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Exclusive: Prompted by HQ2, D.C. Tech Leaders Work With Mayor’s Office to Update Tech Incentives

Friday, May 4, 2018

DC INNO by Sam Sabin

D.C. tech leaders met with Deputy Mayor Brian Kenner on April 17. From left to right: Ashwin Jayaram, CSO, Insomniac Design; Deputy Mayor Brian Kenner; Rosy Khalife, COO, Surprise Ride; and Dan Berger, CEO, Social Tables. Image courtesy of Khalife.

A group of D.C. tech leaders are working with local government leaders to make key changes to the city’s economic incentives policies for tech companies. The move follows a letter the group sent to Mayor Muriel Bowser after details of the city’s bid for Amazon for HQ2 began emerging.

In early March, the group, known as the Capital Tech Coalition, sent Mayor Bowser a letter demanding that local tech companies be given the same incentives offered to Amazon in a bid for its second headquarters. While the entire bid hasn’t been made public, it has been reported that so far it includes:

  • Relocation reimbursements of up to $7,500 per work who moves to D.C. and wage reimbursements up to $30,000 per new job it fills locally with military veterans;
  • A five-year freeze on property taxes on every building the firm occupies at least half of in the District;
  • A 10-year exemption on personal property taxes on qualified items;
  • And a sales tax exemption in perpetuity

On April 17, members of the Capital Tech Coalition steering committee met with Deputy Mayor for Planning and Economic Development Brian Kenner to discuss their concerns. Kenner told DC Inno following the conversation that most of the incentives found in the bid are incentives that are already available in the District’s incentives for “qualified high-tech companies.” However, the coalition said it’s important to note that those incentives were established in 2000 and have only been updated once in 2014.

“In the past three-to-six months or so, I think there’s been a lot of conjecture and misinformation and lack of communication, in general, around the Amazon proposal,” Kenner told DC Inno in an interview after the meeting. “My biggest success for me was just talking. I think sometimes it’s much better to understanding what the real questions are about things, and I think we had a great chance to do that.”

Group of D.C. Tech Leaders Demand Same Incentives as Amazon in Letter to Mayor

There seemed to be agreement on a plan for the advocacy group to workshop and propose updates to those qualified high-tech companies incentives.

District officials tell DC Inno that this is a common way to update economic incentives. Back in 2014, when the incentives were updated, it was through an effort from another local company. They worked with the D.C. government to suggest incentives that they would need to flourish in the city, and a version of those updates were passed and adopted by the D.C. Council.

Before then, however, incentives for local high-tech companies hadn’t been updated since 2000, leaving almost 15 years of technological advancements unaccounted for. That’s where the Capital Tech Coalition plans to come in.

Three members of the coalition’s steering committee took part in the meeting: Dan Berger, CEO and founder of Social Tables, who also formed the CTC; Ashwin Jayaram, chief strategy officer at Insomniac Design; and Rosy Khalife, COO and co-founder of Surprise Ride. They tell DC Inno that they plan to establish two policy workforce committees, one to review the existing incentives and a second to propose additions or changes to the incentives to better serve today’s small-to-medium-sized companies.

Currently, the CTC is made up 39 member companies, with 64 percent of those being headquartered within the District and representing around 1,100 employees. The group also has a seven-member steering committee.

“Our goal was very simple: to make sure that as much of the D.C. tech community is represented in whatever technology discussions are being had,” Berger said in an interview following the meeting. “It’s come to our attention in that meeting that the Mayor’s office did reach out to certain companies, but it seemed to lack some of the coordination that maybe an organization like ours could’ve helped with.”

Jayaram will be heading up the initiative from within the CTC to review existing tech incentives. And Berger pointed out, that while the conversation was introductory and productive, he hopes the organization behind the coalition can help the local government reach more companies in the region, rather than having to approach each one individually.

“We want to make sure that native tech companies, especially small-to-medium companies, are at the table when incentives for technology companies are being discussed so we can offer the right incentives and opportunities to work with government,” Berger said.

D.C. tech leaders met with Deputy Mayor Brian Kenner on April 17. From left to right: Ashwin Jayaram, CSO, Insomniac Design; Deputy Mayor Brian Kenner; Rosy Khalife, COO, Surprise Ride; and Dan Berger, CEO, Social Tables. Image courtesy of Khalife.