Arlington, VA

Progressive Voice is a weekly opinion column. The views and opinions expressed in the column are those of the individual authors and do not necessarily reflect the views of their organizations or ARLnow.com.

By Takis Karantonis

Amazon’s public “beauty contest” about where it will locate a second headquarters has re-energized the discussion about investment incentives and responsible community benefit negotiations. Is competing for Amazon’s HQ2 a good thing for Arlington? What determines the acceptable balance of costs and benefits?

Skeptics fear that Arlington (and its partner Alexandria) may overestimate the ROI (return on investment) or underestimate its adverse impacts — and end up offering too sweet of a deal to Amazon.

Supporters see gains for the private and public dollars invested and an offset for many of the possible negative impacts.

This public discussion is taking place in the context of Arlington’s expensive housing market and chronic underinvestment in key infrastructure and critical public assets (transit, school capacity). How might a “good deal” overcome these obstacles?

If Amazon decides to come here, it intends to invest $5 billion over 10 years and would bring 50,000 jobs to our area, which currently has about 3.2 million jobs.

Amazon HQ2 and its employees would enlarge our local economy and the tax-base that supports our schools, services and community investments. Any incentives offered by the state and/or affected local jurisdictions are intended to attract investors and facilitate this virtuous cycle.

However, Arlington should be asking for reasonable investments from large corporations that are relocating here.

As one example, a good deal should emphasize Amazon’s use of public transit and disincentivize car-based commuting. Amazon should be invited to participate in public-private and direct investment in public transit in addition to its mandatory contributions to our transportation improvement fund.

Route 1 is as transit-efficient as it gets: two Metrorail lines, Virginia Railway Express, a bus rapid transit line and National Airport. Amazon HQ2, however, would require accelerating Metro and VRE improvements, and expanding Metroway-BRT. These improvements are compelling in their own right, and Amazon HQ2 should demonstrate how it would act as a catalyst for further improvements.

Another example: Arlington has plans to responsibly accommodate its share of growth along its urban corridors. However more needs to be done, including putting new housing supply policies to work, such as allowing for missing-middle land-use and gentle density, where appropriate. Amazon should demonstrate how it will contribute to wise land use, not exacerbate the current stresses that Arlington faces.

A third example: Amazon’s compliance with Arlington’s Community Energy Plan and Alexandria’s Eco-district planning should be expected as these plans support our community values and pay off for all involved: investors, community and the environment.

Fourth, the stresses for school space affect virtually all parts of Arlington. Amazon should participate actively in how projections of its arrival worsen this problem–and what it might do to ameliorate it in advance.

And what would Arlington bring to “a good deal” besides the obvious, but not trivial (location, well-educated population, etc.)?

The fact that Arlington teamed up with Alexandria for this project is a big step forward.

Amazon HQ2’s size and potential impact are well within what our region as a whole can handle. So we have met a prerequisite for a “good” Amazon deal–better regional cooperation.

So many new jobs and employees will unavoidably strain our tight housing market. In fact, investors see lack of housing availability and affordability–next to our infamous traffic problems–as the biggest drawbacks. Therefore, a good deal demands a regional commitment to increase housing supply and defend affordability. Arlington has such plans on the books, yet must better manage priorities and focus public investment.

Attracting major corporations makes our region economically more diverse and resilient. Big corporations often turn out to be fair and reliable long-term partners. Arlington is home to more than a few, to our mutual benefit. The key question is whether we are determined to maximize return on our hard-earned competitive advantages. Any incentives to an incoming corporation need to reflect credible and quantifiable current and future community benefits.

Amazon’s proposal would create quality jobs and makes the most of our key assets: our workforce, our brainpower, our infrastructure, our urbanism and our location. Its benefits should be welcome despite its notable adverse impacts. Yet the deal itself hinges on the all-important details, which will require a thorough and public debate in which our citizens should be engaging soon.

Takis Karantonis is an economist who has lived in Arlington for 12 years. He served earlier as the Executive Director of the Columbia Pike Revitalization Organization (CPRO), as well as on several advisory commissions, non-profit boards and the Board of his Columbia Heights Civic Association.

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