The Washington PostDemocracy Dies in Darkness

Noisy, decisive showdown foreseen for Arlington County Board meeting on Amazon

Viewed through a bus stop, pedestrians walk along Crystal Drive in Crystal City. The Arlington County Board expects to vote soon on $23 million in subsidies for Amazon’s second headquarters.
Viewed through a bus stop, pedestrians walk along Crystal Drive in Crystal City. The Arlington County Board expects to vote soon on $23 million in subsidies for Amazon’s second headquarters. (Matt McClain/The Washington Post)
Placeholder while article actions load

An earlier version of this story incorrectly reported that Aldi has headquarters in Arlington. This story has been updated.

An Arlington County Board meeting about Amazon’s new second headquarters this Saturday is shaping up as a potentially decisive showdown between opponents of the project and board members who support it.

Support for the headquarters in Crystal City appears sufficiently strong on the five-member panel that the main group fighting the project concedes it cannot persuade the board at this time to reject a proposed $23 million incentives package for the online retail giant. (Amazon founder and CEO Jeffrey P. Bezos owns The Washington Post.)

Instead, the “For Us, Not Amazon” coalition hopes to turn out enough critics to convince the board to delay Saturday’s vote so that additional meetings can be held to examine the proposal, its leaders said.

“What we’re expecting is community members to mobilize in big numbers, and to express concerns and ask questions,” said Danny Cendejas, an organizer with the coalition. “We hope they will delay this vote.”

Board Chair Christian Dorsey (D) said he has “no interest” in postponing the vote and has heard no suggestions to do so from other board members. He expects the measure to pass, but he also said anywhere from 100 to 400 speakers could show up for the public hearing before the vote.

Here’s what Amazon has to do to get $23 million from Arlington County.

The board vote affects only a fraction of the total benefits that Amazon will receive, or could be eligible to receive, for picking Arlington as the site for its second North American headquarters and at least 25,000 jobs paying annual salaries of at least $150,000.

The Virginia General Assembly has already approved up to $750 million in grants for Amazon — 32 times more than the proposed cash subsidies from Arlington — with minimal debate.

But the vote is politically significant because it appears to offer the only opportunity in the state for activists who oppose Amazon to try to block, or at least slow, the project. In addition to opposing taxpayer subsidies for a wealthy corporation, the critics are concerned that the influx of Amazon workers will displace low-income residents.

The generally positive response in Virginia has contrasted with that of New York, where opposition from grass-roots activists and local politicians led Amazon to cancel plans to build a headquarters facility with 25,000 employees in the Long Island City neighborhood of Queens.

Amazon declined to comment for this story.

Arlington board members have met with community groups in recent weeks to describe what they see as the project’s benefits. They say that even after accounting for the cost of the subsidy, the deal will generate net increased tax revenue for Arlington of $32 million a year.

Amazon seeks ‘good neighbor’ image in Arlington, but opponents aren’t impressed.

Board member Erik Gutshall (D) told a meeting of the Arlington County Civic Federation last week that the project was “an overwhelming win” for the county. He said only “a relatively small group of folks” oppose it.

Last week, critics sought to rally support by accusing county officials of failing to adequately inform the public that Amazon could be eligible for a county program that offers some technology companies a significant break on their annual business license taxes.

The potential tax benefit — and the county’s promotion of it in a marketing proposal used to lure Amazon to Arlington — were highlighted in an article published Wednesday on the local news website ARLnow.

The program allows for certain operations of technology companies to receive a reduction of up to 72 percent in the Business, Professional and Occupational License tax for up to 10 years. The break could save Amazon millions of dollars — an incentive that critics view as galling for a corporate behemoth that reportedly paid no federal taxes on $11.2 billion in profits last year.

Greg LeRoy, executive director of Good Jobs First, which tracks corporate subsidies, faulted Arlington for doing too little to publicize the potential incentive.

“This should have been announced on Day One,” LeRoy said.

Amazon’s New York ‘disaster’ reminds leaders to address gentrification.

Arlington County officials pushed back, saying that Amazon was not receiving any special favors. They said the tax break is available to any qualified technology company.

“We’re really treating Amazon, as hard as it is to believe, basically like any other business,” Board Vice Chair Libby Garvey (D) said on WAMU 88.5 radio Friday.

Other county officials said they had not called attention to the potential tax break because the Amazon facility, as a headquarters campus, might engage only in businesses that are not liable to pay the license tax. That’s been the case with other companies’ headquarters offices in Arlington, such as those of Nestle and Lidl, according to Victor Hoskins, director of Arlington Economic Development.

Paying business license taxes “just hasn’t been the case for large global companies,” Hoskins said.

As a result, he said, Arlington has not included any proceeds from the business license tax in its projections of how much the county will gain from Amazon’s arrival. In the county’s view, any such tax revenue would be a windfall, even if Amazon paid at a lower rate.

“We didn’t know precisely what it’s going to be, so we didn’t want to make the projections,” Hoskins said. “Given our previous experiences [with headquarters facilities], that’s probably a good thing.”

The main board vote scheduled for Saturday is on the cash subsidies package for Amazon. The money would be drawn from a projected increase in revenue from the Transient Occupancy Tax, generated by the thousands of additional hotel stays anticipated with Amazon’s arrival.

Amazon would get 15 percent of the increased hotel tax revenue, which is projected to be $23 million over 15 years. The county would get the remaining 85 percent, projected to be $130 million.

The board is also scheduled to vote on a measure that would ensure that a portion of new property tax revenue generated by Amazon — and already slated for public infrastructure — would be spent in the neighborhood adjacent to the Amazon site. The projected total of such “tax increment financing,” is $28 million over 10 years. The money would pay for amenities such as parks and wider sidewalks.

The measure also gives Amazon a voice in deciding what is built, although the board would ultimately make the call.

LeRoy, the subsidies watchdog, called it “gold-plating the public amenities around a small number of private properties.”

But Hoskins, the county’s economic development chief, countered that it’s “helping all the businesses in Crystal City. . . . It’s not just for Amazon.”

Roshan Abraham, one of the leaders of the opposition coalition, said Saturday’s meeting will be “a moment of truth” for board members. “That’s where we see who are their true constituents,” he said.

Dorsey wouldn’t say how he intends to vote, but he signaled he strongly supports the project.

“From everything I know at this point, I’m very much still of the opinion that this is a very necessary step forward for Arlington,” Dorsey said.

Local newsletters: Local headlines (8 a.m.) | Afternoon Buzz (4 p.m.)

Like PostLocal on Facebook | Follow @postlocal on Twitter | Latest local news