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CDFA // BNY MELLON DE DEVELOPMENT FIN FINANCE WEBCAST SERIES The Landscape of Mega Project Initiatives

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Panelists

Tam ammy Da Davis is, , Mod

• derator

Senior Relationship Manager The Bank of New York Mellon

The Landscape of Mega Project Initiatives

Sa Sandi McNin inch

General Counsel Virginia Economic Development Partnership

Chr Chris istina Win inn

Director, Business Investment Group Arlington Economic Development

Isa Isabel l Cyr Cyr, DF DFCP

Senior Consultant The CAI Global Group

Da Dan Taylo lor

Managing Director, Business & Neighborhood Development Baltimore Development Corporation

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Tammy Davis

Senior Relationship Manager, Corporate Trust The Bank of New York Mellon Detroit, MI

The Landscape of Mega Project Initiatives

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Isabel Cyr, DFCP

Senior Consultant The CAI Global Group Montréal, Québec

The Landscape of Mega Project Initiatives

THE LANDSCAPE OF MEGA PROJECT INCENTIVES

A SITE SELECTOR’S PERSPECTIVE

JU JUNE 18, , 2019

Presented by:

Is Isabel Cyr

Senior Consultant

ADVISING COMPANIES TO MAKE INFORMED, COST-EFFECTIVE, AND TIMELY INVESTMENT PROJECT DECISIONS

The CAI Global Group is a location advisory firm with over 35 years of experience assisting businesses by providing location advice for their investment projects.

C A I G L O B A L

WHO WE ARE

The CAI Global Group Inc.

MONTREAL TORONTO NEW YORK PHILADELPHIA

SOME OF OUR CLIENTS

The CAI Global Group Inc.

The CAI Global Group Inc.

Mega Project Incentive Trends

The CAI Global Group Inc.

The Expected Outcome of Incentives

Investment Poaching Healthy Competition Beggar-thy- Neighbor Winners’ Curse

I N T E R N AT I O N A L W E L F A R E D O M E S T I C W E L F A R E

MATRIX OF WELFARE OUTCOMES FROM THE USE OF INCENTIVES

Gain Waste Gain Waste

Source: Incentive Bidding for Mobile Investment: Economic Consequences and Potential Responses. By Andrew Charlton. OECD. January 2003

The CAI Global Group Inc.

Factors Affecting Incentive Awards

Capital investments Creation and retention of jobs Associated wages Undeveloped locations

Source: The CAI Global Group Inc., 2019

The CAI Global Group Inc.

MEGA PROJECT IN INCENTIVE AWARDS BY YEAR

Source: CAI Global Analytics, data range: 1984 to 2018

1 3 1 2 3 3 1 2 2 4 6 10 4 6 6 11 12 6 12 12 11 13 15 15 18 31 23 24 22 30 32 24 10 10 11 5 10 15 20 25 30 35 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

11.3 MEGA PROJECTS A YEAR IN THE US ON AVERAGE

The CAI Global Group Inc.

Mega Project Incentives by State

4 3 2 3 1 2 9 5 16 4 5 2 8 5 4 36 9 15 15 19 12 15 29 10 18 7 10 11 11 6 2 5 4 32 2 4 2 13 30

Source: CAI Global Analytics, data range: 1984 to 2018

1 2 3

STATE TOTAL INCENTIVES # OF MEGA PROJECT INCENTIVE PACKAGES

NY $13.288 billion 32 WA $11.944 billion 2 MI $11.125 billion 36 LA $9.716 billion 29 OR $5.691 billion 9 WI $5.053 billion 4 AL $4.271 billion 18 MO $4.213 billion 15 NJ $4.154 billion 30 TX $3.834 billion 16

The CAI Global Group Inc.

MEGA PROJECT IN INCENTIVES BY TYPE OF PROJECT

Manufacturing Facility 51%

Corporate Offices 20% Energy and Natural Resources Facility 9% Research Facility 6%

Retail: 3% Air Transport Facility: 2% Mixed-Use Development: 2% Data Center: 2% Distribution Center: 1% Other: 4% Other 14%

Source: CAI Global Analytics, data range: 2014 to 2019

The CAI Global Group Inc.

