Apr 7
2022
No tax break request yet for Amazon project
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The online retail giant Amazon hasn’t applied for any tax breaks for a proposed $300 million warehouse in Niagara County.
At least not yet, anyway.
Niagara County Industrial Development Agency Attorney Mark Gabriele said this week that the company has not yet submitted an application for tax break assistance for a five-story distribution center it has proposed for a site on Lockport Road in the Town of Niagara, just outside Niagara Falls.
Today is the deadline for submitting items to be considered for the NCIDA’s next regularly scheduled board meeting, slated for Wednesday. The board isn’t scheduled to meet again until May 11.
Amazon presented plans for its proposed “first-mile” fulfillment center to the Niagara County Planning Board earlier this month. During the meeting, an Amazon representative said the center would create at least 1,000 full-time jobs, offering an average wage of $18 per hour, plus benefits.
The Niagara Gazette reported that the town planning board agreed on Tuesday to table a preliminary site plan and request for variances for the project.
Amazon had a similar plan for a 145-acre parcel on Long Road in the Town of Grand Island two years ago. The company ultimately scrapped the proposal amid concern from residents about the potential traffic impact on local roads and the Grand Island bridges.
The project also faced opposition from critics who questioned the cost of subsidies being sought by Amazon at the time.
Despite being one of the wealthiest companies in the world, Amazon has a long history of using public resources to help finance its projects.
Research done by Good Jobs First, a non-profit organization that tracks local and state economic development subsidies, shows Amazon has received about 20 incentive packages a year for warehouses, distribution centers and other projects since 2012. The organization says state and local subsidies for Amazon projects have now exceeded $4 billion, and counting.
In New York state, local industrial development agencies have handed out $400 million in subsidies to Amazon in the past eight years, according to Good Jobs First.
For the Grand Island project, Amazon’s developer negotiated a 15-year payment-in-lieu-of-taxes deal with the Erie County Industrial Development Agency.
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While the terms of the PILOT were kept under wraps due to a non-disclosure agreement tied to the project, an analysis from the developer estimated that Amazon would have made reduced property tax payments totaling $93 million over the course of the 15-year deal. The payments included $41.1 million to the town, $34.4 million to the Grand Island School District and $17.4 million to Erie County.
Without Amazon’s distribution center, the project’s developer estimated that property taxes paid on the site over the same 15-year period would have equaled $393,272.
Amazon also reportedly considered giving the town an added $10 million incentive package that would have covered construction of a new community center, a bike trail and other local infrastructure improvements.
Pat Garofalo, director of state and local policy for the American Economic Liberties Project, a non-profit that advocates for corporate accountability, argued in his own analysis of the project that Amazon would still have made out pretty well under the agreement, which included an 85 percent property tax reduction in year one.
“In year two, it would have been reduced by 80 percent, with gradual increases until, finally, in year 16, Amazon paid full freight,” Garofalo wrote. “Due to those big discounts in the early years, I’d bet Amazon’s savings from the PILOT would have exceeded the $10 million offered to the (town).”
State Sen. Sean Ryan, D-Buffalo, has sponsored legislation that would prohibit the use of funds, financial incentives or subsidies “where facilities or properties are used primarily for e-commerce storage or transfer.”
In March, he joined other state lawmakers in calling for a ban on public subsidies for Amazon and other e-commerce and logistics facilities, arguing that such subsidies force residents to shoulder the property tax burden for wealthy companies that can afford to build their own projects without public assistance.
“New York’s taxpayers should not bear the burden of subsidizing massively profitable companies like Amazon – and especially not when those subsidies are buying us low-wage jobs,” Ryan said.
