D.C.-area Ama­zon could be boon, bane

Jobs, tax rev­enue hard to re­sist, but many fear traf­fic, high hous­ing costs

The Washington Post Sunday - - FRONT PAGE - BY ROBERT MCCART­NEY AND KATHER­INE SHAVER

Stephanie Lan­drum, a leader of Alexan­dria’s quest to lure Ama­zon.com’s se­cond head­quar­ters to the city, prom­ises that a pro­posed site in Po­tomac Yard could han­dle an in­flux of up to 50,000 jobs.

“We only of­fer them stuff where they could fit,” said Lan­drum, who calls her­self the “sales­per­son for the city” as pres­i­dent of the Alexan­dria Eco­nomic De­vel­op­ment Part­ner­ship. “The scale of what has al­ready been ap­proved there [for de­vel­op­ment] is dense.”

Many res­i­dents of the nearby Del Ray neigh­bor­hood are skep­ti­cal. They al­ready suf­fer daily rush-hour back­ups that slow traf­fic to a crawl. They fear the ex­tra con­ges­tion from Ama­zon would erode the qual­ity of life in their com­mu­nity of mostly sin­gle­fam­ily homes.

“I can’t imag­ine a se­ri­ous pro­posal to do this,” res­i­dent David Hal­wig said. “The Po­tomac Yard area is al­ready chal­lenged by traf­fic.”

Verenda Camire, who has lived in Del Ray for 30 years, said: “The

upside: Those of us with good fam­ily homes nearby might en­joy a price hike. The down­side: We would be pris­on­ers in those homes for hours each day.”

The di­ver­gent views of booster and home­owner il­lus­trate a broader de­bate about whether and how the Washington re­gion could ab­sorb the growth that Ama­zon would bring. Even en­thu­si­asts ac­knowl­edge that suc­cess in the con­test to host the com­pany’s se­cond head­quar­ters — HQ2 — would have pos­i­tive and neg­a­tive ef­fects.

Elected of­fi­cials and other civic lead­ers are giddy at the prospect of se­cur­ing the jobs and an es­ti­mated $5 bil­lion in­vest­ment that the Seat­tle-based on­line re­tail gi­ant says it will make. Vic­tory would yield an es­ti­mated $763 mil­lion a year in additional tax rev­enue, ac­cord­ing to a Mary­land study. It would di­ver­sify the re­gion’s econ­omy and bring the pres­tige of land­ing the big­gest de­vel­op­ment prize in a gen­er­a­tion.

Northern Vir­ginia, the District and Mont­gomery County are among the 20 fi­nal­ists. Ama­zon may nar­row the list fur­ther in coming months and is ex­pected to de­cide by the end of the year.

But many res­i­dents fear that win­ning the prize would ac­tu­ally ex­ac­er­bate all the things they hate about liv­ing in the re­gion: hor­ren­dous traf­fic, ex­pen­sive hous­ing, crowded schools and gen­tri­fi­ca­tion. The area con­sis­tently ranks near the top in sur­veys of the na­tion’s worst traf­fic con­ges­tion. It has failed to keep up with de­mand for low- and moder­ate-priced hous­ing — a chal­lenge that also con­cerns Ama­zon, ac­cord­ing to lo­cal de­vel­op­ment of­fi­cials who have spo­ken with the com­pany’s rep­re­sen­ta­tives.

The com­pany’s ar­rival is pro­jected to add be­tween 300,000 and 1 mil­lion res­i­dents to the re­gion over 10 to 15 years, of­fi­cials said. The range is so large partly be­cause of un­cer­tain­ties about how many Ama­zon jobs would be filled by peo­ple al­ready liv­ing here, the size of fam­i­lies of em­ploy­ees who would re­lo­cate, and how many com­pa­nies would move here to be close to Ama­zon in a pos­i­tive “con­ta­gion ef­fect.”

(Ama­zon chief ex­ec­u­tive Jef­frey P. Be­zos owns The Washington Post.)

Plan­ners at the Met­ro­pol­i­tan Washington Council of Gov­ern­ments (COG) con­ser­va­tively project a gain of 390,000 res­i­dents, even with­out any “con­ta­gion” im­pact.