Main Industries for Mega Projects

Chemicals, 295 Electronic components, 1,110 Plastics, 750 Consumer products (Logistics & e-commerce), 3,358 Software & IT services, 537 Renewable energy, 55 Metals, 197 Rubber, 1,425 Automotive OEM, 324

100 1,000 10,000 100,000 1.0 10.0 Total jobs created over the last five years Total amount of money invested over the last five years Billions USD Circle diameter indicates the average number of jobs created for every project, over the last 5 years in the United States

Source: CAI Global Analytics, data range: 2014 to 2019

The CAI Global Group Inc.

The Location Decision

Where Incentives Fit In

The CAI Global Group Inc.

The Site Selection Process

P R E L I M I N A R Y R E S E A R C H C O M M U N I T Y A P P R O A C H D U E D I L I G E N C E R E V I E W L O C A T I O N C H O I C E

B E N C H M A R K L O C A T I O N S & S I T ES

Can bias the list of jurisdictions Request for and incentive proposal (as a separate RFP or in the RFI) Cost model and decisional matrix Close the gap and influence final decision

T H E R O L E O F I N C E N T I V E S I N S I T E S E L E C T I O N

Source: The CAI Global Group Inc., 2019

The CAI Global Group Inc.

The Site Selection Process

P R E L I M I N A R Y R E S E A R C H C O M M U N I T Y A P P R O A C H D U E D I L I G E N C E R E V I E W L O C A T I O N C H O I C E

B E N C H M A R K L O C A T I O N S & S I T ES

Scope of project redefined along the way New jurisdictions added along the way Financing more lengthy and complicated Incentive re-negotiations and lobbying efforts more present

L A R G E S C A L E P R O J E C T S : 1 T O 2 Y E A R S V S S M A L L S C A L E P R O J E C T S : 6 M O N T H S

Source: The CAI Global Group Inc., 2016

More official project announcements involving more stakeholders and communication team

The CAI Global Group Inc.

Incentives Role in Financing

Reduce in initial costs

 Capex or investment grants  Grants to offset start-up costs  Infrastructure grants  Recruitment incentives  Training incentives

Reduce operational costs

 Job tax credits  Utility rate reductions  Property tax abatements  Sales tax exemptions  Inventory tax exemptions

The CAI Global Group Inc.

Case Study 1: Incentive Offer Comparison

US Sit ites

State A

Site 1: $2,050,000 Site 2: $2,050,000 Site 3: $1,750,000

State B

Site 4: $21,841,360 Site 5: $31,877,338

State C

Site 6: $112,745,000 Site 7: $117,313,000 Site 8: $100,059,000

State D

Site 9: $269,877,941 Site 10: $214,820,574 Site 11: $123,771,946 Site 12: $112,807,395

State E

Site 13: $191,445,624 Site 14: $150,408,024 Site 15: $161,445,624 Site 16: $150,408,024 Site 17: $150,408,024

Canadian Sit ites

Province A

Site 18: $74,100,000 Site 19: $74,100,000 Site 20: $74,100,000 Site 21: $74,100,000

Province B

Site 22: $57,300,000- $87,300,000 Site 23: $55,380,000- $85,380,000 Site 24: $55,300,000- $85,300,000

The CAI Global Group Inc.

Case Study 2:

• 1.3 million sq. ft. of building on

1,000+ acres with water treatment onsite

• Financial incentives included:
• Exchange of land for property tax

abatement (with first right of refusal) (custom local incentive agreement)

• Free dismantling of water treatment

facility onsite and upgrade of municipal water treatment capacity and extension of line (using Rural Division’s Economic Infrastructure Grants Program)

• Direct grant from state to company

tied to job creation (State Discretionary Program)

The CAI Global Group Inc.

