Philadelphia city officials worked closely with Amazon and tried to “slow down” and amend legislation that would require retailers to take cash, according to emails between the city and the online retail giant.
When efforts to carve out Amazon from the proposed cash requirement did not satisfy the company, officials in the city’s Commerce Department offered to work with the agency that would enforce the proposed law to ensure Amazon’s interests were protected, according to emails reviewed by the Inquirer.
The effort to intervene, by an Amazon employee who is not listed as a registered lobbyist with the city’s Board of Ethics, targeted a bill that aims to protect poor Philadelphians from discrimination but could prevent the e-commerce giant from opening a store in the city. The measure — now on Mayor Jim Kenney’s desk — could also affect the operations of city businesses such a salad chain, a coffee shop, and a student food hall.
The emails, provided by the Commerce Department in response to a request from the Inquirer, show the extent of Amazon’s backdoor lobbying — hidden from public scrutiny — even as the company hasn’t publicly spoken about Philadelphia’s proposal to ban stores that don’t accept cash.
“If the Amazon employee was involved in discussion of legislation, that’s absolutely lobbying,” said Patrick Christmas, policy director at Committee of Seventy, a Philadelphia-based good-government advocacy group. “Everyone needs to be able to see who is influencing the process.”
As lawmakers pushed to ban cashless stores, city officials kept Amazon “in the loop” and sought an amendment to the bill that would make the proposed cash requirement temporary, emails show.
Libby Peters, the Commerce Department’s director of Policy and Performance, notified an Amazon employee on Jan. 16. that the Council bill “has legs” and was scheduled for a committee hearing on Feb. 5. Peters wrote that the bill’s primary sponsor, Councilman William Greenlee, was “not receptive to our suggestions that we slow the process down or consider a sunset date on the legislation.”
“We said we would keep you in the loop if anything developed with the cashless business bill here in Philadelphia," Peters wrote to Jillian Irvin, a Washington-based public policy official at Amazon. "Once out of committee it’s very difficult to amend or slow down the bill. Any chance we could have a quick check in call with you?”
Amazon plans to open up to 3,000 Amazon Go cashierless stores across the country over the next few years. The stores allow consumers with a mobile app to grab items they need and leave, eliminating the need for a traditional checkout process. After the customer leaves, Amazon charges the user’s online account.
Irvin, the Amazon official, emailed Greenlee’s office on Feb. 4 with a proposed amendment to the bill that would effectively exempt Amazon Go stores from the cash requirement.
Although Irvin clearly tried to shape legislation, she is not registered as a lobbyist with the city’s Board of Ethics.
Philadelphia law requires lobbyists to register when they are paid at least $2,500 or perform 20 or more hours of lobbying during a quarterly reporting period. Violators can face fines of up to $2,000.
It’s unclear how many hours Irvin worked on the Philadelphia bill, but direct communication by emails and phone calls started as early as Oct. 30 and has continued through through Feb. 12, according to records.
“The Department of Commerce was not explicitly aware of Jill Irvin’s (the Amazon employee) status, or lack thereof, as a registered lobbyist,” department spokesperson Lauren Cox said in a statement. “Philadelphia’s regulations put the onus on the individual/firm rather than the City, so our staff did not ask Ms. Irvin about her status.”
Amazon said it complied with all relevant lobbying laws.
Despite Amazon’s efforts, City Council ultimately passed legislation with language that Amazon believes could be “detrimental” as the company plans to open cashierless stores, emails show.
Amazon wanted language that would exclude retail locations that “collect payment from customers solely by a mobile device application or by charging a customer’s Internet-based account,” according to a copy of the proposal.
Instead, Council amended the measure to exclude retailers “selling consumer goods exclusively through a membership model that requires payment by means of an affiliated mobile device application.”
Greenlee has said that language should allow Amazon to open one of its stores in the city. But Amazon and its legal counsel don’t think that the language is applicable to their model, according to Cox, the Commerce Department spokesperson. In particular, Amazon has concerns with the word “membership” because the company’s “Prime” membership is not required to access Amazon Go stores, Cox said.
“With all due respect to Amazon, they can request something but it’s our decision on how to word something,” Greenlee said. “They didn’t get elected to make those decisions. We did.”
After lawmakers advanced the bill from committee without Amazon’s amendment, First Deputy Commerce Director Sylvie Gallier Howard told Irvin there was still hope to fix the issue. She said the city could resolve the issue through regulation, or Amazon could contact another lawmaker.
“You could try for the amendment again as there is still an opportunity or I can work with the Human Relations Commission to address through regulations,” Howard wrote on Feb. 8. “I believe Councilmember Green (not Greenlee) might be helpful with that amendment."
Irvin asked to be put in touch with Green. But she said the “membership” amendment may have made things worse.