Baby Boy for Cristol — Arlington County Board member Katie Cristol gave birth to her first child, a baby boy, this past weekend. She plans to call in to Saturday’s County Board meeting and participate in the crucial Amazon incentive package vote. [Twitter]
Building Plans for Temporary Amazon Office — JBG Smith “submitted plans March 7 to make common area improvements throughout the 12-story, 221,000-square-foot [office building at] 1800 S. Bell St., to be leased in full by Amazon.” [Washington Business Journal]
County May Change Building Plan Practices — “Arlington officials are considering ending same-day viewing at the Department of Community Planning, Housing & Development after a Washington Business Journal reporter asked to view a permit for a building Amazon.com Inc. is expected to lease, said Ben Aiken, director of constituent services in the county manager’s office.” [Washington Business Journal]
VRE Plans Moving Forward — “Virginia Railway Express is moving forward with plans to build an expanded Crystal City Station, a key step needed to expand and improve service. The VRE Operations Board is due to vote Friday to allow contracting to move forward for engineering work based on the already approved concept design.” [WTOP]
New Leases in Rosslyn — Earlier this week Monday Properties announced the signing of three lease deals at 1100 Wilson Boulevard, one half of its Rosslyn twin towers. The firms leasing new space are The Health Management Academy and Trilogy Federal LLC, while WJLA owner Sinclair Broadcasting is expanding its existing space. [Monday Properties]
Extensive Road Closures Saturday — Expect a number of road closures in Courthouse, Rosslyn and near the Pentagon Saturday morning for the annual Four Courts Four Miler. [Arlington County]
Nearby: Gentrification Fears in Arlandria — “Concern of rising rents and gentrification have always been present in the Arlandria neighborhood, which sits between South Glebe and West Glebe roads and ends at Potomac Yard. Amazon.com Inc.’s plan to move to nearby Arlington has only intensified those worries.” [Washington Business Journal]
The following Letter to the Editor was submitted by Arlington Chamber of Commerce President Kate Bates, who writes in support of passing the county’s incentive deals made to motivate Amazon to open its new headquarters in Crystal City and Pentagon City.
The Chamber is a non-profit which advocates for 750 county businesses and organizations, which includes Amazon as of December. The Chamber has written several letters to County Board members and the Virginia General Assembly over the last year in support of bringing Amazon to the region, and to urge officials to pass state and local tax incentives.
The County Board will vote on Saturday for their incentive package finalizing Amazon’s plans to move to area.
It’s an exciting time for Arlington. On Saturday, the County Board will vote on the performance agreement for Amazon’s headquarters. Approving this agreement is a powerful statement that Arlington is open for business and we are no longer solely a government town, but a magnet for innovation in all sectors. Welcoming Amazon to Arlington will create opportunities for residents and businesses. The community as a whole will benefit from the jobs, economic activity, and innovation that Amazon will bring to Arlington. The performance agreement is a good deal for Arlington.
Economic Well-being
Amazon’s commitment to Arlington will provide us with balance; adding business diversity will strengthen our local economy. The job losses from BRAC and sequestration, and the uncertainty of the recent shutdown have shown that we cannot rely on the Federal Government alone for our prosperity. Amazon gradually adding 25,000-37,850 private-sector jobs will replace the 24,000 federal and contractor jobs lost in the Crystal City area over the past two decades.
Amazon’s presence will solidify Arlington as an innovation hub. Having Amazon as an anchor will help Arlington and Northern Virginia attract innovative companies. A robust job market will provide opportunities for our young people to succeed here, in the community where they are growing up and getting their education. Our local businesses expect Amazon’s arrival and the resulting diversification in our local economy to help them thrive.
Incentives
Arlington Economic Development crafted a groundbreaking incentive package that truly invests in Arlington’s future. The overwhelming majority, 95%, of the Arlington incentive package comprises investments in our community through housing, transportation, and infrastructure. The incentive payment to Amazon, the other 5%, depends Amazon hitting their established benchmarks for office space.
