Details about Scott County bids for Amazon headquarters released

By Mike Kaszuba

A Scott County group has released details on two sites that were submitted in the national competition to land Amazon’s second corporate headquarters – a move that comes as officials in Minnesota continue to keep the state’s overall bid private.

The sites included a parcel of more than 200 acres in Shakopee surrounding the Canterbury Park horse-racing track, and a 125-acre property along Interstate 35W near Elko New Market.  An 11-page proposal showed that Shakopee was “willing to discuss” a public subsidy package that included tax increment financing and an offer to write down land acquisition costs.  While the plan did not include a specific dollar amount, it added that it was “highly likely that an incentive package that benefits Amazon and Shakopee as partners can be negotiated.”

Shakopee’s offer also suggested that the owners of Canterbury Park would consider a unique partnering with Amazon.  One idea would give Amazon’s employees access to the horse racing track’s infield as “an open space that can be used for recreation, events or just to enjoy watching horses train.”

The Elko New Market plan offered Amazon the possibility of deferred city fees, tax-increment financing, tax abatement, a reduction in water rates, and also the suggestion that the city would “provide for the extension of sanitary sewer and water” for the project.  Elko New Market’s offer, which included few specific dollar amounts, also floated the prospect of assessing special fees for the project.

Both bids were obtained by Public Record Media (PRM), a Saint Paul-based non-profit, and are part of an overall effort to seek details about the unsuccessful attempt by state and local officials to convince Amazon to build a corporate headquarters in Minnesota.  The proposals were released by First Stop Shop, a business development arm of the Scott County Community Development Agency.

Amazon’s headquarters competition

Seattle-based Amazon announced a national competition last September in which local governments would vie to be chosen for the company’s new headquarters.  The move led many local governments to offer substantial public subsidy packages, but Governor Mark Dayton said that Minnesota’s attempt to lure Amazon – which had $43.7 billion in global sales in the third quarter of last year – would be “restrained.”

No Minnesota sites were listed last month as finalists by Amazon, which reported that it had received 238 proposals from across North America.

However, the Minnesota Department of Employment and Economic Development [DEED] and Greater MSP, a business promotion non-profit that submitted Minnesota’s bid on the state’s behalf, have continued to keep the details of the state’s overall bid private.  PRM has renewed requests that the bid details be released, but Greater MSP has so far refused to do so, claiming that Greater MSP is not a government entity and is thus not subject to Minnesota’s data disclosure laws. Both parties are now represented by counsel.

Shakopee’s Amazon proposal

Shakopee’s proposal for Amazon noted that the site – which is occupied by the horse-racing track — had the capacity for more than 10 million square feet of useable space “if each ‘block’ was built to four stories high.”  It added: “We know you love your Seattle HQ, we see a lot to love about it as well!  We’d like to take the best of what you have in Seattle and mix it with some Minnesota to create a thriving innovation district with Amazon as an anchor.”

The proposal added that “this location will serve as a launch pad for startups and an accelerator, especially for companies that can distribute through Amazon.”

“Amazonians and your guests would also have the benefit of Canterbury Park right next door,” the plan stated, while noting that Canterbury Park prepared the conceptual drawings for the Amazon project.  “Imagine being able to go cross country skiing or snow shoeing there in the winter?  Or moving a meeting outside into the greenspace?”   The proposal included pictures of horses racing at Canterbury Park under blue skies.

The development area, dubbed the Canterbury Innovation District, would also be near an existing Amazon warehouse facility that received public subsidies – a point the city repeatedly emphasized in its bid for Amazon’s corporate headquarters.

That city’s existing Amazon facility was built after the company received public money from local officials.  According to a cooperative agreement signed in 2016, Shakopee and Scott County spent $5.7 million – mostly for roadway improvements surrounding the new warehouse.  Separately, Amazon also received sewer access charge credits – valued at $183,520 – in return for the company’s promise to create a minimum of thirteen full-time jobs within two years of finishing the building.  Amazon also had to promise that the jobs would pay at least $14.50 an hour, “exclusive of benefits, if any.”