Fewer than half — about 130,000 — would be Ama­zon em­ploy­ees and their fam­ily mem­bers. The re­main­ing 260,000 would be house­holds of peo­ple fill­ing jobs gen­er­ated by fresh eco­nomic ac­tiv­ity spun off by Ama­zon, ac­cord­ing to the COG. They would in­clude out­side con­trac­tors hired by the re­tailer, con­struc­tion work­ers who build Ama­zon work­ers’ homes and ho­tel staffers who serve vis­i­tors to the head­quar­ters.

By 2040, the new ar­rivals would add an es­ti­mated 87,000 K-12 stu­dents to the ap­prox­i­mately 800,000 stu­dents now en­rolled in the re­gion’s schools, ac­cord­ing to the COG plan­ners.

‘Unprecedented’

Supporters of the Ama­zon bid say the re­gion as a whole can han­dle the im­pact. They note that the Washington met­ro­pol­i­tan area’s pop­u­la­tion of 6.1 mil­lion is con­sid­er­ably larger than Seat­tle’s 3.7 mil­lion, so the additional peo­ple here would be a com­par­a­tively smaller bur­den. Ama­zon em­ploys more than 40,000 at its Seat­tle head­quar­ters.

But the im­pact on any in­di­vid­ual site cho­sen within the re­gion could be stag­ger­ing. Lo­cat­ing Ama­zon at the site pro­posed in Mont­gomery, for ex­am­ple, would in­crease the county’s workforce by 10 per­cent.

“You can’t over­hype the im­pact of 50,000 jobs land­ing in one ju­ris­dic­tion — it’s com­pletely unprecedented,” said for­mer Mont­gomery County Council mem­ber Steven A. Sil­ver­man, a con­sul­tant who also served as the county’s eco­nomic de­vel­op­ment di­rec­tor.

Ama­zon’s as­ser­tion that its jobs would pay an av­er­age salary of $100,000 a year, while al­lur­ing to pro­mot­ers, raises con­cerns among District politi­cians and ac­tivists wor­ried about widen­ing the dis­par­ity be­tween the city’s haves and have-nots.

“I see a lot of po­ten­tial neg­a­tives, of which the big­gest is ex­ac­er­bat­ing gen­tri­fi­ca­tion and dis­place­ment, which is al­ready over­whelm­ing the District,” said D.C. Council mem­ber Robert C. White Jr. (D-At Large). “If we put that on steroids, I’m not sure what that means for lower- and lower-middle-class Wash­ingto- ni­ans.”

The Rev. H. Lionel Ed­monds, a founder of the Washington In­ter­faith Net­work, warned against cre­at­ing “a mil­len­ni­als’ oa­sis, a lit­tle Ama­zon is­land of these folks making $100,000 a year, sur­rounded by peo­ple making less than half of that, or even a third of that.”

An an­nounce­ment that Ama­zon had picked the re­gion would trig­ger spec­u­la­tion that would drive up home prices and rents, an­a­lysts said.

“We’re al­ready see­ing high rents and high home prices, and we don’t have enough hous­ing for the num­ber of peo­ple we ex­pect in the next five to 10 years, even with­out Ama­zon,” said Yolanda Cole, who owns a D.C. ar­chi­tec­tural firm and chairs ULI Washington, part of the Ur­ban Land In­sti­tute. “We’re talk­ing about a lot of hous­ing that would need to hap­pen.”

The re­gion will need 491,000 new hous­ing units by 2032 to match job growth, ac­cord­ing to the Washington Lawyers’ Com­mit­tee for Civil Rights and Ur­ban Af­fairs.

Lo­cal gov­ern­ments say they would have more money to ad­dress traf­fic, hous­ing and other chal­lenges aris­ing from HQ2, be­cause of the rev­enue gen­er­ated by Ama­zon em­ploy­ees’ ex­pan­sion of the lo­cal tax base. But state and lo­cal gov­ern­ments are ex­pected to give back bil­lions of dol­lars of that prospec­tive wind­fall in in­cen­tives to at­tract the com­pany.

To woo Ama­zon, Mary­land and Mont­gomery County, for ex­am­ple, are of­fer­ing in­come, property and new-jobs tax cred­its and other fi­nan­cial in­cen­tives, plus trans­porta­tion im­prove­ments to­tal­ing up to $8.5 bil­lion.

It’s worth it, of­fi­cials say, be­cause a state-com­mis­sioned study by the an­a­lyt­ics firm Sage Pol­icy Group says the even­tual net im­pact would be an in­crease in state tax rev­enue of $483 mil­lion a year and county re­ceipts of $280 mil­lion a year.