The direct financial incentive to Amazon is funded through a fraction of the growth in the Transient Occupancy Tax, a tax paid by guests staying in Arlington’s hotels. Tying Amazon’s direct incentives to revenue growth ensures that payments will not divert money from other priorities. Focusing on the Transient Occupancy Tax means that taxes on Arlington residents and businesses will not fund these incentives and that Amazon will receive these payments only if our hoteliers grow their businesses too.
Community
In the months since the announcement, Amazon has shown they want to be a part of the Arlington community. Amazon is already engaging, joining the Chamber and meeting with businesses, nonprofits, and community groups to build long-term relationships. Amazon’s Director of Community Engagement met with more than 50 leaders from Arlington nonprofits at a Chamber-hosted gathering, and senior Amazon team members have attended many community events. Amazon’s culture values making direct change; we look forward to the prospect of thousands of innovative people participating in our community.
The Amazon headquarters announcement has focused Arlington on our transportation, housing, and school funding challenges, all of which predate Amazon. The redevelopment of the Crystal City area will bring the transportation infrastructure improvements and amenities envisioned in its sector plan. Approving this agreement will help secure Arlington’s fiscal health and provide tax revenues to help the community address these challenges.
This is an historic moment for Arlington. The establishment of Amazon’s headquarters offers Arlington a unique occasion to strengthen our economy, to create opportunities for residents, and to improve the County’s fiscal position. We look forward to working together as a community to seize the opportunities that welcoming Amazon affords to all of Arlington.
ARLnow.com occasionally publishes thoughtful letters to the editor about issues of local interest. To submit a letter to the editor for consideration, please email it to [email protected]. Letters may be edited for content and brevity.
According to the National Science Board, in 2018, boys and girls scored similarly on math and science in elementary, middle and high school, and women graduated with 50% of the bachelor’s degrees in science and engineering.
So why is it that women remain vastly underrepresented in the STEM workforce?
In greater Crystal City (also known as National Landing), more than half the workforce has a background in STEM, and tech companies both large and small call Crystal City home.
The panel, moderated by Erica Pandey, e-commerce reporter at Axios, includes representatives from across the scope of STEM careers:
Rachel Golden Kroner, Social Scientist — Environmental Governance and Impacts at The Betty and Gordon Moore Center for Science, leads Conservation International’s work on environmental governance and protected areas, conducting research to inform evidence-based policy.
Hana Hassen, an Alumna of Year Up, is an Enterprise Software Engineer at Capital One and a member of the Year Up Alumni Board.
Carol O’Donnell, Director of the Smithsonian Science Education Center, a unit of the Smithsonian Institution that is dedicated to transforming the learning and teaching of science throughout the nation and world.
Lena Trudeau, CEO of U.Group, led Amazon Web Services Public Sector’s global expansion before joining Bytecubed in advance of their merge with CHIEF to become U.Group.
New protected bike lanes in Potomac Yard (via @mttrgrs)
A new protected bike lane in Crystal City (via @juddlumberjack)
A new protected bike lane in Potomac Yard (via @juddlumberjack)
Bicyclists in Potomac Yard and Crystal City might’ve noticed some funky new protected bike lanes around town — but some of them won’t be sticking around for long.
The lanes popped up this week to coincide with the “National Bike Summit,” a gathering of cycling activists held at the Hyatt Regency Crystal City.
Some of the protected lanes are located along S. Eads Street in Crystal City, near the road’s intersection with 22nd Street S. They’re part of the “BikeRail” product backed by Minneapolis-based firm Dero, and are a bit sturdier than the plastic poles the county has installed along other protected bike lanes.
The Crystal City Business Improvement District says Dero donated the BikeRails for pilot program purposes, and county staff installed them this week. They may not stay in their current locations, but the county plans to keep them a little longer, at least.
Another bike company sponsoring the conference, Bike Fixation, donated some even more unusual looking lanes for cyclists to try out.
