published Thursday, December 2nd, 2010

County baits hook for Amazon


by Dan Whisenhunt
Audio clip

Commission meeting - 12/1/2010

Hamilton County commissioners sweetened the deal for Amazon.com on Wednesday, approving the county's portion of millions in tax incentives.

Along with Chattanooga and Bradley County, Hamilton is hoping to lure the Seattle-based company into building two distribution centers, one in Hamilton and one in Bradley.

The incentives, including state grants, job-creation and property tax credits and money for employee training assistance, are worth more than $30 million total for both sites.

An Amazon official said he is grateful for the commission's offer but indicated that negotiations are ongoing and there are other competing, undisclosed sites.

"We would hope to finish negotiations before the end of the year," Fred Kiga, Amazon's director of policy, said after the commission meeting.

Under the 11-year agreement, Amazon would get a break on its property taxes for its 80-acre site in the Enterprise South industrial park, but it would pay 100 percent of the schools' share of the tax.

The county is giving up $435,884 in tax revenue per year, and receiving $429,624 in school taxes. The city will give up $722,716 in tax revenue per year.

The agreement, approved unanimously by the nine-member commission, was the same deal approved Tuesday by the Chattanooga City Council.

The facility in Bradley County is expected to employ 226 people, plus up to 600 to 800 seasonal workers, according to Douglas Berry, the vice president of economic development for the Cleveland Bradley Chamber of Commerce. Berry said Bradley County plans to offer a 50 percent property tax break for 10 years worth $2.5 million. He said the state also plans to allocate Bradley County $2.2 million in economic development grants.

The incentives are a draw for the company, Kiga said.

"They do play a role in the overall economic costs of standing up a facility," he said.

The proposed centers are expected to bring 1,249 full-time jobs to Hamilton County, but that number would swell during the holidays to more than 2,000, Kiga told commissioners. He said the average annual salary would be $30,500, not including the cost of benefits.

Trevor Hamilton, the vice president of economic development for the Chattanooga Area Chamber of Commerce, said Hamilton County's and the city's portion of the incentives are worth a combined $9 million.

The Hamilton County site would handle shipping of smaller items, while the Bradley County center would handle larger items, Chattanooga Mayor Ron Littlefield said.

When asked if the community can afford to offer tax breaks to private companies during an economic lull, Littlefield said "yes."

"Employed people pay taxes," he said.

Commission Chairman Fred Skillern said luring Amazon is "just a piece of the puzzle."

"This makes our (economic) base a lot more diverse," Skillern said.

Staff writer Dave Flessner contributed to this story.

about Dan Whisenhunt...

Dan Whisenhunt covers Hamilton County government for the Times Free Press. A native of Mobile, Ala., Dan earned a degree in broadcast journalism from the University of Alabama. He won first place for best in-depth news coverage in the 2010 Alabama Press Association contest; the FOI-First Amendment Award in the 2007 Alabama Press Association contest; first place for best public service story in the Alabama AP Managing Editors contest in 2009 for economic coverage; and ...

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Comments do not represent the opinions of the Chattanooga Times Free Press, nor does it review every comment. Profanities, slurs and libelous remarks are prohibited. For more information you can view our Terms & Conditions and/or Ethics policy.

This story reminds me of the early days of the aqaurium after Mr. Lupton made the downtown revival a reality. Local politicians were out in droves grabbing credit for the ancillary developments that came afterwards.

So how's the coat tail ride, Mr. Littlefield?

December 2, 2010 at 8:16 a.m.
mrredskin said...

we've already been complaining, yet the TFP edits a sentence or two and then deletes all previous comments

December 2, 2010 at 12:52 p.m.
Allison12 said...

BookieTurnersGhost You have the coolest user name in town. Very creative, wish I would have thought of that. Can a user name be changed on an acct? I have an idea. On the other issue, you continue to use the aquarium in comparison the taxpayer funding of private corporation growth. Like Bookie Turner I was around then, and the aquarium was NOT a taxpayer funded effort. Free enterprise is not taxpayer funded and does not require property taxes. VW and Amazon facilities are government subsidized business, and mimic a stimulus/tax based economy. I am allowed to object every day of the week about local property taxes and stormwater fees being forcefully taken from me to provide growth opportunities for VW and Amazon. VW received $212 million in local taxpayer funding, and a direct bond issue of $40 million plus millions more from our local infrastructure funding. Small business and home owners are being forced to subsidize VW share of services and stormwater fees for 30 years. I object to being forced to give my hard earned dollars to VW and Amazon. I am allowed to object to giving my property taxes a foreign corporation, when these are for services.

December 2, 2010 at 1:09 p.m.
walther said...

Has anyone commented that when Amazon establishes a physical presence in TN, Tennessee residents will have to pay the sales taxes on Amazon purchases. TN Dept of Revenue will be able to force them to collect.

December 2, 2010 at 3:27 p.m.
XMarine said...

The Aquarium has received state tax dollars.When they were remodeling a payment of appx $900,000 was doled out to them.

December 2, 2010 at 3:42 p.m.

Walther, The answer is yes. Tennessee residents will be subject to the consumer sales tax on Amazon sales.
XMarine, you are wrong the Aquarium is a registered non profit and is not subject to property taxes. They recieved an enhancement pass through from the federal. NO local property taxes have been used for the aquarium.

December 2, 2010 at 3:50 p.m.
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