PITTSBURGH — Rich Fitzgerald is confident he can forge a mutually beneficial partnership between Amazon and Pittsburgh if the region wins the tech giant’s second headquarters, but the Allegheny County executive is steadfast in his belief that the bid needs to be kept under wraps for now.
“You can’t have 1.3 million people negotiating a deal,” he says.
That’s the population of Allegheny County, including Pittsburgh and surrounding cities. As county executive, Fitzgerald is leading the region’s efforts to land Amazon HQ2 in partnership with Pittsburgh Mayor Bill Peduto.
Fitzgerald made the comments as part of a larger discussion with GeekWire that touched on economic development deals with other companies, hometown innovation, and Pittsburgh’s transformation.
“We were trying to hang on to the past,” he said of Pittsburgh’s previous mentality. “When are the mills coming back? Are they going to open up again? Are the factories going to open up? We were the last ones to get drive-thru and Starbucks. We were just always last.”
“Well 20 years later, we’re five years ahead,” he said. “We’re the first ones to own autonomous vehicles. We’re the first ones with drones. We’re the first ones with certain medical transplantation things that are happening. We’ve gone from the behind the curve to ahead of the curve. I think that’s something that Pittsburghers can really be proud of.”
Fitzgerald is only the third county executive in Allegheny County’s history. Voters created the executive position in 1998, consolidating three county offices into one. A born-and-raised Pittsburgher, Fitzgerald likes to joke about the irony that he grew up in the city proper while Peduto was raised in one of the 129 surrounding municipalities under the county executive’s purview.
“We have a mayor that grew up in the county that’s running the city, and we have a county executive who grew up in the city and he’s running the county,” Fitzgerald said.
Fitzgerald is a father of eight and he says he got into politics for purely personal reasons. “I want them all to live here.” That is the driving force behind Fitzgerald’s economic development goals for the region — and why he is fighting so hard to give Pittsburgh the best possible chance at landing Amazon HQ2.
He reiterated that officials do not intend to comply with a ruling from Pennsylvania’s Office of Open Records that ordered the release the HQ2 bid to the public within 30 days. Instead, they plan to appeal the ruling. Fitzgerald said he will release the proposal when Amazon makes its decision, “win or lose.”
The secrecy has become a point of contention in Pittsburgh. At a community forum last week, residents looked to Amazon’s first home, Seattle, as a cautionary tale and raised concerns over how the company might negatively impact Pittsburgh. At the event, a University of Pittsburgh professor started a petition demanding the city and county release the bid.
Fitzgerald said he is concerned about putting Pittsburgh at a disadvantage against other cities that haven’t revealed their bids. Some cities, like Washington, D.C. and Columbus, have released their proposals. But he believes calls to reveal Pittsburgh’s bid are premature and unnecessary at this stage of negotiations.
“This is something that happens all the time,” he said. “I meet with companies, airlines, developers, that want to do business here. I have private discussions in this room,” a private conference room adjacent to his office in downtown Pittsburgh. Many of those conversations, Fitzgerald says, “never get out there.”
But Amazon’s HQ2 contest is unprecedented in many ways. Amazon announced the project publicly and it has become a media spectacle; the company is offering to bring 50,000 high-paying jobs and $5 billion in investment to the city that wins. In addition, Amazon is publicly requesting government incentives from the contenders.
Regardless, Fitzgerald says that privacy is necessary to get a deal like this done. If Pittsburgh does manage to land HQ2, he believes oversight from elected officials and the public will ensure a fair arrangement with Amazon is established.
“I introduce it very publicly,” he said. “Everybody gets to see it. County Council takes it and then they have committee meetings and hearings on it, and people get to come in and testify … Council will ultimately make the vote.”
Pittsburgh City Council candidate Sonja Finn disagrees. In a separate interview with GeekWire, she argued that there’s no chance of Pittsburgh officials rejecting the deal once a selection has been made, because Amazon is offering such a massive prize.