Demonstration bike lane infrastructure in Arlington for the National Bike Summit is pretty sweet. pic.twitter.com/RLaPbmPngV
— Judd Lumberjack Isbell (@JuddLumberjack) March 10, 2019
The county set up the wave-shaped barriers along a stretch of S. Potomac Avenue in Potomac Yard, leading up to where the bike conference was held.
Those, however, are merely temporary, according to the League of American Bicyclists (which sponsored the conference). They could be gone as soon as sometime this week.
Photo 1 via @mttrgrs, photos 2 and 3 via @juddlumberjack
A staging lot for rideshare drivers in Crystal City, near its S. Eads Street exit (via Arlington County)
The rideshare staging lot for DCA that’s earned complaints around Crystal City (via Google Maps)
County officials and representatives from ridesharing companies are planning another community meeting to talk through traffic headaches generated by a staging lot for Uber and Lyft drivers serving Reagan National Airport passengers.
Arlington leaders will convene another gathering on the subject next week — in tandem with Uber, Lyft and airport executives — though they hope they’ve managed to alleviate many of the issues the community raised last fall.
At the time, many people living near the lot (located at 2780 Jefferson Davis Highway in Crystal City, adjacent to S. Eads Street and a Holiday Inn hotel) said the surge of rideshare drivers in the area had snarled traffic in the neighborhood.
Airport officials only started directing drivers over that way to account for National’s massive “Project Journey” construction effort, requiring drivers to wait in the lot until would-be passengers request rides. But, back then, the lot only had one entry/exit to reach S. Eads Street, prompting big traffic backups and encouraging drivers to cut through other parking lots in the area to more easily reach the airport.
The county responded with an “interim” fix designed to make a difference in the short-term — officials opened up another entrance/exit to the lot along Route 1, installing a temporary traffic light to allow drivers to turn onto the road and jump onto an exit ramp leading directly to the airport access road.
Since then, county staff say they’ve recorded a 73 percent drop in the number of cars exiting onto S. Eads Street each day. Officials say they’ve also met with Uber, Lyft and airport executives to discuss additional steps, like “exploring the use of technology and messaging through the [rideshare] apps to reduce the volume of vehicles coming to the lot and seeking additional staging locations to reduce demand.”
The county is also mulling another, more costly change.
Officials are currently exploring the possibility of aligning the lot’s temporary exit onto Route 1 with 27th Street S., which sits directly across from the staging area. That would allow cars from the lot and 27th Street to turn at the same time, perhaps cutting down on wait times at each traffic light.
“Implementation would require relocating a traffic signal pole, replacing [the] temporary traffic signal with a permanent traffic signal pole on Route 1, and reconfiguring the [rideshare] lot to allow proper ingress flow,” county staff wrote on Arlington’s website.
That project comes with a $250,000 price tag and take at least a year to complete — plus, it requires the County Board’s approval.
Staff plan to discuss that option and others at the upcoming meeting. It will be held in the Crystal City Community Room at the Crystal City Shops (2100 Crystal Drive) on March 18, from 6-7:30 p.m.
Arlington officials have pitched Amazon on a program to help the company slash its business license tax burden when it sets up shop in Pentagon City and Crystal City — but the county is also admitting that Amazon could avoid that particular tax altogether.
Should an incentive package designed to bring the tech giant’s new headquarters to Arlington win county approval this weekend, Amazon will still be subject to all manner of local levies. In particular, officials are counting on real estate tax revenues from the company to generate an extra $342 million for county coffers over the next 16 years.
But it’s an open question how much in business license taxes — a levy known as the “Business, Professional and Occupational License” tax or “BPOL” — Amazon will actually need to pay. It’s an issue that’s fueled outrage from local Amazon critics, who argue that the county shouldn’t be offering tax breaks to an extremely valuable company owned by the world’s richest man, which has already successfully avoided paying federal taxes for the last few years.
Documents show that county officials have already marketed Arlington’s “Technology Zone” program to the company, an incentive program that could help Amazon slash its BPOL burden by as much as 72 percent for the next 10 years. It’s unclear whether Amazon might qualify for the tax break, but county staff say it’s also a possibility that the BPOL tax might not apply to the company at all.