Case Study 3: Decisional Matrix Comparison

In Investment Criteria Category Transport and Logis istics Food Manufacturing Pharmaceutical and Medic ical Devices

Workforce 15 % 17 % 14 % Transport / Distribution 18 % 12 % 10 % Business Taxes 7 % 8 % 11 % Utilities 8 % 13 % 10 % Local Business Environment 8 % 8 % 9 % Cost and Availability of Sites 15 % 12 % 10 % Incentive Programs 10 % 10 % 10 % Education and Training 7 % 8 % 11 % Quality of Life 2 % 4 % 5 % Tota tal 100% 100% 100% 100% 100% 100%

IINDUS DUSTR TRY COM OMPARISON ARISON OF OF WEI EIGH GHTS TS BY INVES ESTM TMENT ENT DR DRIV IVERS ERS

Source: The CAI Global Group Inc. 2019

The CAI Global Group Inc.

Key Takeaways

The CAI Global Group Inc.

Key Takeaways

Not every project is right for every jurisdiction.

▪ A largescale investment project can come redefine a region’s ecosystem and it is important to anticipate long term challenges as well as the benefits.

Take the time to diagnose your project.

▪ If it is a mega project, make sure you are ready to customize your incentive approach and be patient for a longer decisional timeframe.

Incentives cannot make a bad location good.

▪ But it can make a good location better. For mega project attraction strategies, it is important to have a toolbox of incentives that will provide your offer with flexibility, allow creativity and ensure oversight.

1 2 3

The CAI Global Group Inc.

THANK YOU

Is Isabel Cyr

Senior Consultant

i.cyr@caiglobal.com 1.844.686.6136 x225

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Dan Taylor

Managing Director, Business & Neighborhood Development Baltimore Development Corporation Baltimore, MD

The Landscape of Mega Project Initiatives

1

Port Covington Tax Increment Financing

Presented by: Dan Taylor CDFA Webinar - June 18, 2019

2

Project Background

3

Project Summary

A master-planned mixed-use community with approximately 15 million SF of vertical development supported by $660 million in tax increment finance bonds ($535 million for hard costs) for horizontal infrastructure, including:

• Approx. 200 Acre development area
• 40+ blocks’ worth of new streets
• 40 acres of parks
• Utilities and site work
• Pedestrian/bike paths

4

Current Conditions

Recent Projects:

• Sagamore Spirit Distillery
• Rye Street Tavern
• Under Armour Building 37
• City Garage
• Baltimore Sun Renovation
• South Point

5

Project Rendering

6

Phase 1 of TIF-supported Infrastructure

7

TIF Financing and Community Consensus

8

The Case for Tax Increment Financing

• Business Retention and Expansion: Growth of Under

Armour in Baltimore City

• Business Attraction: Clustering around an Anchor (UA);

Clustering around regional strengths (Tech/Cyber)

• Opportunity: Largest contiguous area of undeveloped land

in Baltimore City

• Location: Excellent location relative to Downtown, BWI,

DC, Fort Meade/Cyber, I-95 but poor connectivity

9

TIF Approval Process

• Application to BDC (sponsoring agency), underwriting by

MuniCap (financial advisor)

• But-for and but-why tests
• BDC board, Board of Finance, City Council for approval

– 3 bills: Development District, Special Taxing District, Bond Authorization

• Each tranche of bonds will go to the Board of Finance and

Board of Estimates for approval prior to issuance

10

Building Public + Political Support

• Significant dialogue and negotiation with elected officials, unions,

religious organizations, community associations, and nonprofits

• SB-6 community benefits agreement
• City-wide community benefits agreement
• MOU with commitment to affordable housing, supplier diversity, and

local hiring

– Developer has a full-time community outreach director – Developer is funding a full-time employee in the Mayor’s Office of Employment Development to monitor and assist with local hiring – Developer has agreed to surpass the City’s minimum affordable housing requirements

• Profit sharing agreement

11

Attracting Investment to the Project

12

Attracting Project Capital

• TIF authorization demonstrates local commitment, serves

as significant evidence of City investment as the project seeks state and federal funds for non-local infrastructure

• $233 million equity commitment from Goldman Sachs

Urban Investment Group (UIG) - the largest single private equity investment by UIG

• Opportunity Zone designation
• Enterprise Zone + Brownfield Credits (a plus for attraction,

a potential challenge for generating tax increment)

