One US city is calling BS on Amazon’s new headquarters search

Not everyone wants HQ2.
Not everyone wants HQ2.
Image: Reuters//Brian Snyder
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Amazon’s September announcement that it’s taking bids for the site of its second North American headquarters has sparked a fierce competition among US cities eager to land the $5 billion new complex and the 50,000 jobs it’s expected to bring. New Jersey pledged $5 billion in tax breaks. Philadelphia offered 28 million square feet of office space. Tucson, Arizona sent a 21-foot cactus.  And there were plenty of other outlandish inducements.

But in a letter informing the company that it would not be submitting a bid, the city of San Antonio, Texas, offered a middle finger to the whole gimmick-laden search.

“It’s hard to imagine that a forward-thinking company like Amazon hasn’t already selected its preferred location. And if that’s the case, this public process is, intentionally or not, creating a bidding war amongst states and cities,” mayor Ron Nirenberg and Bexar County judge Nelson W. Wolff wrote Oct. 11 to CEO Jeff Bezos. “Blindly giving away the farm isn’t our style.”

San Antonio’s decision isn’t likely to break any hearts in Amazon’s current Seattle base. The Texas city lacks many of the amenities Amazon requires and was never mentioned on the short list of probable contenders. (Likely finalists include Boston, Chicago, Austin, Dallas, Denver, and Washington DC.)

It’s also not fair for San Antonio to paint itself as entirely opposed to incentives, as local media have pointed out. Earlier this year, the city gave out almost $9 million in tax incentives to keep the credit union Credit Human from relocating.

But San Antonio’s stance legitimately questions the value of having cities and states rushing to offer public subsidies to a company with a checkered history of employment practices. As Quartz’s Alison Griswold has pointed out, Amazon wields an enormous amount of power. The new headquarters is so big and glittering a prize that it may blind some government officials to whether it’s actually a good deal for the public.

“It has to be the right fit; not just for the company but for the entire community,” San Antonio’s leaders wrote. “Does it create good jobs? Does it offer good benefits for employees? Are there opportunities for small businesses? Is the company a good ‘corporate citizen?’”

Better for a city to spend resources building itself into a place any company would consider an attractive home, the city officials argued, rather than using them to lure just one.