NEW YORK — Amazon representatives faced a bitter welcoming committee on Wednesday at its first New York City Council hearing to discuss the company's plan to open one of its two new headquarters, dubbed HQ2, in Long Island City, New York.
When details of the deal were announced in November, the $3 billion in performance-based financial incentives that New York state and New York City offered the company led to an immediate protest. At Wednesday's meeting, the protests continued, with about 150 demonstrators from union organizations and local worker advocacy groups gathering at City Hall and filling its chambers.
During the hearing, council members decried the company's "offensive" lack of transparency and accused the tech and retail giant of "ripping off" New Yorkers.
"You're worth a trillion dollars," New York City Council Speaker Corey Johnson told the company, prompting applause and cheers from protesters in the hall. "Why do you need our $3 billion when we have crumbling subways, crumbling public housing, people without health care, public schools that are overcrowded?"
The president of the New York City Economic Development Corporation, James Patchett, defended the deal at the hearing, along with Amazon's vice president of public policy, Brian Huseman, and Amazon's HQ2 search executive, Holly Sullivan. Both Patchett and Huseman referenced an estimated $27.5 billion in tax revenue for the state and city over the next 25 years as a result of the project.
In return for the subsidies and grants New York offered, Amazon promised to create at least 25,000 new full-time jobs in the city, along with a new school with space for 600 students. (Amazon also selected Arlington, Virginia, for a second headquarters; Virginia offered $573 million in incentives for the creation of 25,000 jobs.)
“We want to be a good neighbor to the residents of Long Island City and the rest of New York,” said Huseman. “We believe both our employees and community will benefit from being stitched into the fabric of the neighborhood where amenities are open to everyone.”
Amazon, Huseman said, already employs 5,000 people in New York. Its fulfillment center in Staten Island pays workers between $17 and $23 an hour. Patchett also referenced a Quinnipiac University poll published last week that shows 57% of New Yorkers approve of the deal, compared to 26% who disapprove.
The poll numbers did little to assuage Johnson's ire over the deal's opaque process and hefty financial incentives. Along with other city council members, he questioned the role that the financial incentives played in luring the company to call Long Island City its new headquarters' home.
Amazon brokered the deal with New York state and New York City behind closed doors and with the additional secrecy of nondisclosure agreements, which are common contracts cities sign with companies that claim to have proprietary information.
"So whose interest did you feel like you were representing in negotiating this deal?" asked Johnson.
"One hundred percent the people of New York City," said Patchett, as protesters laughed in the audience. "I fundamentally believe this is a good deal for New York City, or I wouldn't be sitting here today."
Several council members slammed New York City's Economic Development Corporation for selecting to categorize the project as a "general project plan," which allows the project to bypass public land use review processes. "I think it's fundamentally unethical with what you have done," said city council member Jimmy Van Bramer, who represents the district that includes Long Island City. "You should be ashamed of yourself."
Patchett told the council that his agency wanted to expedite the deal rather than weigh it down with additional reviews that would be required by the city's land use review process.
At other points during the hearing, protesters interjected with chants.
"When Amazon workers are under attack, what do we do? Stand up, fight back!" they yelled from the council chambers balcony. "G-T-F-O, Amazon has got to go!"
At another point, a protester stood up during the hearing to say the company's promise of 25,000 jobs for the city was "smoke and mirrors."
At the end of the two and a half hour hearing, Johnson asked Huseman if Amazon would schedule a public hearing during which the community could attend and voice their concerns about the project. Under pressure, Huseman eventually agreed to attend a future hearing. Johnson said the city council will schedule an additional public hearing in January or February around Huseman's schedule.
Ultimately, the city council is limited in what it can do to stop or renegotiate the deal — though some state legislators, including state Sen. Michael Gianaris, have floated the idea of using legislation to block HQ2.