Public interest is running high over details of Colorado’s bid for a second Amazon headquarters — such as which locations the state recommended and how much it offered in taxpayer-funded financial incentives. But officials involved in crafting the proposal, without a hint of irony, say releasing that information is not in the public interest.
The state released a copy of its bid this week with those key details blurred out. In selected emails and documents related to the bid that the state provided to The Denver Post and Denver7 in response to a public-records request, specifics on locations and incentives were redacted.
“We think that it all should be public,” said Greg LeRoy, executive director of Good Jobs First, a national policy resource center for corporate and government accountability that has criticized public incentives. “In our opinion, because Amazon is running this like a public auction, everything about it should be public.”
Elsewhere in North America, major cities from Chicago to Philadelphia to Washington, D.C., spilled details of their quests to get Amazon to pick them. Massachusetts published its proposal online, mentioning more than $410 million in tax credits and infrastructure improvements is available for major employers considering moving to the state.
Washington, D.C., which called its campaign #Obviously D.C., also posted its proposal online. While it offered no specifics on its “generous tax incentives,” the nation’s capital named four locations and showed multiple properties available.
“We shared those locations publicly to showcase the people who live and work in our neighborhoods and to enlist them as partners in our bid,” said Chanda Washington, a spokeswoman for the DC Office of Deputy Mayor for Planning and Economic Development. “Because, in the end, it is the spirit of Washingtonians that gives the DC proposal its heart and soul.”
In putting its proposal together, Colorado relied on the private Metro Denver Economic Development Corp., which is part of the Denver Metro Chamber of Commerce. In doing so, certain documents weren’t made public in The Post’s open-records request while others were redacted. Messages between state economic development staff and others that were shared showed a massive and quick collaboration between public officials, educators and private companies.
In its response, the state said details were withheld because they were part of the “deliberative process privilege” or considered “confidential commercial information” that is exempt under the Colorado Open Records Act.
That “privilege” is probably because the state feels that revealing incentives or sites would affect its Amazon bid, said Jeff Roberts, executive director of the Colorado Freedom of Information Coalition.
“If the public is going to put up tax dollars to incentivize Amazon to come here, isn’t that in the public interest? That’s the way I’d look at it. There are other governments that are set up in the same way, as a private economic development. But they’ve decided that it’s OK to put this out,” Roberts said. “Why is it in the public interest in other states but not in Colorado? … What’s going to happen to housing (near the sites)? Or traffic? Of course it’s in the public interest.”
Metro Denver CEO J.J. Ament said that the sites were left out because the state “wants to protect the client’s ability to negotiate” with landowners. The state’s economic development team typically keeps locations and companies confidential using a series of code names when discussing incentives.
“We don’t want to do anything to jeopardize the company, in this case Amazon but any company, we don’t want to jeopardize their ability to execute their strategy in our state in a successful way. It’s important for that part of the process to remain confidential and proprietary about actual locations and real estate negotiations,” he said.
Very few people even know what the state offered. While hundreds participated, fewer than 10 saw the final proposal, said Sam Bailey, Metro Denver EDC’s vice president.
Officials have said details of the bid won’t be forthcoming even after Amazon makes its selection, which could come early next year.
Chamber CEO Kelly Brough said in a letter to board members that release of details is not in the public interest.
“Releasing confidential and proprietary information contained in the actual proposal impairs our ability to compete with other locations, puts in jeopardy Amazon’s ability to execute their own strategy if Colorado is selected, and is not in the public interest. We never release confidential and proprietary information, and Amazon is being treated no differently than we treat any company working with us,” she wrote.
The highly public way Amazon announced its search for a second headquarters by posting criteria on its site had cities and states scrambling for attention. Some made their offers very public, including New Jersey and its $7 billion in potential credits.
“The old game is you’re not supposed to ask about competing bids. You’re just supposed to be quiet and put as much cash on the table as possible,” LeRoy said. “The old rules should not apply. Otherwise, Amazon gets it both ways. They get a winner and they get to keep all that meaningful paperwork confidential.”
LeRoy cautioned that with the lack of transparency, the public won’t know when state officials are offering more than the regular law-abiding incentives, such as passing new legislation that benefits a company. Or whether any of the select land sites were picked because of political connections.
He pointed to the example of the state of Michigan, which passed legislation in July to encourage job creation by allowing certain businesses to keep a portion of the income tax generated by their employees. That wasn’t enough for Michigan to beat out Wisconsin to attract a Foxconn Technology Group manufacturing plant, even with an incentive offer of $3.8 billion.
In the Colorado proposal, Amazon could qualify for job growth and performance incentives exceeding $100 million, officials have said, but a few other offerings could boost that number much higher. Each community with a location “has developed a custom incentive package … to support the build out of Amazon HQ2,” reads page 49 of the proposal.
Former Colorado Gov. Richard Lamm, who has argued against taxpayers footing the bill for corporate mega-deals, said Amazon is playing cities against each other and will profit mightily from the competition. That said, he noted he’s not against all incentives, like modest job training amounts.
“In Amazon’s case, with our low unemployment rate, large numbers of people will be recruited,” he said. “It costs state and local government between $25,000 and $35,000 per relocated family. Sewer rates go up. Water rates go up. Streets, schools, etc., are expensive. Even if the state offered no incentives, Denver would have substantial expense in this relocation.”
