NYC Lawmakers Vent Rage at Amazon Over Secret Negotiations
(Bloomberg) -- New York City Council members denounced Amazon.com Inc. executives and a city economic development official over its deal that will provide the company with $3 billion of incentives for building a satellite headquarters in Long Island City.
“We have a crumbling subway system, record homelessness, public housing that is a national embarrassment, overcrowded schools, sick people without health insurance and an escalating affordable housing crisis,” said City Council Speaker Corey Johnson, a Manhattan Democrat. “Is anyone asking if we should be giving nearly $3 billion in public money to the world’s richest company -– valued at $1 trillion dollars -– instead of focusing on any of those problems?”
The council has few, if any, tools to block the deal, although lawyers for the legislative body may file a lawsuit to challenge the authority of the mayor and governor and slow the project’s process, according to Johnson and Jimmy Van Bramer, the council member who represents the area.
Yet a $505 million state grant that’s part of the Amazon subsidy package may require unanimous approval of the state’s five-member Public Authorities Control Board, which oversees many capital spending projects. A probable member of that panel next year, Democratic state Senator Michael Gianaris of Queens, is one of the deal’s harshest critics. Governor Andrew Cuomo says the deal isn’t contingent on the board’s approval. The issue may wind up in court.
Council members are considering a law that would bar city officials from negotiating non-disclosure agreements with companies that receive public funds as incentives to locate in the city. James Patchett, president of the city’s Economic Development Corp., said the administration of Mayor Bill de Blasio would oppose it.
“Non-disclosure agreements are necessary under certain circumstances,” Patchett said. “We feel very good about the deal we made to get the 25,000 jobs here.”
Patchett said the deal hinged on bypassing local land-use review by the City Council, through a state law creating a “general project plan,” because of its complexity and public importance, consistent with past projects to redevelop Times Square or create a park near the Brooklyn Bridge. The arrangement allows for payments instead of property taxes to be dedicated to the neighborhood, Patchett said.
Johnson asked whether the company needed the incentives.
Amazon Vice President for Public Policy Brian Huseman said “talent was the key driver but incentives were also a factor. Our project is going to have a positive economic impact and we’re only going to receive these incentives after we create these jobs and make these investments.”
Huseman said the company would solicit neighborhood participation to determine how best it could provide jobs, infrastructure funding and other needs to Long Island City. He offered few specifics, though he did say Amazon would spend $5 million on job-training and efforts to seek workers from four nearby public-housing developments.
“We want to be a good neighbor,” Huseman said, vowing to “make community investments to benefit the residents.”
Johnson questioned the company’s policies toward union organizing, igniting jeers from spectators in the council gallery, of whom dozens were workers at an Amazon warehouse seeking union representation. Amazon has agreed to use union workers to build out its campus.
“Amazon workers are under attack, what do we do stand up fight back,” the group chanted, silenced by Johnson’s threat to have police eject them from the hearing.
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