Can D.C. Region Overcome Its ‘Achilles Heel’ in Amazon Competition?

Steve Burns

WASHINGTON – (WMAL) The news that the D.C. region is home to three finalists in the Amazon HQ2 competition was welcome for most, but it caused some others to wince.

“We’re somewhat cursed by state lines,” D.C. business insider Jim Dinegar, now with APCO Worldwide, told WMAL. “Becoming regional seems to be part of our Achilles heel, and yet here’s an opportunity to do just that.”

The idea of one bid covering the entire D.C. region was quickly shot down in the Metropolitan Washington Council of Governments, and now individual jurisdictions could point to the fruits of their efforts: the region was the only one in the country to boast three finalists for the mega-project: Montgomery County, the District, and Northern Virginia were all named.

But it may not be too outlandish to suggest Amazon may have more nefarious motives in making that decision.

“It’s perfectly reasonable to think that the rapacious capitalists at Amazon, who are totally good at their jobs, are thinking about how they can extract the most generous incentive package from a region that, maybe, they’ve already decided they’d like to be in,” said Alan Berube of the Brookings Institute’s Metropolitan Policy Program. “So, what’s the downside of telling three jurisdictions that they’re all still in the game and seeing which one will open up their wallets the most?”

Maryland Governor Larry Hogan fired the opening salvo in that debate, announcing Monday that he is willing to offer $3 billion in tax breaks and $2 billion in transportation upgrades to lure Amazon to Montgomery County. Of places that have made their plans public, Maryland trails only New Jersey’s proposal. Governor Chris Christie, just before he left office, announced $7 billion in incentives to entice Amazon to locate in Newark.

“It’s an eye-popping figure,” Berube said of Hogan’s offer. “The game is on.”

The project represents good timing for Hogan, who is up for re-election this year. It could stand to boost his image on a signature issue – economic development.

“If he could recruit Amazon, it could be a big win for the state, but it would also really validate his claim to be the guy who can recruit business to Maryland,” American University political scientist David Lublin told WMAL.

It could also bode well politically for Hogan this November, despite his preferred site of Baltimore not showing up on Amazon’s list of finalists.

“He’ll never win (Montgomery County) or come close to it, but it’s about the total number of votes across the state, and if he can chip away at the Democratic margins here in Montgomery, it would certainly do him a lot of good,” Lublin said.

Amazon’s request for proposals noted strong local government support was a necessity. While each respective jurisdiction is behind its own proposal, going across a street or river will put you in enemy territory.

“When it comes to the economic development game, the states are putting their money in, the locals are putting their money in,” Berube said. “We’re so close to one another, that I think whatever problem other regions have around cooperation, the D.C. region has it on steroids.”

While nobody expects a consolidation of bids this late in the game, there are still ways the region can promote cohesiveness, and that could go a long way towards winning the sweepstakes.

“(Amazon) is very concerned about how welcome they would be on their list of 20,” Dinegar said. “It would be very helpful to help Amazon settle here well, meaning enter the marketplace well, and the best way to do that is regionally.”

Dinegar suggested regional leaders identify a list of priorities that could be a recipient of Amazon’s potential philanthropy. Among his suggestions are cleaning up waterways like the Chesapeake, Potomac, or Anacostia, or dedicating some money to fund Metro, which will undoubtedly help move a significant portion of its 50,000 expected workers.

It might also go a long way to ingratiating the region’s residents to the company.

“My concern is that if we don’t pay attention to how to welcome Amazon, we may just shoot ourselves in the foot,” he said.

Should one of the region’s bids come out on top, he said, the entire area still stands to benefit.

“You’ll have people live, as everybody does, they live in one jurisdiction and work in another, and send their kids to a third. That’s how the greater Washington region’s borders don’t really pop up,” he said. “If we realize that the size and scope of this is unheard of, maybe we tackle it as a region.”

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