The District and Vir­ginia have kept se­cret the scale and type of in­cen­tives they are of­fer­ing Ama­zon.

Some of­fi­cials and res­i­dents say the com­mon in­ter­est in at­tract­ing Ama­zon would galva- nize the re­gion to over­come any chal­lenges. For ex­am­ple, a de­sire to sat­isfy Ama­zon helped rally Vir­ginia, Mary­land and the District to agree this year on a ded­i­cated funding plan for Metro that had been sought with­out suc­cess for more than 40 years.

“It doesn’t do Ama­zon any good just from a prac­ti­cal stand­point to lo­cate in a place where traf­fic gets sig­nif­i­cantly worse or schools get worse or no one can get on a Metro train be­cause it’s so crowded,” said Heather Arnold, re­search di­rec­tor for Street­sense, a Washington-area con­sult­ing firm that as­sisted with sev­eral Ama­zon bids. “While we’ve been wrestling with these is­sues, I think we’ve lacked the im­pe­tus to deal with them in a com­pre­hen­sive way. It might just give us the kick in the pants that we need.”

Ama­zon as a neigh­bor

The three Washington-area ju­ris­dic­tions on Ama­zon’s short­list are of­fer­ing a to­tal of nine sites: four each in Northern Vir­ginia and the District and one in Mont­gomery.

In Vir­ginia, three are in the D.C. sub­urbs of Alexan­dria and Ar­ling­ton: Po­tomac Yard-Crys­tal City, a joint bid by Alexan­dria and Ar­ling­ton; Eisen­hower Av­enue in Alexan­dria; and the Ross­lyn-Ball­ston cor­ri­dor in Ar­ling­ton.

The fourth, a joint bid by Fair­fax and Loudoun coun­ties, is out­side the Cap­i­tal Belt­way, in Hern­don, at the site of the Cen­ter for In­no­va­tive Tech­nol­ogy near Dulles International Air­port.

The District’s sites are Navy Yard-Ana­cos­tia, near Na­tion­als Park; Hill East, near RFK Sta­dium; the NoMa neigh­bor­hood, near Union Sta­tion; and U Street near Howard Univer­sity.

Mont­gomery’s site is at White Flint, just out­side the Belt­way, be­tween down­town Bethesda and Rockville.

Some res­i­dents would be happy to have Ama­zon as a neigh­bor, but only if cer­tain con­di­tions are met.

Mandi Mader, a so­cial worker who lives in Mont­gomery, said she would wel­come new of­fice build­ings to re­place the “gi­ant open pit” left by the de­mol­ished White Flint Mall, as long as they were “com­mu­nity friendly” with green space, restau­rants, shops and other ameni­ties that the pub­lic could use. But she’s also a bit leery. “Is the idea that if they choose the [White Flint] site, we’d have to just wel­come them in?” Mader said. “Would Ama­zon be a good neigh­bor and help the com­mu­nity?”

Lind­say McGar­ity, who lives be­hind the White Flint site, hopes clinch­ing the cor­po­rate gi­ant would speed up pub­lic in­vest­ments to ex­pand schools, make Metro more re­li­able, build a new rapid bus line on Rockville Pike and make the area more walk­a­ble.

“If Ama­zon coming here would get those prob­lems ad­dressed sooner, then great,” said McGar­ity, who chairs the res­i­den­tial rep­re­sen­ta­tives of the Friends of White Flint. “I think ev­ery­one is aware it would bring some chal­lenges and grow­ing pains, but I think the net-net would be ab­so­lutely pos­i­tive.”

In Alexan­dria, IT con­sul­tant Pa­trick B. Mc­N­abb hopes Ama­zon will come and im­prove the qual­ity of the re­gion’s tech­nol­ogy com­mu­nity.

Most of the gov­ern­ment tech­nol­ogy jobs here now are “fairly pedan­tic” and “not very exciting or ful­fill­ing for young peo­ple,” Mc­N­abb said. By con­trast, Ama­zon is “kind of lead­ing the charge into cloud com­put­ing,” he said. “The kinds of jobs they would pro­vide would be a shot in the arm for the whole re­gion.”

The Rev. Frankey Gray­ton lives seven blocks from the Hill East site in the District. He could sup­port Ama­zon’s ar­rival as long as the com­pany hired work­ers from the neigh­bor­hood and took steps to en­sure that higher rents did not force res­i­dents out.

