An Austin City Council member says the city is mishandling its pursuit of Amazon’s planned $5 billion second headquarters project by failing to be transparent about the process, which she says so far has kept even the City Council in the dark.
Council Member Leslie Pool says city leaders erred by having the Greater Austin Chamber of Commerce lead the region’s recruitment pitch for the Amazon project, which has been dubbed HQ2 and promises to bring 50,000 highly paid jobs to the city that wins it.
After receiving pitches from more than 230 cities, Amazon in January announced that Austin was one of 20 finalists for the HQ2 project. The Greater Austin Chamber of Commerce submitted the city’s proposal to Amazon on Oct. 18. Chamber officials said the bid was made on the behalf of not only Austin, but the other cities and counties in the metro area.
The chamber and city officials have refused to release any details of what was included in the application sent to Amazon. The city rejected an open records request from the American-Statesman, citing a section of the state’s open records law that allows an exemption for releasing information that could put the city at a competitive disadvantage.
Pool and some Austin civic leaders say the city and chamber are keeping Austinites in the dark about the process and about potential promises being made on their behalf. Pool said even City Council members have been given no details about what was in the initial application or about ongoing negotiations with Amazon.
“I know nothing about the Amazon bid. It appears none of my colleagues do either,” Pool said “I have been asking for some insight to what the proposal had, and I’ve been asking for six months. I find that extraordinary. It’s been mishandled by the chamber. If they thought about it, they would have realized this would have been an issue for the whole town, and they should have talked to us about what they can negotiate.”
Pool said she is concerned that, should Amazon choose Austin, the city “would be on the hook for significant infrastructure development. You would think we would need to be asked if we want to take on that financial burden.”
“This community is not ready for Amazon,” Pool said. “I think the City Council should have been briefed on what (the chamber) was pulling together. Is San Marcos involved? Is Hutto involved? They say they have submitted a bid for the Central Texas region. The chamber cannot speak for us. Absolutely, I’ve made that clear. They don’t have the authority.”
Civic activist Bill Aleshire, a local attorney and former Travis County judge, said the City Council “should have voted on whether to have the mayor invite Amazon to locate here.”
“Instead of an open process about whether to even invite Amazon here, you get a mayor who presumes he can speak for the council on such a big deal without even consulting the rest of the council, and a chamber of commerce who presumes it can claim ‘the city’ is making an offer when they have no legal authority to do so,” Aleshire said. “Secrecy does not lead to deals that are good for the folks who live here now.”
Aleshire and Pool raised similar concerns earlier this week in a story by the online Austin Bulldog, which reported how the City Council has not specifically discussed or authorized an Amazon bid and instead has relied on the arrangement that delegates that authority to the chamber.
Other city leaders, however, say the handling of the recruiting process is a nonissue. The chamber has long led the city’s efforts to recruit new business to Austin — and the chamber has no legal authority to reach any binding deals with Amazon on the city’s behalf, Mayor Steve Adler said.
“The chamber, they do this all the time for businesses big and small,” Adler said. “The chamber continues to have to give advice (to Amazon), but the chamber doesn’t get to make any offers. The City Council can’t authorize any offers without public notice. I think that when it’s appropriate to have those conversations, the city needs to get involved if it reaches that level.”
Adler has previously said the Amazon bid did not include any financial incentives from the city, and he released a letter he wrote to Amazon touting Austin’s qualities.
“A lot of people are asking questions because they believe the council is secretly negotiating. I’ve been really transparent with any conversation that I’m having,” Adler said. “I even wrote out a letter which laid out all of my thoughts.”
Mike Rollins, president and CEO of the Greater Austin Chamber of Commerce, said the way his organization has handled the Amazon application “is our regional standard practice for economic development projects.”
Included in the application, he said, was “general information about the processes that any company would need to adhere to regarding potential incentives in various government bodies. Each of these elected bodies have their own incentive policies, practices and programs that are set by each jurisdiction, not the chamber. All decisions on structuring or approving any incentive are reserved for the respective elected bodies at the appropriate time.”
Although the City Council has not been formally briefed on the pursuit of Amazon, Council Member Ann Kitchen said she has no issues about how the process has been conducted.
“There’s a role for the chamber to play. Part of what they do is help the city in the role of economic development. What they’re doing is what they’ve done in the past, and it does not commit the city in any way.” Kitchen said. “We have another process we use before we can do any economic incentives. What’s currently in place is a public input process and staff analysis of any kind of proposal before it even gets to the council for a vote. … There’s no proposal in front of us. There’s no proposal for the staff to analyze.”
In a written statement, Council Member Ora Houston said: “I was aware that there was interest in Austin for an Amazon headquarters, and that the Austin chamber was interested in bringing Amazon to Austin, beyond that I know what the media has reported. I am not sure what the process has been and didn’t see the letter from the mayor that some have referenced.”
Council Members Ellen Troxclair, Alison Alter, Delia Garza, Greg Casar, Sabino “Pio” Renteria and Kathie Tovo were either unavailable or did not respond to requests seeking comment.
Council Member Jimmy Flannigan said that, by allowing the chamber to handle early recruiting discussions with companies such as Amazon, city staff are freed to work on their other responsibilities.
“This is how the process works,” Flannigan said. “There’s nothing nefarious about the chamber talking to a company. There’s no lacking transparency with the chamber having a conversation with Amazon. It’s how these things go. We don’t open up really any negotiating process until we’ve reached the end.”
And if Amazon does, in fact, choose Austin for its HQ2 project and the City Council members don’t like what the retail giant was asking for, there is a simple fix, Flannigan said.
“Then we’ll vote no,” Flannigan said. “We always have that ability to vote no.”
Additional material from American-Statesman staff writers Gary Dinges and Lori Hawkins.