In a report prepared for the County Board ahead of this weekend’s vote, staff wrote that Amazon “may be classified as a type of company that is not subject to BPOL at all, such as a retailer or wholesaler.” State law does indeed allow for a variety of exemptions to the tax, with organizations from banks to newspapers eligible to avoid the BPOL levy.
Or perhaps Amazon could avoid the BPOL tax because it’s levied on each company’s “gross receipts.” Staff write that “as a corporate headquarters and global company, Amazon may not have gross receipts attributable to the Arlington location,” largely due to where the sales in question might originate.
Christina Winn, director of business investment for Arlington Economic Development, says the county will examine “the point of sale” in making that determination. If the sales happen somewhere other than Arlington, the BPOL tax may not apply to Amazon.
“Taxes are very complicated, especially with these large companies where all their consultants are based in other places,” Winn said. “They’re based here, but they may be on site in some other state.”
Victor Hoskins, the head of Arlington Economic Development, previously told the Washington Post that other companies with large corporate headquarters in the county (like Nestle and Lidl) have avoided the tax for just that sort of reason. He said it “just hasn’t been the case for large global companies” that they’ve been subject to the BPOL rate.
Staff stressed in the report that they haven’t included any BPOL revenues in their projections of the company’s fiscal impact on Arlington, given the uncertainty over Amazon’s eligibility for the tax. Instead, the county has based its revenue assumptions on real and personal property taxes, hotel stay and meals taxes and sales taxes — Arlington is also counting on BPOL taxes from the company’s landlord in Crystal City, developer JBG Smith.
“Because it’s such a big company with many different lines of business, and they don’t know what businesses are coming into the Arlington facility, we just assumed zero for gross receipts,” Winn said. “We just felt like that was the most conservative and responsible way to model this project.”
Amazon will need to sort out these tax questions with county staff, likely involving the commissioner of revenue’s office.
If the company does qualify for the BPOL tax after all, it could still apply for the “Technology Zone” incentive, though that only applies for 10 years, and would slash (but not eliminate) Amazon’s BPOL tax payments.
If the county judges that the business units located at Amazon’s Arlington headquarters have “a primary function in the creation, design and/or research and development of technology hardware or software,” the company would qualify for the tax break. The program has gone relatively unused since it was last updated in 2014 — for full disclosure, ARLnow’s parent company applied for the tax break in 2015, but was rejected, despite approximately 20 percent of the company’s budget being devoted to web design, development and hosting.
“That incentive zone is there for any business, and Amazon can take advantage of it, if they want to,” County Board Vice Chair Libby Garvey said during an interview on WAMU 88.5’s Kojo Nnamdi Show Friday. “So, we’re really treating Amazon — as hard as it is to believe — basically, like any other business. So, we’re not telling them that every other business can make use of this tech zone incentive that we have and you can’t.”
The Board is set to vote on the incentive package at its meeting Saturday (March 16), including the heart of the proposed offer to Amazon: an estimated $23 million over the next 15 years, drawn from a projected increase in hotel tax revenues driven by the company’s arrival.
However, the county has recently conceded that number could go higher (or lower) depending on what sort of impact local hotels actually see in the coming years. Amazon will only be permitted to use that cash on building and furnishing its new headquarters.
Amazon is sending a pop-up store into Crystal City today with the hopes Arlingtonians will stop by.
The store-on-wheels is dubbed the “Treasure Truck” and travels the country offering “new, trending, local, or delicious items” per a company spokesman. Today the truck will be parked at 2011 Crystal Drive until 1 p.m.
Amazon app users can sign up for notifications that alert them when the truck opens and whatever the truck is offering that day. Users can then purchase the items they want online and pick-up in person at the truck.
In the past, the truck has served up an array of items from brownies to gold Bohemian Rhapsody movie backpacks to lightbulbs, according to Twitter posts.
