Amazon ditches New York headquarters

Several members of the Senate and Assembly voiced skepticism about the state and city incentives that initially convinced Amazon to choose Long Island City.

Posted: Feb 14, 2019 2:59 PM
Updated: Feb 14, 2019 3:17 PM

NEW YORK (AP) - Amazon's stunning announcement to abandon its proposed campus in Long Island City came just two days after the Cuomo administration's economic development czar repeatedly praised the deal during his three hours of testimony before a joint legislative hearing in Albany on the governor's $175 billion state budget proposal.

Several members of the Senate and Assembly voiced skepticism about the state and city incentives that initially convinced Amazon to choose Long Island City, questioning economic development Commissioner Howard Zemsky about its cost for taxpayers. He responded by focusing on the number jobs and the billions in tax revenues the project was expected to generate over the next two decades.

"There's nothing we can equate this to in the history of the state," Zemsky said Tuesday. "It's the largest economic development prize we've ever had."

Amazon's decision to cancel its planned headquarters in Long Island City reflects poor planning by both the company and state leaders, a leading business location consultant said.

Tom Stringer, managing director at BDO Consulting, said that neither the company nor the state reached out sufficiently to neighborhood leaders to win them over.

"Both of them really did an awful job," Stringer said. Not having local officials "in the process early on is really mind-boggling to me."

The collapse of the deal won't hurt the city's economy, Stringer said, because it is already doing well and the project hadn't moved forward yet. But it damages New York City's reputation for getting deals done, he added.

On the streets of Queens, reaction to Amazon's decision to cancel its headquarters differed among the residents and local businesses.

Andrew Ousley, a resident of one of the new rental high-rises near the site Amazon had considered, applauded Thursday's news.

"I was afraid that having Amazon in our backyard was going to lead to rent hikes and increased prices in stores and restaurants," he said. "Given I both live and operate my business out of LIC, my plan was to move out before they arrived. But now that they're not coming, I'm more likely to stay and see how the neighborhood continues to grow and evolve in a more organic fashion."

But Tom Grech, president and CEO of the Queens Chamber of Commerce, struggled to express his "sadness and dismay."

"An entire generation will look back at these last few months and ask us why," he said in a statement. "I hope those that opposed this Amazon deal have the answers to what we lost today. Queens is one of the best places for a tech firm - for any forward-looking business - to expand into, with our diverse talent pool, entrepreneurial spirit, thriving arts scene and boundless energy. It is a shame to lose the opportunity, investment and jobs that Amazon offered, but there are many more ways for businesses in Queens to thrive, and we will be welcoming them with open arms."

Mayor Bill de Blasio issued an upbeat statement on Amazon's decision, noting that New York City will thrive no matter what.

"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," the mayor said. "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."

Meanwhile, Governor Andrew Cuomo, who had championed Amazon's plan, had yet to comment on the decision.

An indication that Cuomo was growing concerned over opposition to the Amazon deal and reports of the company having second thoughts was evident in comments he made during an interview Tuesday with a New York City radio station.

"I don't think they're bluffing. I think this is very serious," he then said.

The billions of dollars in tax incentives that Amazon was awarded stirred backlash from a number of activists.

Deborah Axt, the co-executive director of anti-poverty group Make the Road New York, called Amazon's withdrawal a "landmark victory."

"This announcement ... shows the power of the people, even when taking on the world's richest man," Axt said. "Our members and allies stood firm against Governor Cuomo's plan to give away more than $3 billion in taxpayer giveaways so that Amazon could force its empire-building on our neighborhoods.

Copyright 2019 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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