Nov 17
2022
Thanks to WNY, Amazon subsidies hit $5 billion
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A $124 million subsidy package given to Amazon by the Niagara County Industrial Development agency this summer helped the e-commerce giant reach a milestone: $5 billion in total government subsidies.
That total came from 309 subsidies in 38 states since 2000, according to data compiled by Good Jobs First, a nonprofit that tracks corporate tax breaks. Washington, the state where Amazon is headquartered, gave the company the most subsidies, a total of $824 million. Illinois ranked second with $732 million, followed by New York at $671 million.
Those subsidies went towards facilities ranging from warehouses to offices to film and television studios. Subsidies for Whole Foods, the grocery chain Amazon owns, were also included.
As of June 30, film tax credits from New York’s Empire State Development put Amazon’s total subsidies at $4.98 billion.
Then, the Niagara County IDA on August 10 issued a $124 million package of property, sales and mortgage tax breaks for a 3-million-square-foot warehouse in the Town of Niagara .
That pushed Amazon across the $5 billion line.
That subsidy package broke down into a $94 million property tax abatement over 15 years, a $26 million sales tax exemption and a $3.5 million mortgage tax exemption.
In addition, Amazon is eligible for an estimated $22.4 million in state tax credits over 10 years.
Altogether, the county and state tax breaks work out to $146,000 per job. Most positions will pay $15 an hour.
Since the Niagara County deal, a county in Oregon has pledged an additional $38 million in subsidies to Amazon.
In a press release, Good Jobs First criticized both Amazon and the government agencies giving subsidies to the company.
“Governments are wasting huge sums subsidizing Amazon, even as the pandemic drove record growth for the company, and repeated exposés have shown the deplorable working conditions of its warehouse workers and the power it has to drive small businesses out of the marketplace,” said Kasia Tarczynska, a senior researcher who maintains the Amazon Tracker.
“Amazon must stop squeezing communities.”
Good Jobs First Executive Director Greg LeRoy added that Amazon should be paying its taxes.
“Working families want justice, not charity, from Amazon,” he said. “That means paying taxes like everyone else — with no subsidy tax breaks — and recognizing workers with a bonafide union contract.”
Amazon’s Niagara County deal came after the company canceled a similar project on Grand Island in Erie County. Officials with Grand Island and the Erie County IDA previously told Investigative Post that a number of factors — including public protest, the ongoing COVID-19 pandemic and a requirement Amazon utilize local labor to build the warehouse — all likely contributed to the company pulling out of the deal, which also would have come with an unspecified subsidy.
Amazon has three facilities in Erie County, but only one receives tax breaks. The Hamburg IDA granted Amazon $6.8 million in property, sales and mortgage tax breaks in 2021. Amazon’s two other Erie County warehouses, in Lancaster and Tonawanda, came without subsidies.
But after pulling out of Grand Island, Town of Niagara officials solicited Amazon, offering a 216-acre “shovel ready” property and writing that the town was “fully on board and committed to assist” Amazon.
Ultimately, that meant the town allowed Amazon to skip an environmental review for the warehouse, and the Niagara County IDA approved a $124 million incentive package without any public debate or discussion.
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At the time, Niagara County IDA Chairman Mark Onesi defended the subsidy.
“Doing business in New York is expensive and a lot of companies won't come without those inducements,” he told reporters after the board approved the tax break. “We want [these] 1,000 jobs.”
Officials with the Niagara County IDA didn’t respond to a request for comment for this story.
