Amazon Cancels Plans for Long Island City Headquarters in Sudden Announcement

The new headquarters would have brought at least 25,000 jobs in exchange for nearly $3 billion in tax incentives. On February 14, 2019, Amazon announced the company was canceling its plans to open a new headquarters located in Long Island City, Queens after political pressure from local and state lawmakers.

The plans for the headquarters were highly controversial. Supporters of the deal highlighted the company’s plans to bring 25,000 jobs that would bring a projected $27 billion in revenue for New York. Opponents to the deal cited many fears, from the stresses on Long Island City infrastructure, transportation and housing to the impacts Amazon could have had against unions.

In a blog post, Amazon stated, “After much thought and deliberation, we’ve decided not to move forward with our plans to build a headquarters for Amazon in Long Island City, Queens. For Amazon, the commitment to build a new headquarters requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term. While polls show that 70% of New Yorkers support our plans and investment, a number of state and local politicians have made it clear that they oppose our presence and will not work with us to build the type of relationships that are required to go forward with the project we and many others envisioned in Long Island City.”

After Amazon made the announcement for the Long Island City headquarters last November, many City and state elected officials voiced opposition to the nearly $3 billion in tax incentives Amazon would receive as part of the deal to open new headquarters in Long Island City. Elected officials argued that taxpayers should not have to subsidize the salaries for 25,000 workers. Local residents also cited concerns over the stress on local infrastructure and transportation that 25,000 additional people would add to Long Island City and fears that the company’s presence would further push rents higher and local residents out of Long Island City. For CityLand’s coverage of the Amazon deal announcement, click here.

The City Council held two hearings questioning Amazon and state officials regarding the Amazon deal-making process. During the second hearing, held on January 30, 2019, City Council Speaker Corey Johnson asked Brian Huseman, the Vice President of Public Policy at Amazon if Amazon would “agree to neutrality if workers at Amazon wanted to unionize” to which Huseman responded “No sir” and “we would not.”

The sudden Valentine’s Day announcement resulted in a wide range of reactions from elected officials, organizations and activists both in support and opposition of the Amazon deal.

Elected Officials

Governor Andrew Cuomo stated “Amazon chose to come to New York because we are the capital of the world and the best place to do business. We competed in and won the most hotly contested national economic development competition in the United States, resulting in at least 25,000-40,000 good paying jobs for our state and nearly $30 billion dollars in new revenue to fund transit improvements, new housing, schools and countless other quality of life improvements. Bringing Amazon to New York diversified our economy away from real estate and Wall Street, further cementing our status as an emerging center for tech and was an extraordinary economic win not just for Queens and New York City, but for the entire region, from Long Island to Albany’s nanotech center.

However, a small group politicians put their own narrow political interests above their community — which poll after poll showed overwhelmingly supported bringing Amazon to Long Island City — the state’s economic future and the best interests of the people of this state. The New York State Senate has done tremendous damage. They should be held accountable for this lost economic opportunity. . .”

Mayor Bill de Blasio stated, “You have to be tough to make it in New York City. We gave Amazon the opportunity to be a good neighbor and do business in the greatest city in the world. Instead of working with the community, Amazon threw away that opportunity. We have the best talent in the world and every day we are growing a stronger and fairer economy for everyone. If Amazon can’t recognize what that’s worth, its competitors will.”

Later on that evening, Mayor de Blasio stated, “Look, New York City gave Amazon a real opportunity here and all we asked was that they’d be a good neighbor and be part of the community, and clearly they weren’t ready to do that. It’s very disappointing. There was no dialogue; there was no effort to work together. I don’t understand it, I really don’t. Yeah, we are a tough city, but they should have known that coming in and, you know, other people will take their place. . . The company had the power to make the decision, not the politicians. I think a lot of those politicians were mistaken. I think they did not value the jobs and they didn’t understand that constituents needed those jobs and we needed that revenue to keep being a city that really works to help people. But no – in the end, let’s be clear, Amazon had the power to make this decision.”

New York State Senate Republican Leader John J. Flanagan said, “I am extremely disappointed that Amazon has decided to pull out of New York and take 25,000 much-needed jobs and billions of dollars in new revenue with them. From the start, the Senate Democrats have politicized and poisoned this process just so they could avoid the wrath of the extreme left wing of their party.

New York City Council Minority Leader Steven Matteo stated, “There is no doubt that losing 25,000 well-paying jobs and potentially billions in tax revenue is going to hurt this city, especially as we approach a $100 billion budget and have incurred massive future financial obligations. In the meantime, my constituents will continue to be walloped by soaring property taxes, as city leaders fail to consider the consequences of high taxes and exorbitant spending.”

Other elected officials against the Amazon headquarter project also shared their reactions on Thursday.

U.S. Representative Alexandria Ocasio-Cortez tweeted, “Anything is possible: today was the day a group of dedicated, everyday New Yorkers & their neighbors defeated Amazon’s corporate greed, its worker exploitation, and the power of the richest man in the world.”

In a live press conference, State Senator Mike Gianaris stated, “What we witnessed today was the reason why Amazon was a bad partner for New York to begin with. Here is a company that has concentrated so much power that they think can dictate to states and cities what they’re allowed to tell their people, how much money of theirs they want to take to grace us with their presence and without any consideration to the communities that their presence would affect. The housing crisis that would have resulted from this, the ongoing problems with our subways, the lack of school space in Hunter’s point where this facility would have been located have been increasing in dimension for years. Amazon’s presence would have made that worse and yet there was no conversation about how the infrastructure of New York City would be able to handle amazon’s presence here. Well, the news for Amazon is that they’re not bigger than New York City, at least not yet. They may think that they get to dictate terms to governments but thankfully we’re not yet at that point.”