However, in a one-sentence explanation part way through its latest proposal, Shakopee did acknowledge that there might be limits to its financial help in building a corporate headquarters for Amazon.

“The total value of the incentives the City of Shakopee would be able to consider is the total amount of the tax increment captured by the new development,” the city stated.

Shakopee’s pitch for the corporate headquarters took note of the proximity of Amazon’s new warehouse. “We’d like to point out that this site is right next to a brand-new Amazon Fulfillment Center and just over a mile from an Amazon Sort Center.  Imagine the possibilities with HQ2 [the new corporate headquarters] so close to two key facets of your operation!” the proposal stated.

“Much of the property is currently vacant land, and can easily be prepared for this development,” the proposal added.  Locating a corporate headquarters near Canterbury Park, the city stated, could mean “building an innovation district that will rival any urban center in the world.”

Shakopee also noted that Amazon was already involved with the local school system.  “The generosity of companies like Amazon allows us to help students at all levels from K students with iPads to Junior High students with laser cutting machines (donated by Amazon),” the city’s presentation stated.

Shakopee officials pointed out that the city’s 64.5 percent increase in employment over the past 16 years included “many [new employees] which are with Amazon!”

Elko New Market proposal

Elko New Market’s proposal meanwhile emphasized a site location alongside a major freeway – Interstate 35W – “which stretches from Texas to Canada.”

The Elko New Market bid focused on a parcel near County Road 2, just south of the Twin Cities.  According to documents provided to PRM, the parcel was under contract at the time with local developer Ryan Companies.  The proposal included a picture of the undeveloped property, with a sign superimposed alongside it that read “HQ2 Campus Amazon Here.”

The city’s plan advised Amazon that there was already a layout in place to reconstruct a nearby freeway interchange.  In addition, the proposal stated that Elko New Market had prepared construction plans to extend water to the property – a project estimated to cost $2.08 million – and also had plans to bring sanitary sewers to the parcel in a separate project, estimated at $1.37 million.  Although the proposal did not specifically state that the city would pay for both projects, it added that “the city will extend water to the site for the Amazon HQ2 Project within the time frame required.”

The Elko New Market proposal – like the Shakopee plan – stressed to Amazon that the city could quickly get the governmental approvals necessary for the project.

“The property is currently located in New Market Township and would require annexation prior to development,” the city’s proposal stated.  “An approved annexation agreement is in place; annexation could be completed in 30-45 days.”

The proposal also stated that rezoning the parcel could take 60 days, and would require a city planning commission recommendation and City Council approval, but noted that the process could “run concurrently with preliminary plat and variance application.”

The proposal likewise highlighted the fact that, in 2007, Scott County had started constructing “the largest government-owned high-speed [fiber] network at that time in the state.”

“Scott County’s fiber network has direct connections capable of providing diverse and redundant 10 gigabit [or even greater gigabit] capacities out of the region as well as to multiple Tier III and Tier IV data centers in the region including the Capitol campus in St. Paul and to the 511 building in downtown Minneapolis, which in turn provides a portal to the world,” Elko New Market’s proposal stated.

Appealing to the “Amazonians”

Shakopee’s plan made direct appeals to Amazon’s employees, which it called “Amazonians.”

“If they want the lake life, we have 6 lakes in Shakopee, Prior Lake and Lake Minnetonka nearby,” the proposal said of local housing options.  “If they want suburban lifestyle, Shakopee and our neighboring communities have plenty of available housing options and more to come!  If they want a house and a 40-acre hobby farm – they only need drive 30 minutes to the south to find reasonably priced land and good homes.”

Both Elko New Market and Shakopee also stressed their proximity to local attractions.  “Shakopee is also the epicenter of ‘the Land of Big Fun’, which includes Valleyfair Amusement and Waterpark, Mystic Lake Casino, the Renaissance Festival, and Canterbury Park.  There are always community events going on in town that are well attended,” the city’s bid stated.

Elko New Market noted, in addition, that the Buck Hill ski facility was close by, which is “where American World Cup alpine ski racer Lindsey Vonn learned to ski.”