After more than a year, Amazon bid released

By Mike Kaszuba

After being kept from the public for over eighteen months, Minnesota’s unsuccessful bid to have Amazon locate a second corporate headquarters (“HQ2”) in the state was released on May 6th.  The bid document, however, contained few surprises – many of the public subsidies and locations that were offered to the company had previously been disclosed.

The release of the 122-page bid for the Amazon HQ2 proposal came nearly a year after Saint Paul-based non-profit Public Record Media (PRM) sued to force disclosure of the document.  The bid’s front page contained joint branding from both Greater MSP, a  regional economic development non-profit, and the Minnesota Department of Employment and Economic Development (DEED).

Although a Minnesota district judge had sided with attempts to keep the bid private, a Minneapolis Star Tribune opinion piece written by Greater MSP CEO Peter Frosch stated that “important facts have changed” and that Amazon had “recently confirmed” that it would not oppose the bid’s release.  For its part, DEED had long maintained that despite working closely to assemble the document, it never had a copy of the final bid.  In releasing the bid Monday, a spokesman for DEED stated that “DEED recently received a copy of the completed proposal, which makes the document public data.”  

E-mails that PRM obtained from DEED in 2018 indicate that the state agency had joint access to a “Box” file-sharing portal maintained by Greater MSP, in which Amazon bid material was housed.  Access to bid data contained within the on-line portal became a matter of contention in PRM’s litigation, with state agency DEED arguing that such data was not subject to the Data Practices Act – the state’s open records law.

The release of the Amazon bid came two months after PRM filed a notice of appeal in the case, challenging a district court dismissal order.  In March, the Minnesota Court of Appeals granted twelve organizations and individuals permission to file friend-of-the-court briefs in support of PRM’s appeal.

While PRM welcomed the bid’s release on Monday, representatives of the non-profit said they were reviewing options to ensure that future partnerships between public and private entities in Minnesota did not lead to violations of the Data Practices Act.

Bid document shows collaboration between DEED and Greater MSP

The bid document itself provided few clues as to why Greater MSP and DEED had fought to keep the final bid private.  Although the document outlined specific public subsidy options and locations, documents previously obtained by PRM from the state agency through public data requests had revealed many of the same details.

The document did show that DEED, which maintained that Greater MSP submitted the bid on the state’s behalf, was an integral player in the proposal, and that its partnership with Greater MSP was complicated.  On its last page, the bid concluded with the words: “If you’re looking for a stronger connection with those who matter most to you, connect with us first” – and listed two contacts, one from Greater MSP, and also DEED staffer Kevin McKinnon.  But below McKinnon’s name were the added words: “Confidential © 2017 Greater MSP.”

A letter signed by then-Governor Mark Dayton and other state political leaders – the bid’s first substantive page – also attested to the state’s involvement with the bid. “On behalf of the State of Minnesota we are proud to submit our state’s response to Amazon’s call to establish a second corporate headquarters in North America,” the letter to Amazon founder Jeff Bezos began.

Substance of the bid

The bid showed that while Minnesota did not offer large sums of public money to lure Amazon – Dayton had early on indicated that state officials would not do so – the document tried to sell the company on the state’s many intangible assets.  “Let’s start with terrain,” the bid stated. “How about a place whose geography won’t constrict or contort your growth? A place without mountain or water barriers. That seems worth a click.”

The document also included letters of support from several of Minnesota’s corporate giants – ranging from Delta Airlines and US Bancorp to the Mayo Clinic.

“The high concentration of Fortune 500 companies headquartered here in the MSP region is rare, if not completely unique,” wrote Christopher Policinski, the chief executive of Land O’ Lakes Inc. “The scale and expertise needed to support those companies is provided by the globally recognized University of Minnesota. Amazon would benefit from this human asset base.”   

The document highlighted more than a dozen sites in downtown Minneapolis and Saint Paul for possible locations – including the former Dayton’s store on Nicollet Mall, several sites near Target Field, the home of the Minnesota Twins, the former Ford Plant in Highland Park, and a Sears store property adjacent to the State Capitol complex in St. Paul.  Many of the sites, including those in suburban Bloomington, Rosemount and Shakopee, had been previously disclosed.

In offering the Dayton’s store to Amazon, the bid stated that at least 500,000 square feet would be available in an initial phase under a 16-year lease that would begin in September of 2019.  “The entire Building of approximately 1,276,003 RSF is currently available if Tenant requires additional space for the initial Premises,” the bid stated.

In describing the North Loop area of Minneapolis, the bid stated that “extending to the Mississippi riverfront and south to the historic Farmer’s Market, the area is home to technology companies, start-ups, creative agencies and architecture firms. The district is Minneapolis’ hottest neighborhood for housing, restaurants, breweries and urban lifestyle options.”

A letter from then-DEED Commissioner Shawntera Hardy contained in the bid (similar to a copy that had been previously released) noted that the state’s public subsidy offerings were limited.  “The initial phase of your Request for Proposal, for example, suggests 500,000 square feet of office space and we estimate, 2,500 employees,” Hardy wrote as part of the bid.  “An expansion of that size would typically generate a state award of $3-5 million from existing DEED programs, in addition to local support as specified in the site proposals.”

However, Hardy added that the Minnesota Legislature had in the past intervened with heftier public subsidy packages for “Unique Public Private Partnerships.” Hardy noted that in 2012, “the Legislature authorized $498 million in state and local resources to support the construction of the $1.1 billion publicly-owned US Bank Stadium.”

Bid contained information on other public subsidies

The bid also informed Amazon that other, unspecified public subsidies might be available.

For example, in outlining other locations for Amazon’s corporate headquarters, the bid stated that a site in Woodbury along Interstate-94 was available, and that the city would – at least, initially — offer tax abatement and tax-increment financing.  The “City of Woodbury and regional economic development agencies are willing to discuss additional sources of funding,” the bid added.