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Political backlash for HQ2 prompts Amazon to pull plug on NYC campus

"You have to be tough to make it in New York City. We gave Amazon the opportunity to be a good neighbor," Mayor Bill de Blasio said in response.

By Clyde Hughes
Political backlash for HQ2 prompts Amazon to pull plug on NYC campus
Retailer Amazon announced Thursday it has canceled a plan to build a second headquarters campus in New York City. File Photo by John Angelillo/UPI . | License Photo

Feb. 14 (UPI) -- Retail giant Amazon said Thursday it's given up plans to open a second headquarters campus in New York City -- canceling a major project that was hailed by leaders and promised to add billions to the city economy.

The announcement ended several months of acrimony among some legislators and experts that was generated by the project.

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Amazon selected Queens and suburban Washington, D.C., in November for its so-called "HQ2" locations, which is an expansion plan by Amazon to establish itself away from its main headquarters in Seattle. Several lawmakers balked at the move, saying New York City Mayor Bill de Blasio and Gov. Andrew Cuomo gave up too much in incentives to attract Amazon.

The decision came a week after New York Democrats picked state Sen. Michael Gianaris, a leading Amazon critic, to the critical Public Authorities Control Board, which has oversight of a $505 million construction grant for the project. Gianaris said he opposed the deal at its core and did not think re-negotiations would change his opinion.

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"After much thought and deliberation, we've decided not to move forward with our plans to build a headquarters for Amazon in Long Island City, Queens," Amazon said in a statement. "For Amazon, the commitment to build a new headquarters requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term.

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"While polls show that 70 percent of New Yorkers support our plans and investment, a number of state and local politicians have made it clear that they oppose our presence and will not work with us to build the type of relationships that are required to go forward with the project we and many others envisioned in Long Island City."

Amazon said it would not reopen its search for another campus to replace New York City. The announcement doesn't affect the planned campus in Crystal City, Md., or another Amazon facility in Nashville, Tenn.

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Gianaris told CNBC Thursday before the announcement he'd consider it a "victory" if Amazon walked away from New York City.

Mayor Bill de Blasio said in a statement Thursday Amazon "threw away" an opportunity to work with New Yorkers.

"You have to be tough to make it in New York City," de Blasio said. "We gave Amazon the opportunity to be a good neighbor and do business in the greatest city in the world. Instead of working with the community, Amazon threw away that opportunity.

"We have the best talent in the world and every day we are growing a stronger and fairer economy for everyone. If Amazon can't recognize what that's worth, its competitors will."

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New York City Council Speaker Corey Johnson said he hopes negotiations with companies like Amazon will be more open in the future.

"I look forward to working with companies that understand that if you're willing to engage with New Yorkers and work through challenging issues New York City is the world's best place to do business," Johnson tweeted. "I hope this is the start of a conversation about vulture capitalism and where our tax dollars are best spent. I know I'd choose mass transit over helipads any day."

New York congressman Peter King bemoaned the news, blaming "progressives" for the loss of 25,000 potential jobs.

"Absolutely disgraceful that Amazon is driven from New York by left wing progressive politicians. Terrible loss of jobs for New York workers and New York economy," King tweeted.

Rep. Alexandria Ocasio-Cortez, whose district includes Long Island City, criticized the deal when it was first announced, months before she officially took her seat in Congress. New York city councilman Jimmy van Bramer, who represents the area, also complained about the tax breaks Amazon was getting.

Nathan Lents, a Queens resident and professor at John Jay College, celebrated the pullout.

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"Don't forget how this actually went down. The great [Sen.] Gianaris was simply insisting for transparency and oversight and that made Amazon balk," he tweeted. "This shows their plan all along was to bully and weasel out of their end of an already one-sided deal."

Others were disappointed to what Amazon could have done for the city's technology sector.

"Amazon's decision to withdraw from New York is no doubt a blow to our local economy," Julie Samuels, executive director at Tech: NYC, told Bloomberg. "New York City is today one of the most dynamic tech hubs in the world, but there is no guarantee we will maintain this status in the future, which makes this news so disappointing."

Mark Hambrick, an analyst at Bankrate.com, said he was surprised and wondered allowed what message it might send to other companies wanting to do business in New York.

"This is a stunning development, with Amazon essentially giving in to vocal critics," Hamrick said. "For those who didn't want Amazon to bring the promised 25,000 new jobs and added economic vitality to the area: Be careful what you wish for."

The Retail, Wholesale and Department Store Union, a critic of Amazon, criticized the company for failing to address the concerns raised by opponents to the HQ2 plan.

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"Rather than addressing the legitimate concerns that have been raised by many New Yorkers Amazon says 'you do it our way or not at all, we will not even consider the concerns of New Yorkers,'" Chelsea Connor, director of communications for the union, said in an emailed statement.

"That's not what a responsible business would do."

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