Why Are Local Governments Keeping Their Residents in the Dark on Amazon Handouts?

By January 12, 2018Corporate Welfare

Local governments offering sweetheart deals and taxpayer dollars to big businesses is bad. Local governments keeping the details of those deals a secret is even worse.

Over the past few months, city, county and state officials around the country have been tripping over themselves trying to win Amazon’s second headquarters sweepstakes. But in some cases, they’re not disclosing their terms of enticement.

More than 15 localities, from Georgia to Kansas, from Philadelphia to Las Vegas, have refused to lay out exactly what they’ve offered Amazon.

Some officials said they aren’t releasing the information because they fear they would lose their competitive edge. Rhode Island Gov. Gina Raimondo said the state won’t tell taxpayers because they “want to be in the best possible position to negotiate.” Others say the information is a “trade secret.”

But based on the proposals other cities have released, there’s a bigger reason officials may be reluctant: They know taxpayers won’t be happy when they see the outlandish details. Lawmakers have been offering massive tax breaks, hefty taxpayer-funded handouts, free land and more. They’re getting creative, too, but not in a good way.

Fresno, for example, would let Amazon have a say in how the city spends the tax revenue it collects from the company for the next century. Every project Amazon authorizes would have a “brought to you by Amazon sign” in front. Not to be outdone, Chicago is offering to let Amazon keep the income tax paid by its employees.

These kinds of sweetheart deals aren’t just unfair to local businesses and taxpayers—they often don’t yield the rosy results officials expect. One study found that big corporate welfare deals cost taxpayers $450,000 for every job they created.

If lawmakers are going to be promising taxpayer money to out-of-town businesses, the taxpayers have a right to know what’s on the table. Residents should be able to hold their officials accountable when they make unwise and unfair deals.

If you’re fed up with taxpayer handouts to big businesses, tell your lawmakers it’s time to stop corporate welfare.

Author Jim Fellinger

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