Amazon.com Inc. executives said Wednesday the company zeroed in on New York City as a site for its second headquarters because of its deep talent pool, but the potential $3 billion in tax incentives and grants from the state and city sealed the deal.
They made the statement during a highly anticipated City Council hearing about the closed-door negotiations between the tech giant and officials that got it to agree to build a future campus in Long Island City, Queens.
“Incentives were certainly a part of that process, and they were a priority for us,” Holly Sullivan, Amazon’s head of worldwide economic development, told council members as they questioned her and Brian Huseman, the company’s vice president of public policy.
The hearing was the first of three council hearings about the agreement, which has drawn heavy criticism from residents and local politicians over its lack of transparency and the muting of public input. Under the deal, the Long Island City campus will skip the process known as the “uniform land-use review procedure” and will instead go through a “general project plan,” which overrides the usual local approval hearings and votes.
“We have a lot of questions, which is why we are here today,” City Council Speaker Corey Johnson, a Democrat, said during the hearing. “Tough questions that should’ve been asked at the start, tough questions that the public has a right to hear answers on.”
Hundreds of people attended the hourslong questioning of the Amazon executives and James Patchett, president and chief executive of the city’s Economic Development Corp. Some protesters interrupted it at times with chants, and they also hung an anti-Amazon banner from the balcony of the council chambers at the start of the hearing.
The exchanges between the council members, Amazon officials and Mr. Patchett were at times heated and acrimonious.
Council members focused on HQ2’s impact on infrastructure, transportation and housing prices; on the nondisclosure agreements signed by the city and the state; and on the billions in incentives promised to Amazon.
The company will receive up to $3 billion in city and state incentives — with $1.2 billion contingent on creating at least 25,000 jobs over the next decade — and millions in property-tax abatements and tax credits for each employee. Amazon plans to bring 700 jobs to Long Island City by 2019.
The Amazon representatives highlighted the economic benefit of HQ2, which will be split between Long Island City and a site in Arlington, Va. The locations were announced in November. Amazon also plans to bring 25,000 jobs to the Arlington campus over roughly 10 years. The company is expected to bring 400 jobs to that location in 2019.
Mr. Huseman said told the City Council that Amazon is committed to hiring locally and had invested an initial $5 million in workforce training in Queens. City and state officials announced Tuesday the creation of a 45-member community advisory group that will meet to provide input and share information about HQ2.
Mr. Patchett said the economic benefit to the city was worth the subsidies, which already existed in the neighborhood and are available to any other company.
With a guarantee of at least 25,000 jobs, HQ2 is expected to deliver a direct financial advantage of more than $27 billion, he said.
Citing recessions throughout the city’s history, he said it was his job to ensure the local economy remained strong.
“We have a commitment that will bring tens of thousands of new opportunities in a range of fields, from tech, legal and advertising to administrative and custodial,” Mr. Patchett said.
The HQ2 plan would help turn Long Island City into the business district that was envisioned for the neighborhood after a 2001 rezoning but never truly materialized, he said.
Councilman Jimmy Van Bramer, a Democrat who represents Long Island City, criticized Mayor Bill de Blasio for pushing the plan, saying it didn’t fit in with the mayor’s vow to end the “tale of two cities” that represents inequality in New York City.
Last year, Mr. Van Bramer signed letters of support for the city’s Amazon bid but said at the hearing that he had been wrong to do so.
“This is a bad deal for Long Island City, bad for Queens and bad for New York City,” he said.
Separately at a news conference Wednesday, Mr. de Blasio said he felt most New Yorkers were excited about the arrival of thousands of Amazon jobs. “What everyday people want and need is not always what elected officials and activists focus on,” he said.
The City Council will hold its second hearing on Amazon in January.
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