13

Attracting Project Interest

• Planned investment in secure fiber loop, branding the

project as “Cybertown USA” has helped attract cybersecurity companies (Data Tribe, Allegis Cyber, and

• thers)
• Early site activation to generate traffic to the site

(Southpoint, distillery and restaurant, bike path)

• Port Covington as Baltimore’s pitch for HQ2

14

Lessons Learned + Best Practices

15

Messaging and Misconceptions

• Public financing/incentives, particularly with figures as

large as the Port Covington TIF authorization, generate public scrutiny

• Messaging how the mechanics of TIF and other incentives

actually work to political bodies and the public is critical

• Common misconceptions include:

– The City is “cutting a check to the developer” – TIF is a discount on property taxes – High-dollar investment means the project is generating high returns to the developer – Bonds will fund private development

16

Mitigating Risk

• Limit bond sizing based on projected increment
• Use of state entity as a conduit issuer to remove bonds

from the City’s debt profile

• Special tax allocation (additional tax on property owners) if

there is not enough increment to pay back the bonds

• Re-test the but-for analysis with each tranche of bonds

17

Thank you!

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Sandi McNinch

General Counsel Virginia Economic Development Partnership Richmond, VA

The Landscape of Mega Project Initiatives

Christina Winn

Director, Business Investment Group Arlington Economic Development Arlington, VA

CDFA THE LANDSCAPE OF MEGA PROJECT INCENTIVES

June 18, 2019

2

VIRGINIA INCENTIVE PHILOSOPHY

Guideposts

• Strong bias for grants, not tax credits or exemptions
• Better control
• More predictable (and, therefore, more valuable) to

companies

• Easier to track
• Strong bias for paying grants after revenues have been

received – staying “revenue-positive”

• Will consider alternatives (escrow, letters of credit or other

security, should a repayment be necessary)

• Strong bias for using incentives to improve economic/business

ecosystem, in some way:

• Higher education investments
• Transportation improvements
• Strong emphasis on return on investment analysis

3

AVAILABLE TOOLBOX FOR PROJECTS

Grants and Tax Incentives Readily Available for Projects

• Grant funds:
• Commonwealth’s Development Opportunity Fund:

deal closing fund

• Virginia Investment Performance Grant: incentivize

large projects for existing manufacturers

• Virginia Economic Development Incentive Grant:

support for significant HQ projects

• Enterprise Zone grants for jobs and capital

investment

• Workforce Services grants and programs
• Tax incentives:
• Sales and use tax exemption for manufacturing

equipment and clean rooms

• Sales and use tax exemption for larger data centers
• Major Business Facility Jobs Tax Credit -- $1,000 per

job for 50+ jobs

4

Exceptional Incentives for Exceptional Projects

• For large or unique projects, the usual toolbox isn’t quite right
• Go to the Major Employment and Investment Project Approval

Commission (“MEI Commission”), which includes leaders of the General Assembly money committees and two Cabinet Secretaries

• Seek MEI Commission approval to offer a special incentive

tailored to fit the opportunity

• If MEI Commission approves, implementing legislation will then

go to full General Assembly; MEI Commission members typically patron the bills

• Most importantly, MEI Commission process allows for

meaningful partnerships and collaborations between the legislature and the executive administration involving economic development issues

• MEI Commission provides some comfort of General Assembly

support, outside of 45- or 60-day sessions

WHEN THE USUAL TOOLS AREN’T UP TO THE TASK

5

Recent Projects for Which the Available Toolbox was Inadequate

• Amazon HQ2: New corporate headquarters
• From the Company: $2.5 billion capital investment / 25,000 new

jobs

• From Virginia: $550 million cash grant, up to $750 million if more

jobs created / $195 million transportation infrastructure / $1 + billion education enhancements, including doubling computer science degrees, K-12 STEM enhancements and internships – approved in 2019 General Assembly session

• Always revenue-positive to the Commonwealth
• Micron: Expanded chip manufacturing facility
• From the Company: <$3 billion capital investment / >1,100 new

jobs

• From Virginia: $70 million cash grant – paid largely up-front, so

clawbacks may be necessary – clawbacks secured by an escrow account – approved in 2019 General Assembly session

