When Google executives and I first discussed a concept for a major development in Downtown San Jose, we agreed that San Jose wouldn’t provide any subsidies, tax breaks, fee reductions, or land discounts. More importantly, Google never asked for a dime. Their executives made it clear that they would pay full freight — for land, fees, and taxes. They have merely sought that we negotiate with them in good faith, sell land based on an independently-appraised fair market price, and treat them fairly in the public land entitlement process. Additionally, as noted earlier, Google executives have expressed a willingness to pay for additional “community benefits” — such as for affordable housing and educational programs for low-income youth — in excess of standard fees and taxes.
San Jose’s situation stands in stark contrast to the experience of New York City and Crystal City, Virginia, where Amazon will receive more than $2 billion in incentives in cash subsidies, tax rebates, and fee breaks for landing its new “HQ2” campuses there. News of large subsidies for big corporations hardly seems unusual these days, as we’ve seen in announcements of General Electric’s move to Boston, or Foxconn’s expansion in Wisconsin, or Tesla’s in Nevada. And in San Jose’s own history, ample examples exist of less sizable subsidies — such as the $32 million that the San Jose Redevelopment Agency provided Adobe for its Downtown headquarters move in the 1990’s.
Google’s project charts a very different approach to economic development: one that pits neither party as savior nor supplicant, but rather as partners in a mutually beneficial relationship.