressing opposition to a company planning to bring 25,000 jobs to the area.
Even if the company will be getting $3 billion in tax incentives.
And the company does not have to go through usual land-use review by the City Council for a 4-million-square-foot campus to be built in a city neighborhood.
And the company’s CEO — the richest man in the country — gets to build his very own helipad on the campus.
And the company will not be paying any federal taxes on $11 billion in profits this year.
Loose lips sink large development projects. Especially in Amazon CEO Jeff Bezos’ world.
Amazon officials appeared to have been shocked by the fierce opposition to the deal from a vocal minority consisting mainly of city officials, progressive activists and union leaders.
Which appears to be an indication of the deferential treatment they usually receive from elected officials, their ignorance of New York or both. Seriously, surprise at opposition to a development this size? In New York?
The deal offered to Amazon by Gov. Andrew Cuomo and New York City Mayor Bill de Blasio, both Democrats, does demonstrate a real problem with American capitalism and democracy these days: the loss of a level playing field.
Elected officials regularly extol the virtues and job-creation power of small businesses. But just look at who gets the extra goodies.
Amazon is far from alone in taking advantage of this. In fact, cities, counties and states across the county offer tax breaks and other incentives to usually well-established businesses to relocate to their locales or encourage development.
There are alternatives.
Want to reduce the cost of school or village taxes? Why not eliminate the tax breaks routinely given by the state Legislature to build luxury apartments and luxury offices in New York City?
Want to fill empty storefronts on Main Streets? Why not give breaks on property taxes to landlords located in business districts in which 5 percent or 10 percent of the storefronts are empty and require that the savings be passed onto tenants?
The tax breaks offered to Amazon seems to ignore just how Amazon made its money: out-competing many brick-and-mortar stores. And, in the process, becoming a prime reason for empty storefronts on Main Streets.
In theory, there is nothing wrong with this.
Amazon developed a service that many American consumers wanted and was richly rewarded.
The problem is that Amazon now gets the type of preferential treatment we saw New York offer from virtually every government with which it does business.
This allows Amazon to drive stores out not by virtue of running a better business, but because of lower costs won by their political clout.
Amazon did have much to offer.
Their plan to hire 25,000 highly paid executives and tech workers could have transformed Long Island City into a high-tech hub, indirectly created thousands of additional service jobs, put upward pressure on wages and generated more than $1 billion in additional revenue each year.
And it is not as if New York was alone in seeking to shower Amazon with incentives to bring jobs to their communities. More than 230 other localities were competing with New York for the honor.
And their decision to abandon their plans is a loss to New York’s economy.
But the question still needs to be asked: Should government subsidize individual businesses? And if so, how are they selected?
Most New Yorkers supported the Amazon deal, but some Democratic lawmakers argued that the tech giant did not deserve $3 billion in government incentives and expressed concerns about the rising costs of living in gentrifying neighborhoods. This includes several lawmakers who represent the area in which the headquarters was to be located.
This makes the response of some Nassau County officials, who blasted Democratic lawmakers opposed to the project, especially instructive and, to be polite, a little rich.
“I’m horrified and appalled that a small faction of local officials sought to kill an effort that was certain to bring countless economic benefits to millions of New Yorkers, including many in the Town of Hempstead,” Hempstead Town Supervisor Laura Gillen said.
Gillen apparently forgot about the Lighthouse Project, a $3.8 billion effort led by Charles Wang to redevelop the Nassau Hub and remake the Coliseum in part, to keep his hockey team, the New York Islanders here.
That plan effectively died in 2009 because of concerns about the scope of the project by the Hempstead Town Council. And the Islanders left for Brooklyn.
A plan by the Nassau County Regional Off-Track Betting Corp. to locate 1,000 video lottery terminals in Nassau County was also defeated. Twice. Once at the former Fortunoff site in Westbury and the second time at Belmont.
Unwanted traffic was the stated objection both times.
The state Legislature eventually bailed out Nassau County by transferring Nassau County’s authority to install 1,000 video slot machines to Aqueduct Racetrack. In Queens.
More recently, the Town of North Hempstead has led the charge in Nassau County to restrict the location and number of medical marijuana facilities and, if its use is approved by the state Legislature, bar the sale of recreational marijuana stores.
In response to the opposition to one medical marijuana facility seeking to move to a retail location in Manhasset, the North Hempstead Town Council passed not one, not two, but three bills.
The first effectively shunted people with cancer, AIDs and other serious ailments to out-of-the-way locations in the town. The other two barred recreational sales in the town.
Presumably, those unable to purchase marijuana here will go to the closest place that does not bar its sale — Queens
There are now new plans to develop the HUB and bring the Islanders back to Belmont. We hope that town and county officials have learned their lessons, as it appears, and they move the projects forward.
But they might consider withholding criticism of New York City officials until they show that they can do a better job in supporting business development here.