• Merck: Expanded pharmaceutical manufacturing facility
• From the Company: $1 billion capital investment / 100+ jobs
• From Virginia: $7.5 million cash grant / $2.5 million in higher

education enhancements for both 2-year and 4-year institutions -- to be presented during 2020 General Assembly session

• Always revenue-positive to the Commonwealth

RECENT EXAMPLES

6

Started with High Level of Coordination with Diverse Partners

• Governor and Cabinet Secretaries
• RFP due during an election cycle
• MEI Commission and other key members of Virginia General

Assembly

• Virginia Department of Transportation
• Virginia Higher Education Institutions, including Virginia

Community College System

• Virginia Workforce Partners
• Virginia Housing Development Authority and other housing

advocates

• Local and business partners in 2 regions, in addition to

NoVa:

• Hampton Roads
• Central Virginia (Richmond)
• Real Estate Developers
• https://hqnova.com/info.html

HQ2

7

Match Amazon Needs with Virginia’s Strengths

Education: ~$1B+ over 20 years

• Investments to double the annual number of graduates with

degrees in computer science and related fields

• Investments for new master’s degree programs in computer science

and related fields, at George Mason University and at Virginia Tech’s new Innovation Campus near HQ2, subject to a 1-to-1 university match

• Investments in K-12 STEM education and in internships to connect

higher ed students to tech jobs Regional Transportation: ~$195MM

• Investments in transportation projects to improve multi-modal

connections between HQ2 and the regional transportation system: Washington Metro, roads, connector to National Airport Post-Performance Grant: $550MM up to $750MM

• Investments ($550MM) if Amazon creates 25,000 new jobs with

average wages of at least $150,000, plus benefits, escalated at 1.5%

• annually. Another $200MM if the Amazon creates an additional

12,850 jobs

VIRGINIA’S OFFER: 3 MAJOR COMPONENTS

8

CONTACT

Sandi McNinch General Counsel (804) 545-5617 smcninch@vedp.org www.vedp.org

Innovation lives here

February, 2019 1

Amazon HQ2:

The Landscape of Mega Project Incentives

Innovation lives here

February, 2019 2

JOINT PROPOSAL BY ARLINGTON & ALEXANDRIA IDENTIFIED SITES IN NATIONAL LANDING - PENTAGON CITY, CRYSTAL CITY AND POTOMAC YARD

UNPRECEDENTED JOINT PROPOSAL FOR HQ2 BID

• Located in the heart of the

DMV adjacent to Reagan National Airport

• Single development

partner– JBG SMITH

• 3 distinct neighborhoods

branded as “National Landing”

• Highly educated market
• Proximity to the Nation’s

capital

• Extensive transportation

network

• 24k housing units

affordable at average Amazon income within 2 miles

• Over +17 million square

feet of office space

Innovation lives here

February, 2019 3

IMPLEMENTING OUR COMMUNITY PLANS

Crystal City Sector Plan/Pentagon City

• 2M SF of vacant office space in Crystal City today (8M in Arlington)
• In Crystal City and Pentagon City, sector plans and development plans envision

the future addition of 21.5M SF of mixed-use development

• Immediate implementation of Met Park, Pen Place, Metro Market Square and a

new transportation system connecting to workforce housing in Alexandria, Crystal City, Pentagon City and Columbia Pike

North Potomac Yard Small Area Plan:

• More than 10M SF of approved mixed-use density, with supporting infrastructure

projects required and planned as development occurs

• With a planned new Metro station, density and growth is required to fulfill the

community’s vision for a transit-oriented, walkable community

Amazon will help realize the long-term vision of adopted community plans

The site is well-served by multi-modal transportation services, including Metrorail, VRE commuter rail, Metrobus, local and regional bus lines, bike sharing and car sharing services.

