Economic Development

 Amazon Bid Made Without Council Okay

Claim city’s contract with Chamber permits
bid on City’s behalf is questionable

Investigative Report by Ken Martin
© The Austin Bulldog 2018
Posted Tuesday February 27, 2018 7:27pm

All that’s known publicly is that Austin’s proposal was good enough to keep it in the running to be home to a second headquarters of the company founded by Jeff Bezos, now reportedly the Richest Man in the World.

Its hardly news that Austin is one of the finalists among 20 U.S. and Canadian cities whose proposals have earned a shot at attracting what Amazon calls its HQ2—and with it up to 50,000 high-paying jobs and $5 billion in construction expenditures.

The Request for Proposals the company issued last September nevertheless indicates the Richest Man in the World is looking for a long list of incentives before deciding where to invest that fortune.

Now it has come to light that the proposal designed to harpoon this Moby Dick of an economic development opportunity was put together—apparently with the City’s tacit approval—by the Greater Austin Economic Development Corporation. That’s an entity within the Greater Austin Chamber of Commerce that works on the Opportunity Austin program. The City of Austin has been the major funder of Opportunity Austin since 2005.

The Austin Bulldog’s investigation indicates that while the mayor and some City Council members were aware the Chamber was heading up this effort, the City Council never discussed authorizing that action, not in a public meeting and not in executive session.

Did the City delegate authority for Amazon bid?

The Arizona Republic, that state’s largest newspaper, yesterday reported that Phoenix was never in the running to attract the Apple Inc. facility for which Texas has committed tax incentives, and both Austin and Travis County are considering doing likewise.

Governor Rick Perry is offering Apple $21 million in incentives over 10 years and the City of Austin is considering sweetening the deal with $8.6 million, according to the Austin American-Statesman. Travis County is also considering incentives.

Those incentives were based on the premise that Apple was considering Phoenix and Austin.

However, The Arizona Republic’s story published yesterday reported Phoenix “never had a chance” because the proposed site was on state land and “state trust land did not excite them” (Apple), so there was no Phoenix site reasonably in contention.”

by Ken Martin
© The Austin Bulldog 2011

Three Austin taxpayers filed a lawsuit today to stop State Comptroller Susan Combs from paying state tax money to the promoters of Formula One racing in Austin.

The lawsuit filed in state district court may affect the Austin City Council's action scheduled for tomorrow to enact ordinances that would otherwise enable the comptroller to make the payments.

Race promoters have publicly stated that the comptroller’s payment must be made in July for the race to take place.

Combs jumped on the opportunity for the race before consulting with the City of Austin or Travis County. In fact, Combs issued a letter to Formula One World Championships Limited on May 10, 2010, to certify that, “With the understanding that the first Formula 1 United States Grand Prix will be held in Texas in 2012, full funding of the entire sanction (fee) for 2012 will be paid to Formula One World Championship Limited (FOWC) no later than July 31, 2011. In subsequent years, two through 10, of the race promotion contract, i.e., 2013 through 2021, we will be sending $25 million to FOWC by the end of July 31 of each year preceding the actual race event.”

As a result of the comptroller’s early commitment, and the extreme lateness in approaching the City of Austin to sign on as the sponsoring municipality, the city is under the gun to approve contracts and is scheduled to consider doing so at tomorrow’s council meeting. The economic study that projects tax revenue to be derived from the race was not delivered until late Monday.