The Washington region won three spots on Amazon’s list to host its second headquarters and the accompanying 50,000 jobs on Thursday when the online retail giant included the District, Northern Virginia and Montgomery County on its shortlist of 20 possible locations.
Washington was the only metropolitan area in the continent-wide competition with three locations to make the initial cut. That success prompted elected officials and business leaders to crow that the region has improved its attractiveness as a place to do business, even as the three jurisdictions prepared to battle among themselves and with 17 other contenders to win the ultimate prize.
“It speaks well of the workforce in our region and how people feel about living here,” said D.C. Mayor Muriel E. Bowser (D). “Making this list reaffirms [that] . . . Washington, D.C., is no longer a one-company government town.”
But the announcement also stirred concerns in some communities that a huge influx of workers would worsen traffic congestion, burden school systems and drive up housing prices.
Additionally, it disappointed numerous jurisdictions that failed to advance. Those included Prince George’s County and Baltimore in Maryland, and Richmond and Hampton Roads in Virginia.
Gerald Gordon, who as president of the Fairfax County Economic Development Authority is eager to win the Amazon headquarters, said the estimated 50,000 employees arriving over time would generate economic activity that would create an additional 150,000 to 200,000 jobs.
“Companies are going to want to site themselves around Amazon, and they’re going to spin off [more jobs], and then you have families. Ultimately you’re talking about more than a million people,” Gordon said. “Clearly what’s going to have to take place, no matter where they go, is infrastructure improvement. It may not just be transportation, but also sewer and water and other things.”
Local governments have made public few details about the specific locations and financial incentives they have offered to Amazon, citing the need to preserve confidentiality for competitive reasons.
But Maryland Gov. Larry Hogan (R) signaled that may change. His office responded to the announcement by saying the state’s incentive package to lure Amazon totaled more than $5 billion. The offer included tax incentives and transportation improvements.
The Northern Virginia package included incentives from state and local governments, including economic development and job training grants, tax abatements and transportation improvements.
The District, which also has offered tax incentives, has proposed four sites. One envisions properties on both sides of the Anacostia River, many of them near Nationals Park and the new D.C. United stadium. Another suggests centering Amazon’s headquarters in the NoMa community and the area behind Union Station. The other proposals would center the headquarters in the Capital Hill East neighborhood or in the Shaw-Howard University area.
Maryland’s Montgomery County has offered two sites, one of which is said to be White Flint. Northern Virginia has offered at least five sites, not all of which have state support. One is a joint bid by Fairfax and Loudoun counties for a location next to Dulles International Airport occupied by the Center for Innovative Technology. Another is a joint bid by Arlington and Alexandria for a site in the Crystal City/Potomac Yard area.
The national competition is expected to intensify in the next round as Amazon executives visit sites and hear more detailed pitches from the contending jurisdictions. Other candidates on Amazon’s list include major metropolitan areas such as Philadelphia, Los Angeles and Dallas and smaller cities such as Pittsburgh, Raleigh and Nashville.
New York was the only metropolitan area other than Washington with more than one location on the list of 20, with New York and Newark making the cut.
Local officials and business executives acknowledged that the region has vulnerabilities in the national contest. They include a history of infighting among the area’s jurisdictions — highlighted by the difficulty in agreeing on how to fund Metro — and high housing prices.
But the Washington region did well in the initial round because of the allure of its well-educated workforce, its cultural diversity and its proximity to the federal government and three airports, officials said. It also benefited from an East Coast location that would complement Amazon’s main headquarters in Seattle.
The inclusion of Montgomery County on the list of 20 was especially welcome there and in Maryland, allaying the acute disappointment experienced last week when Discovery Communications announced it was moving its headquarters from Silver Spring to New York.
But the announcement also put Hogan in the awkward position of welcoming the good news for Montgomery even though he had spoken out strongly in favor of luring Amazon to Baltimore’s Port Covington neighborhood.
“I was really pushing for the Port Covington site because I think Baltimore needed the help more than anybody else did,” Hogan said. “But we’re thrilled that Maryland is on that shortlist to potentially receive 50,000 jobs and we’re going to do everything we can to make sure that happens.”
Several officials said the confirmation of Amazon’s interest in coming to the Washington area elevated the importance of obtaining more funding for the Metro system in the current legislative sessions in Virginia and Maryland. A strong public transit system was one of Amazon’s main criteria for selecting a site, and a regional agreement on Metro would ease concerns about lack of cooperation among the area’s jurisdictions.
“I hope this does deliver a message to elected leaders across the region that we have to get this funding mechanism fixed,” said Jim Corcoran, who is president of the Northern Virginia Chamber of Commerce and represents Virginia on the Metro board. “It certainly increases the urgency for acting now.”
Amazon has said it is seeking an international hub with strong educational institutions and high quality of life for its $5 billion project, known as HQ2. (Amazon’s chief executive, Jeffrey P. Bezos, owns The Washington Post.)
The announcement raised questions about the influence of large tech giants on cities and the possible unintended consequences of giving tax breaks and other benefits to an already successful corporate titan.
Amazon declined to say when the company would make a final decision. Gordon, the Fairfax official, said he expected the list of 20 would be whittled to a smaller group of contenders by July.
By coincidence, the Amazon news broke Thursday morning while Gordon and three other top local economic development officials were taking part in a panel discussion at a regional economic conference in Falls Church.
All four officials — from Fairfax, Montgomery, Arlington and the District — immediately began stressing how the entire region would benefit from Amazon’s arrival, no matter which location won. But they acknowledged that each hoped to best the others, because the winning jurisdiction would get extra tax revenue and the prestige associated with Amazon.
“If Amazon goes anywhere in our region, we all win, whether that’s [tax revenue for] schools, office space or hotels,” said Brian Kenner, D.C.’s deputy mayor for planning and economic development.
But he added, “All of us get paid by taxpayer dollars or government dollars from people who ask, ‘What are you doing for me?’ ”
The District, in its pitch to Amazon, offered incentives through an existing program that gives qualified technology companies breaks on income, property and sales tax. The exemption provides a zero percent corporate tax rate for five years and a reduction in the corporate tax rate from 9 percent to 6 percent for the life of the company.
The District did not initially release the details about the incentives it provided Amazon; they were obtained through a an open-records request by WAMU-FM.
No matter which place wins the headquarters, all agreed that much is at stake.
“It’s not often you get a true game-changer,” said Fairfax Supervisor Pat Herrity (R-Springfield.) “Discovery is a blip. This is a game-changer.”
Ovetta Wiggins contributed to this report