Indulge your sweet tooth on Treasure Truck today with brownies from Chicago's JR Dessert Bakery, just 19.99. And in select cities, pick up a free bag of new @BearNaked premium granola, too (while supplies last)! Treat yourself at https://t.co/IctiLxp7dcpic.twitter.com/cTIOx3GBVk
The truck’s inventory was not available to this reporter online as of 10:45 a.m. this morning.
Amazon’s treasure truck heralds the company’s impending move to the area scheduled for 2021, when it will begin construction for its second headquarters in the Crystal City and Pentagon City area that some local officials have attempted to rebrand as “National Landing.”
The trillion-dollar company’s promise to occupy long vacant real estate and add 25,000 jobs comes in exchange for $23 million in county grant money, $750 million in state incentives, and a head’s up on any Freedom of Information Act Requests, according to documents released this week. It’s a deal that’s drawn criticism from unions and affordable housing advocates as ARLnow previously reported.
Arlington County has also been criticized for directly pitching tax incentives Amazon would be eligible to receive, but which few other businesses have taken advantage of, as ARLnow reported this week.
Crash Closes Part of Parkway — A serious crash has closed the northbound lanes of the GW Parkway between the Daingerfield Island marina and I-395. A crash investigation is underway. [Twitter]
False Report Prompts Big Police Response — “At approximately 2:30 p.m. on March 6, police were dispatched to the report of a man brandishing a firearm in the lobby of” the Days Inn hotel on Arlington Blvd. “The investigation determined that no disturbance had occurred and that the reporting party allegedly had an ongoing dispute with the hotel over a refund. A warrant for Filing a False Police Report was obtained for the suspect.” [Arlington County]
Garage Races Cancelled This Weekend — Updated at 9:35 a.m. — Crystal City’s Crosshairs Garage Races series will continue to bring fearless cyclists and spectators together for races through one of the neighborhood’s sprawling parking garages later this month. This year the series is being held on Saturdays in March, but this weekend’s scheduled races have been canceled due to a water main break. [Crystal City, Twitter]
Local Road Project ‘On the Bubble’ — “With tolls set to begin on Interstate 395 in October and already underway for more than a year on Interstate 66 inside the Capital Beltway, the Northern Virginia Transportation Commission is set Thursday to consider the next steps of how to spend part of the money… Arlington County plans for a High Occupancy Vehicle and bus-only lane on Lee Highway in Rosslyn would be on the bubble.” [WTOP]
Remember to ‘Spring Forward’ This Weekend — “On Sunday, March 10, at 2 am, daylight saving time begins. We’ll set our clocks forward one hour, and the change will push sunsets later into the evening hours and sunrises later into the morning hours.” [Vox]
Some of Amazon’s future neighbors in Crystal City now say that they’re eager to see the County Board approve an incentive package to bring the company to Arlington.
The Crystal City Civic Association penned a letter of support Monday (March 4) for the company’s arrival in the neighborhood, encouraging the Board to give the green light to a plan to hand over $23 million in grant money to the tech giant over the next 15 years. The Board is set to consider the deal, publicly revealed for the first time this week, later this month.
Civic Association President Carol Fuller wrote that the citizens group still has “some concerns, obviously ‐‐ e.g., housing costs, traffic, schools.” But she says its members “look to the county to prepare adequately,” and trust that the neighborhood can handle the arrival of Amazon and its promised 25,000 workers.
“As the civic association to be most affected initially, we welcome the planned gradual arrival of Amazon to Crystal City,” Fuller wrote to the Board. “The $23 million in incentives from the county makes sense — they are paid only if/when Amazon creates the jobs it promised. Moreover, we expect the Amazon arrival to help increase hotel and restaurant business in Crystal City, which will increase county tax income and help pay for those incentives.”
In all, the county expects Amazon to generate $342 million in tax revenue over the 16 years the tech giant plans to spend setting up shop in the county — and that’s without the hefty tax break the company could soon earn from the county.
Fuller also cited the transportation improvements bound for the neighborhood as a major factor in her group’s support for the project, including the planned second entrance for the neighborhood’s Metro station and a pedestrian bridge connecting Crystal City to National Airport.
