Maryland approves billions in incentives to lure Amazon H2Q

April 4, 2018

ANNAPOLIS, Md. (AP) — The Maryland General Assembly gave final passage Wednesday to an estimated $5.6 billion incentive package to lure Amazon’s second headquarters to Maryland.

The House of Delegates voted 79-59 Wednesday for the bill, sending it to Gov. Larry Hogan, who submitted the plan to the Democrat-controlled legislature. A spokeswoman for the Republican governor said he will sign the bill. Supporters described it as a huge economic opportunity for the state, including tens of thousands of new jobs.

“This bill seizes upon a once-in-a-lifetime chance to attract a project with the potential to reshape Maryland’s economic landscape,” said Del. Anne Kaiser, a Montgomery County Democrat who chairs the House Ways and Means Committee.

Opponents derided it as corporate welfare for one of the world’s richest companies.

Del. Herb McMillan, an Anne Arundel County Republican, said state budget analysts couldn’t calculate the actual benefit of the proposal to Maryland, because Amazon declined to release proprietary information to conduct such an analysis. He also criticized tax breaks the state has approved in recent years for several large companies, while small businesses and state residents were not getting tax cuts.

“They’re dealing with the reality of Maryland taxes and regulation to finance the Amazon fantasy,” McMillan said. “Amazon is getting the gold mine, and they’re getting the shaft.”

The measure includes a package of state-income, property and sales-tax credits that would be spread out over about 25 years. Tax credits would be based on wages the company pays, a sales-tax exemption on some of its equipment and materials and property-tax credits. They would not take effect if Amazon decides not to locate the headquarters in Maryland — and would not be automatic even if it does, supporters stressed. The company would have to meet benchmarks on job creation and salaries in order to receive them, they said.

“The worst that happens is that we don’t lose anything and the best that happens is 50,000 new jobs,” Kaiser said.

The state also is considering transportation upgrades of about $2 billion in addition to the tax incentives.

Supporters also said the indirect economic impact would be huge. Kaiser cited estimates that the headquarters ultimately would produce more than 100,000 jobs, with more than $17 billion in increased economic activity.

Montgomery County, Maryland, is one of 20 cities and regions that made Amazon’s shortlist.

Amazon’s search for its second headquarters location has triggered an unprecedented competition among governments in North America.

Amazon’s list includes New York, Boston, Los Angeles, Indianapolis, Washington, D.C., Denver, Miami, Atlanta and Chicago. Texas’ Austin and Dallas made the cut, as did Philadelphia and Pittsburgh in Pennsylvania. The others are Columbus, Ohio; Montgomery County, Maryland; Nashville, Tennessee; Newark, New Jersey; Northern Virginia; and Raleigh, North Carolina. Toronto also is on the list.

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