Maryland pledges ‘biggest incentive offer in the state’s history’ to lure Amazon HQ2

Top Maryland officials are preparing to offer Amazon.com Inc. a massive, historic tax incentive package if the retailer moves its second headquarters to the state.

“It will be the biggest incentive offer in the state’s history by a mile,” said Douglass Mayer, spokesman for Gov. Larry Hogan, who declined to reveal details of the incentive package, citing competition from other states.

As the final days tick away for the deadline to send a proposal to Amazon (NASDAQ: AMZN) to locate its second headquarters away from Seattle, the hype is growing for hundreds of cities and states, Maryland included.

Already, the state has invested more than $50 million in tax incentives for two Amazon distribution centers in Baltimore and Cecil County. Another package totaling at least $16.2 million is awaiting a deal under negotiation in Baltimore County at the former Sparrows Point steel mill site.

In total, Amazon has netted $1.24 billion in taxpayer backed incentives across the U.S., a special report by the Business Journals highlighted this week.

Mayer said Hogan had sanctioned the pie-in-the-sky tax break package as part of the ongoing push for HQ2 and monitors the developing bids daily. The historic incentive package no doubt will blast past the $317 million offered to the Federal Bureau of Investigation to move its headquarters to Prince George’s County last year.

“We’re going to use every single economic development tool at our disposal,” Mayer said. “We believe the HQ2 is the most dramatic and consequential economic development project in a generation.”

The giant retailer started the bidding war last month and set Oct. 19 as its deadline for cities to send proposals to its home base in Seattle. The call sent economic development, politicians, academic administrators and corporate leaders into a six-week frenzy with a goal to snag the $5.5 billion investment and 50,000 jobs.

It’s like the Olympics of economic development, only under wraps.

“We don’t want to show our cards to our competitors,” said David S. Iannucci, assistant chief for the Office of Economic Development in Prince George’s County who on Thursday was proofing a 100-page bid from his office before sending it to the printer.

“We’ll get it to print for delivery by Oct. 17 to FedEx for Seattle,” he added.

The rest, as they say, is a mystery.

The Baltimore Business Journal and its sister publications on Wednesday published a national package on Amazon.com and its growth since launching as an online book seller in 1994.

Research and interviews with dozens of sources across the U.S. showed the giant retailer has grown with the help of $1.24 billion in taxpayer funded incentives. Last year alone, Amazon added 26 new fulfillment centers to its worldwide network. Overall, the company has 257 warehouses either open or under construction.

In Maryland, Amazon has hired 4,000 workers in the past three years to work at two large distribution centers and other smaller hubs. The company announced Thursday it was seeking to hire more than 3,000 seasonal roles picking, packing and shipping customer orders for the upcoming holiday season.

Mayer said Hogan monitors the HQ2 process daily through his cabinet, especially Mike Gill, secretary of the Department of Commerce, which has has submitted incentive packages for all of the proposals headed for Amazon.

Prince George’s County’s bid highlights College Park and joins proposals from Baltimore for Port Covington, the swath of waterfront land being developed by Under Armour CEO Kevin Plank’s Sagamore Development Co. and others from Howard, Montgomery and Charles Counties.

All are rich in hype and details — but the public likely won’t see them for a while, if ever. So far, snippets of other support have leaked out in the form of letters and personal outreach from several corporate leaders, Johns Hopkins University and University of Maryland administrators and other businesses.

The goal is to make the first cut, Iannucci said. That means being included in a class of no more than two dozen proposals out of an anticipated 500.

“We believe there will be about 200 jurisdictions sending in up to 500 different sites nationally for Amazon to choose from, and a lot will be pretty extraordinary proposals. Amazon is in a strong position to choose from the very best,” Iannucci said. “We’ve had good support from the state and we think we’re going to get their attention. Everybody’s goal is to get inside Amazon’s head.”

Mayor Catherine Pugh said details would be held close for now.

“The mayor has been advised that to release the city’s proposal prior to its review by Amazon would put us at a disadvantage,” said Anthony McCarthy, Pugh’s spokesman, in an email Wednesday. “She is committed to releasing it but we don’t have a timetable currently of when that will happen.”

Susan Yum, a spokeswoman for the Baltimore Development Corp., which is spearheading the effort in the city, echoed Pugh.

“Right now, our primary focus is on putting together the best possible proposal and meeting the deadline,” Yum said.

Sagamore Development spokesman John Maroon said: “All parties are singularly focused on getting bid completed.”

Iannucci, also declined to reveal any details, but said the bid was comprehensive and offered three sites in the suburban Washington D.C. area.

He called the Prince George’s County effort Herculean, saying: “In 20 days, we have put up a war room … and put out an RFP in excess of 100 pages. I am very proud of how we handled this ridiculous timeline for a comprehensive response.”

 As featured in the Washington Business Journal 

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