Amazon - Going... Going... Gone.

The recent move by Amazon to withdraw from its proposed headquarters in Long Island City raises many issues. The arguments proffered by the opponents of the Amazon sight in Long Island City were based on the size of the subsidy offered, nearly $3 billion, and the bypassing of typical land use approval processes. An overarching and larger theme advanced by progressives was to halt perceived corporate welfare. Caught up in these arguments, Amazon withdrew its move to Long Island City and the potential of 25,000 high-paying jobs evaporated.

There is no doubt that economic development programs in New York State need reform. As noted in the Citizens Budget Commission’s report : 10 Billion Reasons to Rethink Economic Development in New York, the State spent $9.9 billion on state and local economic development efforts in 2018, up $1.4 billion and 17 percent from $8.5 billion in 2016. Past programs have fallen short in achieving the stated benefits and have lacked transparency. A database of deals and procurement reform were included in the Governor’s book of proposals released with the State of the State, and the 2020 Executive Budget includes an appropriation to fund the creation of a database. However, these proposals are not included in the Article VII bills accompanying the Executive Budget, so they would not have the strength of law. These reforms should be codified in statute and passed by the legislature in this session.

While economic development reforms are needed, the question remains as to whether Amazon was the appropriate battleground. Establishing a headquarters would have further fueled the renaissance already taking place in Long Island City and a development of that magnitude would undoubtedly generate significant tax revenue (estimated at $27.5 billion in state and city revenue over 25 years). It was a rare opportunity that may not come again soon.