Some county officials and activists critical of the project have urged Amazon to better engage with its soon-to-be neighbors, and Fuller said the company has so far done a good job on that front. She pointed out that Holly Sullivan, the company’s worldwide economic development head who has begun appearing at some Arlington gatherings, stopped by the civic association’s Feb. 23 meeting and has been invited to return.
“We look to Amazon to fulfill its promise to be a ‘good neighbor,'” Fuller said. “We want them, both as a corporation and as individual residents, to be active participants in our community.”
Fuller’s support for the project echoes the broad sentiment of most county, and state, residents, who have said that they support the company’s arrival in both Crystal City and Pentagon City. The Arlington Chamber of Commerce, Crystal City Business Improvement District and the Crystal City Citizen Review Council have all issued recent statements similarly urging the Board to approve its incentive package for Amazon.
The Board is currently planning a vote on the matter on March 16. In the likely event the incentives are approved, Amazon expects to begin submitting plans for new office buildings shortly afterward.
Documents released in late January show that Arlington officials explicitly pitched the tech giant on the prospect of scoring major tax savings through the county’s “Technology Zone” program, back when they were still wooing Amazon last year. Created in 2001 and last updated in 2014, the program was designed to provide incentives for high-tech businesses to move to Arlington by offering significantly reduced rates for the county’s “Business, Professional and Occupational License” tax in certain neighborhoods.
Amazon wouldn’t be eligible to apply for the tax break until it actually sets up shop at its planned destinations in Crystal City and Pentagon City. One of the county’s “Technology Zones” runs along the “Jefferson Davis Corridor,” including the neighborhoods near Route 1 that the tech firm hopes to someday call home.
Once it arrives, however, the company could use the program to shrink its BPOL rate by as much as 72 percent for the next decade.
The potential tax break was not described in the memorandum of understanding laying out the county’s promised incentives to the company signed by both parties on Nov. 9, 2018, nor was it mentioned in any subsequent announcement of Arlington’s plans for Amazon.
Yet the county did advertise the program in documents dated Oct. 11, 2018, recently posted on the county’s website, outlining Arlington’s pitch to Amazon.
“Based on the jobs Amazon creates, if the company is eligible for tech zone benefits, it would apply each year for that BPOL credit,” said Cara O’Donnell, a spokeswoman for Arlington Economic Development, which helped broker the Amazon deal. “It’s a standard part of our proposals to technology-related companies and each one is handled individually.”
Critics of the deal see this potential tax saving as part of a pattern for Amazon, however.
Amazon is already set to receive $750 million in state incentives designed to defray its state tax burden, and Arlington officials have insisted that the company’s massive expansion plans could have a transformative impact on the county’s flagging tax revenues. Yet this BPOL tax break could result in Arlington losing out on a hefty chunk of cash from Amazon — the county collected $65.6 million in BPOL revenue in the last fiscal year, its third largest source of tax dollars behind the real estate and personal property levies.
“Their track record is clear — they try to do everything they can not to pay taxes,” said Danny Cendejas, an organizer with the “For Us, Not Amazon” coalition opposing the company’s Arlington plans. “I wouldn’t be surprised if they were looking for every possible loophole.”
But O’Donnell stressed that county officials “have not factored BPOL into any of our revenue projections” associated with the company’s arrival. The county has long expected to see about $342 million in tax revenues from Amazon as it develops the new headquarters over the next 16 years.
O’Donnell added that the company would have to apply for the program like any other business.
Without the “Technology Zone” tax break, Amazon would also be responsible for paying $0.36 for every $100 of its gross receipts as part of the BPOL tax. Should it earn eligibility for that program, the company could see the rate cut in half if it can prove it employs up to 499 people in “business units with a primary function in the creation, design and/or research and development of technology hardware or software,” according to county documents.
If Amazon can show it employs up to 999 people for those purposes, it could pay a rate of $0.14 per $100 of receipts. If the company exceeds 1,000 employees, it would pay $0.10 for every $100.
