Nothing is too strange for cities wooing Amazon to build there

In Philadelphia, hundreds of Wharton Business School students have a new fall semester assignment: Pitch the city to Amazon. And the mayor of Ottawa, Ontario, flew to Seattle last week to walk as close to Amazon’s headquarters as is publicly accessible.

“It’s like ‘The Amazing Race’,” said Jim Watson, the mayor of Ottawa. “You’ve got this cast of characters running toward the Holy Grail.”

Amazon, on the hunt for a place to build a second headquarters, where it plans to invest $US5 billion ($6.3 billion) and create 50,000 jobs, has begun an enormous competition among cities across North America. With a loose set of requirements such as proximity to an airport and walkability, the e-commerce behemoth has set officials on a journey to sell their towns, with the aim of getting in on what some are calling one of the largest economic development deals of the century.

That sometimes means going to extreme lengths to draw Bezos‘ eye. Is Bezos impressed?

“We’re energised by the response,” said Adam Sedo, an Amazon spokesman. “We invited cities to think big, and we are starting to see their creativity.”

There will be jobs for about 50,000 people in the city that wins the right to host Amazon’s second headquarters. Photo: Simon Dawson/Bloomberg

For Jeff Cheney, the mayor of Frisco, Texas, a city of 160,000 about a half-hour drive from Dallas, the courtship includes offering to build his city around Amazon.

“Our city’s only about 60 per cent built out, so we’ve got a lot of available land where we can build to suit,” Cheney said. “We play to win. We’re innovators. We’re forward thinkers, and we’re serious.”

City applications are not due until October 19, but Cheney has already sent a video letter to Amazon. The video opens on him holding an Amazon box and saying, “Amazon, you’re growing your business, and we want to grow with you.” Jerry Jones, the owner of the Dallas Cowboys, is seen talking about catching the “Frisco Flu,” which the mayor’s office said was a phrase Jones came up with. Cheney also gets a Jamba Juice (Jamba Juice is based in Frisco).

Mayoral letters to Amazon are actually becoming a YouTube subgenre.

Mark Boughton, the mayor of Danbury, Connecticut, posted a video on September 14 calling himself a “proud Amazon customer” and asking Alexa, the Amazon virtual assistant, where Amazon should build its second headquarters. “Danbury,” a female voice responds.

It seems Alexa might be suffering a software glitch, because when Muriel Bowser, the mayor of Washington, posted a video on September 15 asking, “Alexa, where is the most interesting company in the world going to locate?” there was a different response. “Obviously, Washington, DC,” Alexa said.

In Canada, the selling point is, well, Canada.

Image: Gary Hovland/The New York Times

“Amazon has something like 9000 engineering jobs they can’t fill. Our immigration policy is much more liberal,” said Watson, Ottawa’s mayor. “That’s where we have an advantage.”

Another city offering access to Canadian immigration as part of its deal is, surprisingly, Detroit. Working with nearby Windsor, Ontario, which is an eight-minute drive away, Detroit is portraying itself as the best of both worlds.

“There’s, you know, the immigration issue, we avoid that,” said Dan Gilbert, a local business leader in Detroit who was asked by the city’s mayor, Mike Duggan, to lead the effort to land Amazon. “You’ve got Canada and the US. And people will come from all over.”

Gilbert, the founder of Quicken Loans, has also built an Amazon war room, where more than 40 people are trying to analyse what the online retailer “likes and doesn’t like”. They are also trying to read Bezos‘ psyche. “He’s got hundreds of hours of videos on YouTube you can watch,” Gilbert said.

Gilbert is the largest private property owner in downtown Detroit, and he said he would move his tenants to temporary locations to make room for Amazon so the company did not have to wait for new offices to be built.

Competitions for factories or stadiums are typically more private, but this one is playing out in the court of public opinion, said Lauren Hitt, who is managing the public side of the campaign for Philadelphia.

“The competition started that Thursday morning when he announced it,” Hitt said of Bezos. “The next weeks are basically going to be a sustained campaign.”

Philadelphia’s effort includes students from the Wharton School writing variations on the very same pitch: why Amazon should come to Philadelphia. This was the school’s idea, Hitt said. Dozens of startups have also been asked to submit testimonials about the city’s innovation economy and advice on how to approach Amazon.

And Philadelphia, which sent a delegation to Seattle last week, is sending a larger delegation this week to “get into the Jeff Bezos mindset and ethos,” Hitt said.

The city would also consider overhauling its tax system for Amazon.

“Having Amazon would mean global things for our tax system,” Hitt said. “We do have business taxes, but that’s something that could be looked at in the scope of Amazon coming here.”

G.T. Bynum, the mayor of Tulsa, which set up its own Amazon war room in his office, echoed Philadelphia’s sentiment on taxes. He said he “doesn’t worry at all” about tax incentives going too far. “These are 50,000 jobs with the most innovative company in the world.”

“Whatever it takes,” he said.

Tax policy experts are more sceptical of Amazon’s bidding process and how much cities stand to benefit.

“Why are they doing this whole dog-and-pony show? Amazon wants something for nothing,” said Matthew Gardner, a senior fellow at the Institute on Taxation and Economic Policy, a nonpartisan think tank. “They would like a package of tax incentives for something they were going to do anyway.”

Art Rolnick, an economist at the University of Minnesota, called Amazon’s bidding process – and the broader practice of cities competing for stadiums and factories – “blackmail.”

“If you look at it from a national perspective, it’s zero returns. Minnesota might win one, Wisconsin wins the next one. The company wins each time,” Rolnick said. “It’s corporate welfare.”

But Gardner acknowledged that many cities really had no other course than to try to win Amazon. “If you ask any mayor, they’ll say their first job is to bring good jobs to the city,” he said. “And Amazon is promising to bring a lot of jobs.”

Joe Snell, a business leader with an economic development group in Tucson, was behind the recent shipment to Bezos of the local saguaro cactus, which he said was symbolic of the region’s people.

“It’s a hearty plant. It can grow up to 40 feet. And that’s Tucson,” Snell said. “We’re a community that’s growing. We’re adaptive. And we’re durable.”

Amazon said it could not accept gifts but thanked Tucson on Twitter. The company then returned the plant to the city. That was a good outcome for the cactus, which would suffer in the Seattle rain.

Still, Snell had achieved his goal.