• Metrorail and the Metro & ART bus systems can accommodate an additional 50,000 to 70,000 weekday

trips in Arlington

• Metrorail weekday ridership in the area is down 20% from its prior peak
• Local and regional bus service also has unused capacity, with Metro Bus weekday ridership down 20%
• ff its prior peak, while ART bus weekday ridership is down 12.5% off its prior peak

Innovation lives here

February, 2019 4

FEDERAL JOB LOSSES

Amazon’s 25,000 jobs help offset the more than 34,000 Federal jobs lost over the last 20 years including NAVSEA, PTO, BRAC, Sequestration, NSF, and future TSA job losses

NAVSEA PTO BRAC FISH & WILDLIFE NSF TSA

• 8000
• 6000
• 4000
• 2000

2000 4000 6000 8000

• 25.0%
• 20.0%
• 15.0%
• 10.0%
• 5.0%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0%

Job Losses Vacancy

FEDERAL JOB LOSSES 22202 ARLINGTON

SOURCE: CoStar; AED

Innovation lives here

February, 2019 5

Arlington County and the City of Alexandria proposed the following local incentives as part of this project with 97% of the proposed incentive package investing in the community.

• $570M in new, expedited and/or enhanced

transportation infrastructure and transit improvements

• $150M in new, affordable and workforce

housing (approximately 2,000+ units)

• $28M in strategic investments in infrastructure

(parks, open space and transportation)

• $23M in TOT Grants for Amazon

PROPOSED ALEXANDRIA & ARLINGTON JOINT COMMITMENTS

75% 18% 3% 4% Transportation Affordable Housing TOT Grant Strategic Investments in Infrastructure

Innovation lives here

February, 2019 6

TRANSIENT OCCUPANCY TAX GRANT

5 10 15 20 25 30 35 40 45 50 YR 1 YR 2 YR 3 YR 4 YR 5 YR 6 YR 7 YR 8 YR 9 YR 10 YR 11 YR 12 YR 13 YR 14 YR 15 BASE INCREMENT - ARL GRANT - HQ2

TOT revenues*

$ Millions

Cumulative Increment Totals* HQ2 TOT Grant Add’l Arlington Revenue $ Millions 2.5 9.7 22.7 Total Increment Base = $26M Additional Arlington Revenue HQ2 grant = 15% of increment

*Based on initial project assumptions. As more information becomes available, estimates and projections will be refined

14.0 54.9 128.7

Innovation lives here

February, 2019 7

November/December

Nov 13 – Virtual Learning Series – Amazon Announcement* Nov 26 - Virtual Learning Series – Economic Development & Planning*

• Nov. 29 – Crystal City Civic Association, panel discussion with CC BID president Tracy Gabriel, Board Chair Katie Cristol & JBG
• Dec. 3 – Kojo Nnamdi Community Town Hall Meeting – Panel with Tracy Gabriel, Katie Cristol, Christian Dorsey and others, at Synetic Theatre.
• Dec. 6 – Virtual Learning Series on Amazon: Transportation*
• Dec. 11 – Civic Federation (overview, facts, the proposal) – AED Director Victor Hoskins and VED’s Stephen Moret are invited

Dec 11 – Arlington Economic Development Commission

• Dec. 12 – Committee of 100, Victor Hoskins, evening
• Dec. 12 – George Mason University, Founders Hall, 5:30pm, on Amazon’s effect on the local housing market (see details)
• Dec. 13 – Urban Land Institute, panel discussion on Living with Amazon: How Developing the Missing Middle Can Address the Region’s Housing Needs, 8-9:30AM

Dec 17 – Community Listening Session with County Board and Staff*

• Dec. 19 – Virtual Learning Series: Schools, Higher Education and Workforce*

Dec 19 – IDA Board Meeting to discuss Amazon*

January

• Jan. 8 – Civic Federation, pros/cons of Amazon in Arlington

Jan 9 -- Aurora Highland Civic Association

• Jan. 12 : Community Listening Session w Board Members*
• Jan. 16 – Virtual Learning Series: Housing*

February/March

Meetings with Civic Associations Mar 17: County Board hearing* (Timing depending on finalizing agreement)

COMMUNITY ENGAGEMENT

*ARLINGTON COUNTY LEAD

Innovation lives here

February, 2019 8

AMAZON CONVERSATION WITH THE COMMUNITY: EMERGING THEMES

• INCENTIVES: Some have expressed concern about using transient occupancy taxes to support an incentive

package for Amazon (as opposed to other types of things for residents)

• TRAFFIC/PARKING: People have expressed their anxiety about the potential increase in traffic and limited

parking that may come with an increased number of people in single occupancy vehicles.

