Amazon to Build Second Cleveland Center, Fifth in Ohio

Daily Tax Report: State provides authoritative coverage of state and local tax developments across the 50 U.S. states and the District of Columbia, tracking legislative and regulatory updates,...

By Alex Ebert

They’re multiplying.

Amazon.com Inc. announced Sept. 28 that it will develop its fifth Ohio fulfillment center—the third it’s announced in Ohio in just 34 days—raising the possibility of millions more in state and local tax incentives.

The state didn’t immediately respond to a request for comment into whether Amazon has requested tax incentives or how much the online retail behemoth could get in exchange for job creation. However, Amazon promises its facility planed for the west-Cleveland suburb of Euclid will bring more than 1,000 jobs, and similar projects have brought the online retailer millions in incentives in a range estimated between $3.7 million to $7.5 million.

The new center may help the state in contending for Amazon’s second headquarters. Several states and cities are already raising their hands in the race, including: Delaware, New Jersey and Rhode Island; Austin, Texas; Chicago; Detroit; Hartford, Conn.; Memphis, Tennessee; Philadelphia; St. Louis; and Tulsa, Okla.

Local Incentives

Amazon’s planned 650,000-square-foot facility on the site of a defunct Euclid shopping mall qualifies for the city’s 100 percent, 15-year property tax abatement program. That program is a carry-over from previous state law, where city and county developers can approve the incentive without the need of council approval.

“The Euclid Square Mall site has been a prime target of our redevelopment efforts,” Euclid Mayor Kirsten Holzheimer Gail said in a Sept. 28 statement. “While some saw a vacant mall, we saw an opportunity for growth and development.”

The retailer submitted an application for the credit earlier this month, Jonathan Holody, city planning and development director, told Bloomberg BNA. He said that’s the only incentive the 47,000-person city promised Amazon, and the city is uncertain how much the abatement would save the company.

State Incentives

The announcement is another expansion to Amazon’s burgeoning footprint in the Buckeye State.

Without considering the Euclid development, Ohio has signed incentive agreements with Amazon worth an estimated $29.4 million. Those estimates are based on projected hiring figures of only 5,150, and if Amazon beats those projections, it nets greater incentives.

Although Amazon won’t report most of its job-creation figures to the Ohio Tax Credit Authority until next spring, the company said it’s already created 4,500 jobs at its two Columbus-area fulfillment centers—500 more jobs than projected—and the company has hired 120 employees to operate its New Albany, Ohio data center.

To contact the reporter on this story: Alex Ebert in Columbus, Ohio at aebert@bna.com

To contact the editor responsible for this story: Jennifer McLoughlin at jmcloughlin@bna.com

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