Dive Brief:
- A nonprofit government watchdog group has filed a lawsuit against Chicago Mayor Rahm Emanuel and the city in order to compel them to reveal details about the Windy City's bid to win Amazon's new $5 billion North American headquarters (HQ2), according to the Chicago Business Journal.
- Lucy Parsons Lab said on Thursday that it filed the legal action under the Freedom of Information Act in order to find out whether Chicago taxpayers would be left on the hook for whatever incentives the city offered up to Amazon. City officials have said that they put together a $2 billion incentive package for the internet retail giant.
- Amazon recently selected 20 cities as finalists from the 238 proposals it received. Amazon has reportedly required all finalists to sign nondisclosure agreements that would keep them from revealing specifics about the company's HQ2 selection process.
Dive Insight:
In October, Anderson Economic Group (AEG) ranked Chicago second only to New York City as the most likely winner of the HQ2 bid. Chicago beat New York City as far as the cost of doing business, but AEG said New York City earned the top spot because of access to transportation systems, a qualified labor supply, customers and a robust supply chain.
While Chicago is offering billions in incentives to Amazon to entice the company to relocate to the Windy City, it's certainly not the only bidder to do so. After Amazon whittled down its list to 20 finalists, it was revealed that New Jersey had offered the company a $7 billion incentive package. The next most expensive packages were from Irvine, California ($5 billion) and Philadelphia (up to $3 billion). According to the Institute for Local Self-Reliance, Amazon previously received more than $600 million in tax breaks to build warehouses in various locations and $147 million to construct data centers.
This is typical, however, when state and local governments want to lure big business — and the benefits they bring — to their locales. Most recently, as part of luring Nikola Motor Co. and its new $1 billion truck manufacturing plant to the state, Arizona said it was doling out up to more than $46 million in tax incentives and job training funds to the company as long as it made the expected investments and started hiring employees. The plant will be built in the city of Buckeye, and the municipality is giving the firm an extra layer of incentives – a 49% sales tax rebate.