“Let’s say we get it,” she said. “City Council will be looking to approve but what person on City Council is going to be like, ‘no?’ We just got somebody saying they’re going to invest this much and 50,000 new jobs and I’m going to be the one who says no because we didn’t write the correct deal?”
Despite pushback, keeping the deal secret is worth it to Fitzgerald if it increases Pittsburgh’s chances of landing HQ2. He has played an active role in Pittsburgh’s revitalization, driven in large part by the city’s tech, education, and medical fields.
Those strengths have helped the former Rust Belt city rebound from the collapse of steel and manufacturing. But Pittsburgh is missing a large anchor tech company that can supply the talent, capital, and entrepreneurial activity needed to turn the city into a top-tier tech hub. Fitzgerald believes landing that missing ingredient is worth pushing back against the journalists, open records advocates, and colleagues who are demanding more transparency.
Continue reading for additional highlights from GeekWire’s interview with Fitzgerald.
On Uber’s rocky relationship with Pittsburgh: “To be honest with you, I think the Uber thing has been very positive for Pittsburgh. I’ve been very, very pleased. We actually are partnering with them in a strong way. They want to continue to grow their workforce here. I’ve just sent a name over to County Council for an appointment to our Board of Trustees in our community college that is an Uber employee so that they can be engaged with workforce development like other companies have been in the past.”
“There have probably been times when maybe they’ve done things that violated certain restrictions and just like any company that would violate environmental regulations, or whatever; things like that occur. For the most part, we’re glad they’re here.”
On Pittsburgh’s top innovation: “I just I think all of robotics. Whether it’s robotics around autonomous vehicle, or autonomous robotics around medical advancements, robotics around warehouses. You have self-driving forklifts. All the autonomous things that are happening around those type of things. We’re like Roboburgh. The city of robots. What’s going on from CMU to the Strip District in Lawrenceville is just transformational. I’m proud that it’s happening here in my hometown.”
On government incentives for economic development: “I think what you want to do is make sure you don’t pay upfront, and then hope there’s jobs on the back end. It’s more about partnering where once we see the jobs and once we see the revenue, maybe there could be some reduction in tax credits and things like that.”
“Let me just say this, the tax benefits or the tax incentives, I think will be really a small part of why Amazon makes its ultimate decision. When you look at the cost of doing business, the tax part of it is just a small part of it. It’s the cost of housing. It’s the cost of workers. It’s the cost of office space. It’s the cost of land. It’s the ease of transportation. There’s a whole lot of factors that go into that, that are much more impactful for the bottom line and the future growth of Amazon than are they going to get a 10 percent break on their taxes, or a five percent break?”
On what Amazon HQ2 can learn from HQ1 in Seattle: “Well, that’s one of the goals, and as we go forward with this, that workforce development and resources toward workforce development is going to be important. One of the things I’ve noticed in following how Amazon operates, and some of the things that they talk about, is they are starting to invest in early childhood education and internships for kids. The amount that they’ve endowed to the University of Washington, for example, for workforce training. I think probably HQ1 wasn’t as planned as HQ2 is going to be. It just grew so fast, they needed to build more buildings. They needed to get more office space. This came online. That came online. It seems like HQ2 is going to be much more thought out and planned. That’s just a natural occurrence. They probably never knew it would take off like it did.”
On how he would prepare for Amazon’s arrival: “It’s really, how do we work together? Is it transportation? Is it getting better mass transit to work where you need to be? Is it a workforce development program from our community college that can help provide opportunities for Pittsburghers, for people from Allegheny County; but also it can help Amazon in the workforce needs that they have? Where are you going to be moving to? What’s going to be the impact of the housing market in that area, in that neighborhood that you’re going to be at? That’s great that we’re going to see an increase most likely in property values for folks who own their home. That’s good. They’re going to build wealth from paying that mortgage all the time. But we don’t want to force out some of the folks, particularly renters, who have been there a long time. Putting in some sort of affordable housing mix with market rate housing, which is something we do, by the way, all the time anyway.”