City Council Speaker Corey Johnson stated “I look forward to working with companies that understand that if you’re willing to engage with New Yorkers and work through challenging issues New York City is the world’s best place to do business. I hope this is the start of a conversation about vulture capitalism and where our tax dollars are best spent. I know I’d choose mass transit over helipads any day.”

Council Member Jimmy Van Bramer tweeted, “When our community fights together, anything is possible, even when we’re up against the biggest corporation in the world. I am proud that we fought for our values, which is a fight for working families, immigrants, & organized labor Defeating an anti-union corporation that mistreats workers and assists ICE in terrorizing immigrant communities is a victory. Defeating an unprecedented act of corporate welfare is a triumph that should change the way we do economic development deals in our city & state forever.”

Queens Borough President Melinda Katz, who originally supported the Amazon plan, stated “We all want jobs to come to Queens, and Amazon used the promise of job creation to extract major concessions for this project. But after last month’s City Council hearing, it became increasingly clear that they had no intentions of being good neighbors and committing to the required negotiations. They rejected our values of supporting working people and were unwilling to work with our local communities toward a mutually beneficial resolution. . .”

New York City Comptroller Scott M. Stringer criticized Mayor de Blasio on Twitter stating “. . . with all due respect, you made this deal in secret with no community input from LIC residents. While Amazon is no angel, they played by your rules. The early takeaway from this: don’t be afraid of transparency and community inclusion.”

Unions

Hector Figueroa, the President of 32BJ SEIU, stated “The news that Amazon has decided to cancel its plans to build its second headquarters in New York City is a disappointing development for working people in our city. This is a lost opportunity for Queens and New York on many levels. Of course, the loss of 25,000 direct jobs and many more indirect ones as well as the billions in revenue that the project was expected to bring into our city is unfortunate. For labor however, this is also a missed opportunity to engage one of the largest companies in the worl and to create a pathway to union representation for one of the largest groups of predominantly non-union workers in our country.”

Gary LaBarbera, President of the Building and Construction Trades Council of Greater New York stated, “We are stunned by today’s unfortunate news. Politics and pandering have won out over a once-in-a-generation investment in New York City’s economy, bringing with it tens of thousands of solid middle class jobs. This sends the wrong message to businesses all over the world looking to call New York home. Who will want to come now? We will remember which legislators forgot about us and this opportunity.”

George Miranda, President of Teamsters Joint Council 16, stated, “New Yorkers made it clear that Amazon wasn’t welcome in our city if it would not respect our workers and our communities. Apparently, the company decided that was too much to ask. We are committed to fighting for the rights of workers throughout the Amazon supply chain and supporting their demand for a voice on the job.”

Chelsea Connor, Director of Communications for the Retail, Wholesale and Department Store Union stated, “Rather than addressing the legitimate concerns that have been raised by many New Yorkers, Amazon says you do it our way or not at all, we will not even consider the concerns of New Yorkers – that’s not what a responsible business would do

Other Organizations and Activists

Community organizations and activists who actively opposed the headquarters shared their reaction to the news as well.

Jonathan Westin, Executive Director of New York Communities for Change, stated “Bye Jeff and good riddance! Make no mistake: strong, effective community organizing is what defeated Amazon’s $3 billion backroom deal. Many low-income New Yorkers of color and immigrant New Yorkers came together to build a movement against the HQ2 deal.  From day one, Amazon, Governor Cuomo, and Mayor de Blasio completely underestimated the diversity and intensity of the opposition to this awful deal. Countless New Yorkers saw what Bezos, Cuomo and de Blasio refused to see: Amazon’s expanded corporate presence in Long Island City, Queens would do far more harm than good. Amazon’s mistreatment of workers, close ties to ICE, and harmful role in accelerating gentrification and displacement were never going to be accepted or embraced in communities most impacted by the HQ2 deal.”

Make the Road NY, another advocacy group that protested against the headquarters, tweeted, “HUGE victory for our community. People power wins, even against the richest man! #NoAmazonNYC” and thanked other advocacy groups who also protested.

Other organizations expressed their disappointment and sadness over the loss of the deal.

Tom Grech, the President and CEO of the Queens Chamber of Commerce stated “No words at this moment can convey the sadness and dismay at the loss of this historic opportunity…. I’ve never been involved with a more professional, diligent and transparent bunch of individuals than the Community Advisory Committee (CAC). An entire generation will look back at the these last few months and ask us why. I hope those that opposed this Amazon deal have the answers to what we lost today.”

John H. Banks, President of the Real Estate Board of New York stated, “New York’s renaissance over the past forty years has been due in part to our ability to work through difficult issues that have led to record population and job growth and the emergence of our city as a true global capital. It’s unfortunate that we have lost out on an opportunity to create tens of thousands of jobs for city residents and generate billions of dollars in tax revenue to fund vital services including infrastructure improvements for transportation, schools, and open space. Nevertheless, New York City is still open for business and will retain its status as a world class center for tech and innovation.”

In its blog post, Amazon thanked Governor Cuomo and Mayor de Blasio for their support and efforts and stated that the company did “not intend to reopen the HQ2 search at this time” but would proceed with the headquarter expansion plans for Northern Virginia and Nashville.

 

By: Veronica Rose (Veronica is the CityLaw Fellow and a New York Law School Graduate, Class of 2018.)