One of the most controversial aspects of Amazon’s year-long search for a second headquarters was the request for government incentives in exchange for creating thousands of jobs and investing billions of dollars in the winning community. Critics were outraged that the incentives cities offered were largely kept under wraps as Amazon made its decision.
Today those incentives have finally been revealed as Amazon unveiled the two cities that will each get half of the promised Amazon HQ2.
Here’s what Arlington Virginia is offering Amazon, according to the company’s announcement Tuesday:
Amazon will receive performance-based direct incentives of $573 million based on the company creating 25,000 jobs with an average wage of over $150,000 in Arlington. This includes a workforce cash grant from the Commonwealth of Virginia of up to $550 million based on $22,000 for each job created over the next 12 years. Amazon will only receive this incentive if it creates the forecasted high-paying jobs. The company will also receive a cash grant from Arlington of $23 million over 15 years based on the incremental growth of the existing local Transient Occupancy Tax, a tax on hotel rooms.
Virginia is also making investments in its homegrown tech talent, promising to double the number of graduates in computer science and related fields to 25-35,000 additional workers in those industries. Virginia Tech will establish a new Innovation Campus in Alexandria tied to Amazon’s project. Virginia, Arlington, and Alexandria are also funding transportation improvements in the area.
New York City is offering Amazon the following incentives in exchange for its half of HQ2, which will be located in the Long Island City neighborhoods of Queens, New York:
Amazon will receive performance-based direct incentives of $1.525 billion based on the company creating 25,000 jobs in Long Island City. This includes a refundable tax credit through New York State’s Excelsior Program of up to $1.2 billion calculated as a percentage of the salaries Amazon expects to pay employees over the next 10 years, which equates to $48,000 per job for 25,000 jobs with an average wage of over $150,000; and a cash grant from Empire State Development of $325 million based on the square footage of buildings occupied in the next 10 years. Amazon will receive these incentives over the next decade based on the incremental jobs it creates each year and as it reaches building occupancy targets. The company will separately apply for as-of-right incentives including New York City’s Industrial & Commercial Abatement Program (ICAP) and New York City’s Relocation and Employment Assistance Program (REAP).
Amazon also plans to set up a 5,000-person “Center of Excellence” in Nashville. For that project, Amazon will receive the following:
Amazon will receive performance-based direct incentives of up to $102 million based on the company creating 5,000 jobs with an average wage of over $150,000 in Nashville. This includes a cash grant for capital expenditures from the state of Tennessee of $65 million based on the company creating 5,000 jobs over the next 7 years, which is equivalent to $13,000 per job; a cash grant from the city of Nashville of up to $15 million based on $500 for each job created over the next 7 years; and a job tax credit to offset franchise and excise taxes from the state of Tennessee of $21.7 million based on $4,500 per new job over the next 7 years.