The company hasn’t settled on the exact mix of job functions for the 25,000 to 38,000 employees who could someday call the Arlington headquarters home — Holly Sullivan, the company’s worldwide head of economic development, said at an event in Arlington last week that she anticipates a “50-50” split between tech workers and other staff on the campus, making it a pretty safe bet that Amazon could meet the program’s standards.
The potential size of the company’s tax savings also remains a bit murky. County documents estimated that the “Technology Zone” savings “are equivalent to approximately $2 to $3 per square foot in building occupancy costs annually.”
Kasia Tarczynska, a research analyst with Good Jobs First, an advocacy group studying the Amazon deal, says that the savings are difficult to estimate, but she suspects it would work out to “a lot of money because of the size of the project.”
And Tarczynska adds that this is the first she’s heard of Amazon being eligible for the tax break. The head of Good Jobs First, vocal Amazon critic Greg LeRoy, agreed with her assessment.
Many of Amazon’s local opponents were similarly surprised to hear the news that the company could reap the tax savings, particularly given the frequent assurances from county leaders that Amazon would help relieve the recent strain on Arlington’s finances.
“In all of the numerous meetings I’ve been to with the [County Board], they have never once mentioned the tech zone incentive,” said Roshan Abraham, an anti-Amazon organizer with Our Revolution Arlington.
Tarczynska says that such a tax break “is a common subsidy in the region” — neighboring Fairfax County has a similar program — yet Arlington has regularly seen anemic participation in the program.
When ARLnow last investigated the program in 2015, just eight businesses were currently taking advantage of it. These days, O’Donnell says the county has recorded approximately 70 businesses participating in the program since it began.
A rendering of Amazon’s planned development at the “PenPlace” site in Pentagon City
Future Amazon HQ2 / Metropolitan Park location in Pentagon City as seen in March of this year (Staff photo by
Arlington officials have, at last, unveiled a detailed version of the county’s proposed incentive package designed to bring Amazon to the county.
A draft copy of the county’s “Economic Development Incentive Grant Agreement” posted online for the first time today (Tuesday) sketches out the exact amount of office space Amazon will need to occupy in Arlington in order to win $23 million in incentive cash over the next 15 years.
The agreement also reveals additional details about how the county plans to work with the company to add infrastructure improvements in the Crystal City and Pentagon City neighborhoods, which Amazon hopes to soon call home, and lays out the procedure for either side canceling the incentive arrangement.
County staff are unveiling the incentives agreement 11 days before the County Board is set to vote on the deal, the last hurdle for the company to clear before it can start to officially set up shop in Arlington. Gov. Ralph Northam signed off on $750 million in state incentives for the company last month, amid persistent complaints from critics on both sides of the political aisle that government officials shouldn’t dole out grants to a company run by the world’s richest man — proponents of the deal argue that the incentives are well worth it, given Amazon’s potential to send hundreds of millions to county coffers in tax revenues.
Notably, Amazon has agreed to only use the incentive money to build its new Arlington facilities, including any expenses associated with “construction,” and “furniture, fixtures and equipment.”
Under the terms of the proposed deal, Amazon will need to lease 60,000 square feet of space in the county by June 30, 2020 to start qualifying for the cash. Arlington plans to draw the money from an expected increase in revenue from a tax on hotel stays, with Amazon’s arrival projected to juice hotel tax revenues in the area.
That office space occupancy target jumps to more than 567,000 square feet by 2021, and regularly creeps upward from there. By 2026, when the company expects to have new buildings built near Metropolitan Park in Pentagon City, Amazon will need to occupy about 1.8 million square feet of space. By 2028, when its new buildings at the former “PenPlace” site are set to be ready, it will need to hit a 2.69 million-square-foot target.
The timeline included in the incentive agreement tops out with a 6 million-square-foot target in 2035. The company has said it intends to build and lease a minimum of 4 million square feet in the county, and could reach 8 million square feet by the time it reaches its peak of roughly 38,000 employees stationed at the new headquarters.
