Amazon HQ Move Criticized by New York City Council, U.S. Senator

Henry Goldman
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Amazon HQ Move Criticized by New York City Council, U.S. Senator

(Bloomberg) -- New York Mayor Bill de Blasio and Governor Andrew Cuomo were all smiles Tuesday when they announced that Amazon.com Inc. will bring a new headquarters to the city with thousands of jobs and billions of dollars in investment. But a local backlash threatens to spur investigations into how the deal got done and whether it will benefit the city.

About 250 people huddled against the cold wind in Long Island City Wednesday, near the East River site where Amazon plans to move in. Instead of cheering, they were there to express outrage over the deal, which included a non-disclosure agreement that kept much of the details secret. Despite the influx of investment and jobs, some economists and policy makers have warned that the giant project will raise housing costs, displacing residents, and increase already snarled traffic. U.S. Senator Kirsten Gillibrand later used a Twitter posting to join the chorus of critics.

The gathering in Queens included dozens of elected officials, including City Councilman Jimmy Van Bramer, who represents the district that includes Long Island City and who said he’d been shut out of any negotiations and only learned the deal had been consummated by reading about it in the newspaper. Part of the deal involves a state takeover of land involved so that the City Council would have no zoning oversight.

“What we’ve seen here is a process that no American city should have to endure,” Van Bramer said in an interview before the rally. “A governor and a mayor who claim to be progressive Democrats throwing nearly $3 billion at the richest man in the world and then promising a secretive grease-the-wheels process that avoids ‘messy’ public votes and hearings that might muck up the works.”

Now, a cadre of lawmakers is scrutinizing the transaction and the roles of the mayor and the governor in it, Van Bramer said. He vowed investigations at every level of government and said City Council lawyers are developing litigation strategies.

“We’re looking at any and all ways in which we can reassert the city’s and the people’s process here,” Van Bramer said. “It can not be that the mayor and governor and Jeff Bezos -- literally three men in a room -- can conspire to give him $3 billion and a helicopter pad, because who wants to struggle taking the subway? That can not be.”

Van Bramer and other public officials said they wanted the deal reopened to wrest commitments from Amazon to make specific pledges to help pay for improvements to mass transit, schools, parks, streets and new sewer lines. Amazon is opening a similar site in Arlington, Virginia.

Gillibrand, a Democrat who represents New York in the Senate, criticized the incentives used to lure Amazon and faulted what she called a “lack of community input” in the decision-making process.

In announcing Amazon’s intention to come to New York, Cuomo predicted the company would hire 40,000 workers within 25 years, instead of the 25,000 jobs Amazon has promised in the next 10 years. If that happened, Cuomo said, the city and state would have paid $3 billion in tax abatements and other incentives to reap as much as $27.5 billion in tax revenue from Amazon over the 25-year cycle.

“Complete malarkey,” countered state Senator Michael Gianaris, who represents the area and joined Van Bramer to host the Wednesday rally. He said Cuomo’s calculations of tax revenue were based on a comparison as if the site would remain an empty parcel, when in fact, the site had already been planned for development that would have been subjected to land-use review. The senator drew cheers from the crowd when he said he would boycott Amazon unless the deal is rescinded.

The mayor, who decried income inequality in winning control of City Hall in 2013, mused that the company’s location near Queensbridge Homes, the largest public housing complex in the U.S., would create a “synergy” of opportunity, without providing details as to how that might be accomplished.

Judging from the reaction of progressive activists, including U.S. Representative-Elect Alexandria Ocasio-Cortez, who have denounced the agreement, de Blasio’s lead role in bringing the company here may hurt the mayor with the base of progressive Democrats he has sought to lead.

When asked about the criticism, De Blasio’s office referred to comments he made Tuesday. The mayor said he measured success by “how many everyday people benefit.” Cuomo, in justifying the deal Tuesday, said New York’s incentive offer was lower than many cities and states, including Newark, which had promised benefits worth $7 billion.

(Updates with Gillibrand’s comments in the eighth paragraph.)

To contact the reporter on this story: Henry Goldman in New York at hgoldman@bloomberg.net

To contact the editors responsible for this story: Flynn McRoberts at fmcroberts1@bloomberg.net, ;Tom Giles at tgiles5@bloomberg.net, Molly Schuetz, Andrew Pollack

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