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Chicago makes first cut for second Amazon headquarters

Amazon on Thursday released a list of 20 finalists in the competition for the company’s second North American headquarters — and as expected, Chicago is on the list.

The others making the cut are: Atlanta; Austin, Texas; Boston; Columbus, Ohio; Dallas; Denver; Indianapolis; Los Angeles; Miami; Montgomery County, Md.; Nashville; Newark, N.J.; New York City; Northern Virginia; Philadelphia; Pittsburgh; Raleigh, N.C.; Toronto; Washington D.C.

“Thank you to all 238 communities that submitted proposals. Getting from 238 to 20 was very tough – all the proposals showed tremendous enthusiasm and creativity,” Amazon’s Holly Sullivan was quoted as saying in a company news release. “Through this process we learned about many new communities across North America that we will consider as locations for future infrastructure investment and job creation.”

According to Amazon, the company now “will work with each of the candidate locations to dive deeper into their proposals, request additional information, and evaluate the feasibility of a future partnership that can accommodate the company’s hiring plans as well as benefit its employees and the local community.”

The Chicago area’s bid for Amazon’s second North American headquarters includes $2.25 billion worth of incentives — and even more if the company chooses the Thompson Center or the old Michael Reese Hospital site where the city and state could provide free land.

The incentive package includes:

  • Roughly $1.4 billion in state EDGE tax credits. The newly-revised program provides a 50 percent tax break for every job they create in Illinois.
  • $170 million in state sales tax breaks for building materials purchased by and new construction completed by “high-end businesses.”
  • $60 million in property tax breaks through the city and county programs known as Class 7B and 7C.
  • $450 million in site-specific infrastructure improvements that would come from the Illinois Department of Transportation, the Chicago Department of Transportation, the CTA and other agencies.
  • $250 million worth of investments in education, workforce development and “Neighborhood Opportunity Funds” to make certain that all Chicagoans can qualify for the 50,000 high-end Amazon jobs and that businesses that spring up or move here to support Amazon locate in Chicago neighborhoods.
  • Free land worth $100 million, if Amazon chooses to build its second headquarters at the old Michael Reese Hospital site purchased by former Mayor Richard M. Daley as the site for an Olympics Chicago didn’t get. If Amazon chooses either to re-purpose or demolish and rebuild the Thompson Center that the state has been trying desperately to sell, the free land would be worth even more money.

The incentive package pales by comparison to the $9 billion that New Jersey Gov. Chris Christie offered in hopes of luring Amazon to Newark.

But sources close to the negotiations view the package as a good-faith effort to lure the motherlode of all economic development projects and a far cry from the “corporate welfare” so many critics and gubernatorial candidates have decried.

Almost as significant as the incentive package is the fact that Gov. Bruce Rauner, Mayor Rahm Emanuel, County Board President Toni Preckwinkle and the four legislative leaders worked together to craft the bid. They’re all on the same page — for a change.

A final decision is expected sometime this year. The new headquarters will be a $5 billion investment, according to the company, and will eventually employ up to 50,000 people.

Contributing: Fran Spielman

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