The Niagara County Industrial Development Agency gave preliminary approval for an additional $3 million in sales tax incentives for Amazon’s nearly complete fulfillment center, but that would be offset by not using other granted incentives.
During Wednesday’s IDA board meeting, agency counsel Mark Gabriele said that Amazon would not utilize the more than $3.5 million in mortgage recording tax exemptions previously awarded back in 2022. He said Amazon informed him they would simply not use those benefits for the 8995 Lockport Road facility
Amazon officials said its newest request was due to increased costs in material handling equipment systems and updates to the facility’s design, resulting in a $37.5 million increase and construction costs totaling $587.5 million.
“There’s been changes in the construction world during that time as material costs have increased,” said Director of Economic Development Brad Griggs, calling into the meeting.
IDA Chairman Jason Krempa said they did not expect the overall cost of construction to go up as it did, but an increase was expected.
“That’s where the economy has been over the last four years,” Krempa said.
The amount of sales tax incentives would be increased from $26 million to $29 million, though eliminating the mortgage recording exemptions means the total IDA incentive amount is around $123.4 million. The other incentives included $94 million in property tax exemptions, with Amazon agreeing to PILOT payments valued at $49 million over 15 years, paying $9.5 million in taxes after that. That still makes this development the recipient of the 11th largest Amazon incentive package in the United States, according to watchdog organization Good Jobs First.
Gabriele said that in speaking with other IDA attorneys in New York State about this, they did not recall such a request like this coming before them.
“Dozens of times, these requests come in,” Gabriele said, “the only difference is that it’s a four-year project, longer than what we normally deal with.”
Griggs added that Amazon is looking to start hiring for the fulfillment center within the next week and start operations before the end of the year. The 3.1 million square-foot facility plans to hire 1,000 employees for it, though the majority would be making about $15 per hour.
Krempa is happy with the progress made over there.
“If you drive down Lockport Road, you see this wonderful new facility that Niagara County wouldn’t have had if not for them coming through,” Krempa said.
A public hearing for these additional benefits will happen, with Gabriele saying it is for complete transparency despite not being required. The time, date, and place have yet to be determined.