Amazon Nets $13 Million in Tax Credits From Illinois

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By Michael J. Bologna

Illinois will provide almost $13 million in tax incentives to Amazon.com Inc. to support the expanding electronic retailer as it develops two fulfillment centers in Aurora, a spokesperson for Gov. Bruce Rauner (R) told Bloomberg BNA.

Rauner said the Illinois Department of Commerce and Economic Opportunity had reached an agreement with Amazon, permitting the company to take advantage of the Illinois Economic Development for a Growing Economy (EDGE) Tax Credit Program. The agreement will grant Amazon tax benefits totaling $12.9 million over 10 years in response to the company’s commitment to create at least 1,000 new jobs during that period.

The Rauner administration’s acknowledgment comes one day after Amazon announced plans to significantly expand its operations in Illinois with two facilities in Aurora. The electronic-retailing giant plans to build a 1 million-square-foot fulfillment center used to warehouse, pack and ship small consumer goods. A separate 400,000-square-foot center will specialize in shipping and handling large items such as televisions.

7,000 Full-Time Jobs

Amazon had no physical operations in Illinois just two years ago. Since then, Amazon has announced plans for eight fulfillment centers. With the addition of the two facilities in Aurora, Amazon will soon have 7,000 full-time employees in the state.

“In just over two years, Illinois has proven itself to be an ideal location from which Amazon can continue offering customers our vast selection and superfast shipping speeds,” Akash Chauhan, Amazon’s vice president of North American operations, said in a statement.

The EDGE tax credit program offers targeted credits to businesses creating or retaining new full-time jobs in the state and making substantial capital investments. The program was developed 16 years ago to assist communities in direct competition with other states for economic development.

According to a 2015 commerce department report developed by the state, Illinois granted EDGE credits to 209 companies during the first 14 years of the program at a cost of $1.1 billion. The incentive program resulted in 34,465 new jobs and 41,996 retained jobs.

EDGE benefits are set to expire at the end of 2016, but lawmakers have discussed options for an extension. The Rauner administration is open to some type of extension, but is also interested in strategies that could restructure the program.

To contact the reporter on this story: Michael J. Bologna in Chicago at mbologna@bna.com

To contact the editor responsible for this story: Ryan C. Tuck at rtuck@bna.com

For More Information

The commerce department report is at http://src.bna.com/kWk.

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