A study of a Texas economic development incentive program finds that one in four companies renegotiate—typically in secret—the tax abatement dollars deals that they receive.
For New Yorkers, Amazon’s union-busting is a deal breaker.
On the same day Amazon decided to abandon its plans to establish a secondary headquarters in New York City, leaving behind $3 billion in publicly funded incentives, GE announced it would repay the city of Boston for almost $90 million in development incentives.
If a state gave grants to nonprofits but kept organization names, award amounts, and fund uses secret, it would be a scandal. But with corporations that receive state tax credits, this is business as usual. Some folks in Tennessee’s legislature, however, want this to change.
In East Baton Rouge, a local school board facing a shortage of funds to pay teachers opts out of a tax-abatement deal for ExxonMobil that would have cost local school coffers $2.9 million over 10 years.
Another study, a familiar outcome. This time, the focus is on Kentucky, where a study shows that state spending on corporate tax abatements is largely a waste of money, diverting resources that could support education and other public services.
Over $185 million in tax revenues have been redirected from Washington, DC’s city treasury to fund economic incentives for tech industry firms, but much of the money looks to have gone to firms already in the city without the incentives, a city audit finds.
In Nashville, the $102 million offered Amazon to locate a 5,000-person employee facility in the city is proving less than universally popular, with local unions and council members clamoring for the city, which has committed $15 million of that amount, to care for its own workers first.
While tax abatements for corporate relocation are widely known, another way to avoid taxes is to seek lower property tax rates based on “comparable” stores that are no longer in operation.
After a 14-month economic development scrum, Amazon will split its second headquarters between New York City and Washington, DC, potentially employing up to 25,000 in each city. Nashville, too, will get an operations center, which will employ 5,000. In exchange, Amazon is collecting nearly $3 billion in public subsidies.