• TRANSIT: While Amazon offers transit benefits to their employees, the challenges with Metro over the past

several years have not created confidence that Amazon employees will use public transportation.

• HOUSING COSTS: The costs for living in Arlington (for both owners and renters) have been rising over the

past decade and have limited people with lower salaries and wages to be able to live here. People are genuinely concerned that Amazon’s arrival into Arlington will add to those challenges.

Innovation lives here

February, 2019 9

AMAZON CONVERSATION WITH THE COMMUNITY: EMERGING THEMES

• BUSINESS PRACTICE: A group of stakeholders has shared their concern about Amazon’s business practice;

and their alignment with Arlington County values.

• LOCAL HIRE/FAIR WAGES: Some of you have shared the importance of creating good paying jobs for all

levels of workers and the need to integrate local hiring and community benefit agreements with private developers.

• SCHOOL GROWTH: We know that school population growth and classroom capacity is an area of interest for

many Arlingtonians, and residents have expressed concern that a big company like Amazon will bring even more student growth.

• DENSITY/GROWTH: Last summer during the Big Idea roundtable sessions and now with the Amazon

proposal, we know that balancing density and growth –with our ability to maintain the character and diversity of

• ur community is important for those of us who live, work, and play here in Arlington.

Innovation lives here

February, 2019 10

AMAZON SELECTS NOVA’S NATIONAL LANDING FOR A HQ2 SITE

Amazon selects NOVA for HQ2 site after 14-month search

• $2.5 billion investment by

Amazon in Arlington County

• At least 25,000 new HQ jobs

within 12 years New Virginia Tech Innovation Campus to locate in Alexandria

• $1 billion investment by VT
• 1 million square foot mixed-use

campus New State investments in transportation, affordable housing, higher education and K-12 education for National Landing and NOVA

Innovation lives here

February, 2019 11

HQ2 NOVA AT NATIONAL LANDING

Innovation lives here

February, 2019 12

AMAZON – ANTICIPATED PATH OF GROWTH

5000 10000 15000 20000 25000 30000 35000 40000 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034

Expected New Jobs

1000000 2000000 3000000 4000000 5000000 6000000 7000000 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034

Estimated Office GFA

Phase 1 Phase 2

25,000 37,850 4,000,000 6,056,000

Innovation lives here

February, 2019 13

HQ2 ARLINGTON IMPACT – BY THE NUMBERS

Accelerates realization of Arlington’s 10-year Capital Improvement Plan (CIP) for Transportation

10 YR

Increase of more than $32M in annual local revenues once 25,000 jobs have been created (by year 12), $47M once 37,500 jobs have been created (by year 16)

$32M*

$174M cumulative revenues during the 12-year ramp-up period, $342M cumulative during the 16-year ramp-up period

$174M*

Nearly a 14-to-1 return on local direct financial incentives to Amazon

~14:1

Diversifies the industries in Arlington, firmly establishing the region as a technology hub and creates opportunities for indirect and induced jobs New jobs created offset the more than 34,000 Federal jobs lost over the last 20 years including NAVSEA, PTO, BRAC, Sequestration, NSF, and future TSA job losses

• 34K

Only 5% of Arlington’s proposed package is direct incentives to the company, 95% are investments in infrastructure and affordable housing

95%

*Includes estimates for property tax, business tangible property tax, sales and meals taxes, transient occupancy tax, and BPOL from landlord. BPOL revenue from the company is not included at this time because it is not known which business units and affiliated entities will be located in Arlington and if they will be subject to and/or have transactions exempt from business license

• taxes. Based on initial project assumptions. As more information becomes

available, estimates and projections will be refined.

Innovation lives here

February, 2019 14

MORE INFORMATION Amazon in Arlington www.arlingtonva.us/amazon www.hqnova.com

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Tammy Davis

Senior Relationship Manager, BNY Mellon Corporate Trust 313-967-4344 tammy.davis@bnymellon.com

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