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As finalist for Amazon's HQ2, tough questions remain for Pittsburgh

Aaron Aupperlee
| Thursday, Jan. 18, 2018, 9:18 a.m.
REUTERS
Inside Amazon's one-day pickup location on the University of Pittsburgh's campus in Oakland. Orders placed by 10 p.m. can be picked up the next day at the center.
Jeremy Boren | Tribune-Review
Inside Amazon's one-day pickup location on the University of Pittsburgh's campus in Oakland. Orders placed by 10 p.m. can be picked up the next day at the center.
The Amazon logo in Santa Monica, Calif.
The Amazon logo in Santa Monica, Calif.

The team behind Pittsburgh's bid for Amazon's second headquarters is taking pride that the city is among 20 finalists announced Thursday but stressed there was much work to do.

Officials expect visits from Amazon and tough questions about public transportation, affordable housing and workforce development. They said the package the city put together to the company is flexible.

"Our work's ahead of us," Pittsburgh Mayor Bill Peduto said Thursday during a news conference. "We have to address not only the positives that our region has but also the challenges that our region has."

Peduto said the question isn't whether Pittsburgh can handle Amazon and the 50,000 jobs it expects its second headquarters will add but whether Pittsburgh can compete with the 19 other cities on the list.

"And I truly believe we can," Peduto said.

Amazon said it may request additional information from the top 20 locations over the next few months. The company said it will dive deeper into their proposals and study if the sites can meet the company's hiring plans. Amazon will also look at each site to see if it will benefit its employees and the local community, the company said in a statement.

Amazon has said it's second headquarters will bring with it $5 billion in investment.

Pittsburgh is one of 238 cities and regions from across the United States, Mexico and Canada to submit a bid. Allegheny County Executive Rich Fitzgerald said that a few decades ago, Pittsburgh wouldn't be on a shortlist for a company like Amazon.

"You look at that list, and it's a tremendous honor for us," Fitzgerald said. "This is a proud day for Pittsburgh, for Western Pennsylvania, for the entire region."

Peduto and Fitzgerald were joined by Stefani Pashman, head of the Allegheny Conference on Community Development. The three said they haven't received further instructions or communications from Amazon regarding what's next.

"We are ready," Pashman said. "When this bid went in, we didn't stop working. We kept the team meeting. We made sure that when we got this phone call or this email or this press release, we would know exactly what to do."

Pashman said the team, known as PGHQ2, had two news releases ready for the announcement Thursday: "The good one and the not-so-good one."

The team has been meeting regularly since the bid was submitted and has put together ideas of where to take Amazon and what to show the company when it visits.

The team submitted a 2-inch-thick bid to Amazon in October. None of the bid has been made public, and public record requests for details in the bid or emails and communications surrounding the bid have been denied. Peduto and Fitzgerald maintained Thursday that they will continue to keep details of the bid private.

The initial bid may have cost as much as $500,000. The team will begin searching for additional funding to continue its work.

Pashman felt confident that the initial bid will continue to be attractive to Amazon. Peduto said he expects Amazon to offer or suggest changes to bids in the top 20 and called Pittsburgh's bid "very flexible."

Pittsburgh won't be sending Amazon an 80-foot cactus or another goofy gift as it moves forward, Peduto said. The team has told Amazon that the Pittsburgh International Airport has added a direct flight to Seattle since the bid was submitted.

Peduto said he sees Pittsburgh in competition with other mid-sized cities. He noted that other rust-belt cities like Detroit and Cleveland did not make the shortlist. He said Columbus, Ohio — perhaps the only other true rust-belt city on the list — offers much of what Pittsburgh offers.

Columbus edged out Pittsburgh for a $50 million Smart Cities Challenge Grant in 2016.

Peduto said he will see Columbus Mayor Andrew Ginther next week.

"I'll be sure to take him down," he joked.

Peduto said he feels Pittsburgh has to compete against other mid-sized cities like Nashville and Raleigh, N.C., for Amazon's attention.

"Pittsburgh has as much to offer, if not more, than any of our competitors in that category," Peduto said.

Philadelphia made the shortlist. Neither Peduto nor Fitzgerald were concerned about a Keystone State bidding war between the two cities for HQ2. Gov. Tom Wolf did not take sides Thursday.

"Both Pittsburgh and Philadelphia have a real shot, and we will continue to support these locations by making the case to Amazon that Pennsylvania is a unique and tremendous place to build a business, make a home and pursue your happiness," Wolf said in a statement.

Amazon's short list of possible HQ2 locations contained most of the cities expected to be favorites. Major population centers like New York, Boston, Chicago, Los Angeles and Dallas made the list. Locations around Washington, including the District of Columbia itself, Northern Virginia and Montgomery County, Md., made the list and could indicate that Amazon is looking there for its second headquarters. Amazon CEO Jeff Bezos bought the Washington Post in 2016 and a $23 million home in Washington last year.

Peduto said Toronto and Canada's immigration policy make the only foreign city on the list a competitive candidate.

Most notably not on the list is Detroit, which boasted its closeness to Carnegie Mellon University in its bid. Amazon called Detroit leaders Thursday and told them the region didn't have enough talent , according to the Detroit Free Press.

Jim Rock, CEO of Seegrid, a robotics company in Findlay, said landing in the top 20 for Amazon's HQ2 moves Pittsburgh closer to being one of the top technology hubs in America. Rock estimated that Amazon would boost Pittsburgh's tech workforce by 15 percent on its own and drive additional growth.

"Pittsburgh has a long-standing reputation for innovation–long before top tech companies such as Apple, Google, Uber and even Amazon itself established a presence in the city," Rock said. "Pittsburgh is a natural fit for Amazon with its strong talent pool, affordable commercial space and thriving tech community — just a few of the reasons why we chose Pittsburgh for Seegrid HQ."

Both Fitzgerald and Peduto said they learned about Pittsburgh being on the list when their phones started ringing and messages came flooding in Thursday morning.

"My chief of staff Dan Gilman called, and Dan knows not to call unless there's something that is critical. I picked it up and he said, 'Did you see the news?'" Peduto said. "I thought the worst."

Audrey Russo, head of the Pittsburgh Technology Council, said she wasn't surprised Pittsburgh made the short list.

"It's not a very short list," Russo said.

Josh Knauer, a tech entrepreneur and investor in Pittsburgh, feels Pittsburgh has a good chance of being on top. Knauer, who founded Rhiza, a media and consumer analytics company that was acquired by Nielsen last year, said Pittsburgh is a great place to live and to work and has an incredibly deep tech talent pool. That is what drew him to the city more than 20 years ago.

"I'm happy Pittsburgh is being recognized for the powerhouse that it is," Knauer said. "Pittsburgh would be a perfect choice for Amazon."

Amazon expects to make a final decision this year.

Cities/areas making the top-20 list are:

• Atlanta

• Austin, Texas

• Boston

• Chicago

• Columbus, Ohio

• Dallas

• Denver

• Indianapolis

• Los Angeles

• Miami

• Montgomery County, Md.

• Nashville, Tenn.

• Newark, N.J.

• New York

• Northern Virginia

• Philadelphia

• Pittsburgh

• Raleigh, N.C.

• Toronto

• Washington

Staff writer Bob Bauder contributed to this report. Aaron Aupperlee is a Tribune-Review staff writer. Reach him at aaupperlee@tribweb.com, 412-336-8448 or via Twitter @tinynotebook.

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