“Peo­ple want to see the city de­velop, but we do not want to be dis­placed,” said Gray­ton, pas­tor of Edge­wood Bap­tist Church.

He noted that many res­i­dents or their rel­a­tives have years of ex­pe­ri­ence with of­fi­cial build­ings lo­cated at Hill East, which has been the site of a pri­son, a hospi­tal and now the D.C. Gen­eral home­less shel­ter.

“The cit­i­zens who have used those fa­cil­i­ties over the years . . . don’t want to be left out of the rede­vel­op­ment,” Gray­ton said.

Pri­or­i­tiz­ing growth

“I see a lot of po­ten­tial neg­a­tives, of which the big­gest is ex­ac­er­bat­ing gen­tri­fi­ca­tion and dis­place­ment, which is al­ready over­whelm­ing the District.” D.C. Council mem­ber Robert C. White Jr. (D-At Large)

With or with­out Ama­zon, the Washington re­gion is ex­pected to grow in coming years. Ac­cord­ing to re­cently up­dated pro­jec­tions by the Ur­ban In­sti­tute, the re­gion is fore­cast to gain 843,000 res­i­dents from 2020 to 2030.

That’s based on cur­rent trends, the area’s at­trac­tive­ness to po­ten­tial in­vestors and the fact that Washington’s core in­dus­try — the fed­eral gov­ern­ment — won’t be­come ob­so­lete, ac­cord­ing to Rolf Pen­dall, a fel­low and re­searcher at the in­sti­tute.

Lo­cal of­fi­cials em­pha­size that they are al­ready pre­par­ing to ac­com­mo­date more res­i­dents, even if Ama­zon’s ar­rival greatly ac­cel­er­ates the trend.

“There’s a nar­ra­tive that Ama­zon is going to cause all of this Sturm und Drang around things, and I have to re­mind my­self and other peo­ple that we are a grow­ing city, so our pri­or­i­ties are on growth,” said Brian T. Ken­ner, D.C.’s deputy mayor for plan­ning and eco­nomic de­vel­op­ment. “This isn’t new to us . . . . We’re going to ex­pe­ri­ence that growth no mat­ter what.”

Ken­ner sought to re­as­sure res­i­dents that what­ever in­cen­tives the city of­fered Ama­zon to lo­cate in the District, the re­turn would be many times greater.

“When we think about in­cen­tives, we think that if we’re going to pro­vide you with some­thing, we need at least four to five times that back in ei­ther tax rev­enue or some other quan­tifi­able value,” Ken­ner said.

The lat­ter ben­e­fits could in­clude small-busi­ness op­por­tu­ni­ties, men­tor­ships and sum­mer youth jobs, he said.

Sil­ver­man, the for­mer Mont­gomery eco­nomic de­vel­op­ment chief, and oth­ers said any lo­cal gov­ern­ment would do a de­tailed analysis of the fi­nan­cial im­pact to sup­port ben­e­fits of­fered to woo the com­pany.

“No politi­cian would pro­pose these kinds of num­bers un­less their in­ter­nal num­bers showed a net pos­i­tive,” Sil­ver­man said. “They tend to be pretty ac­cu­rate. . . . No­body gets in the game un­less it pen­cils out.”

But Camire, the Del Ray res­i­dent eye­ing the Alexan­dria traf­fic jams, is not con­vinced.

“Per­haps plan­ners have found a so­lu­tion to the choke points,” she said. “But the only so­lu­tion I can see calls for the wide­spread use of in­di­vid­ual jet packs.”

PHOTOS BY ASTRID RIECKEN FOR THE WASHINGTON POST

Alexan­dria res­i­dent Verenda Camire is con­flicted about an Ama­zon com­plex in the vicin­ity. “The upside: Those of us with good fam­ily homes nearby might en­joy a price hike,” she said. “The down­side: We would be pris­on­ers in those homes for hours each day.”

Pa­trick Mc­N­abb, seen at home in Alexan­dria, works as an IT con­sul­tant and en­joys play­ing the trom­bone, and he sup­ports the idea of Ama­zon’s se­cond head­quar­ters be­ing in the D.C. re­gion. He fore­sees a pos­i­tive im­pact on the lo­cal econ­omy and com­mu­ni­ties.

Source: Map­s4News.com/HERE THE WASHINGTON POST

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