Growth, Amazon and 50,000 More People

Colorado is the second fastest growing state in the U.S.  Rent is up 33% over the last 5 years, and it doesn’t seem to be slowing down any time soon.  The cost of the average house is going up even faster.  A house that cost $190k in 2009 is going for $398k now (Zillow) and that’s in my neighborhood of Valverde, where things are still relatively cheap!  People are moving here at a rate of 250 per day, so is it really something we want to contemplate to bring Amazon here with another 50,000 right into downtown Denver?  Some of the sites they’re looking into are right here in the middle of District 5.  That means our rents and costs of living are going to skyrocket, because those jobs are mostly above $100k per year.  Amazon has, in the past, hired about 23% of its employees from locals, and the other 77% have come from out of state; there’s no reason to believe that trend won’t continue here in Denver.  In fact it will likely be even more pronounced considering Denver’s incredibly low unemployment rate.  That means at least 39,000 new people flooding our housing market and adding to the already skyrocketing rent prices.  It’s hard enough to find a place that we can afford as it is.

Now I do understand the argument that bringing Amazon is a long term strategy.  People are worried that this boom won’t last forever and we need to keep an eye toward long-term growth.  My counterpoint to that is rather that we could very well become another San Francisco if we don’t think about our housing situation, where we have an abundance of high paying jobs but nowhere to live.  A teacher or a police officer can’t afford to live in San Francisco, and if we don’t pursue strategies that incentivize building density and manage our growth then they won’t be able to afford to live here either.

Then there’s the question of what incentives we’re pushing toward Amazon to attract them to Denver. Each year, as the New York Times reports in a major expose’ series, corporations are tapping America’s state and local governments for at least $80 billion in cash grants, free buildings, income tax credits and exemptions, property tax abatements and more.  What are we, the taxpayers getting out of this?  What are we offering Amazon for the pleasure of their company?  Newark is offering them $7 billion in tax subsidies.  That’s a whole lot of money that could go to roads and schools.  So what are we offering?

Amazon is a giant, and it tends to stomp on anything in its path.  Denver is a city already struggling to deal with growth.  Does it really make sense to try to squeeze a giant into a crowded room?

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