Amazon is seeking more than $124 million in tax breaks from Niagara County to support a distribution facility in the Town of Niagara, the anticipated cost of which now exceeds $450 million.
The Seattle-based company and its developer, Atlanta-based JB2 Partners, are asking the Niagara County Industrial Development Agency to approve the package of sales, mortgage recording and property tax breaks. The agency will take up the application Wednesday morning, and will set a public hearing in early August before voting on the request Aug. 10.
But agency officials already are talking about the unprecedented scale of the project, and its projected $1.286 billion impact on the community, both directly and indirectly.
“The local benefits on cost-benefit analysis blows away anything we’ve ever had,” said NCIDA general counsel Mark Gabriele.
Amazon has filed plans to construct a 3.08-million-square-foot distribution facility and hub on a portion of 217 acres of land adjacent to the Niagara Falls International Airport and Niagara Falls Air Reserve Station.
The proposed five-story “e-commerce storage and distribution facility” at 8995 Lockport Road would employ more than 1,000 people working in two shifts 24 hours a day – but no more than 1,800 at any one time, according to the site plan application previously submitted to the town, and now under review for potential final approval later this month.
The long-awaited project – virtually identical to what Amazon previously proposed for Grand Island, but with a 50% higher cost estimate because of soaring material and supply costs – would represent the biggest private-sector investment ever in the Town of Niagara, and one of the the largest in the county since the Niagara Power Project in the 1950s. It also would make Amazon one of the county’s biggest employers.
Some local residents have said the project will generate too much additional traffic, safety and environmental concerns, in an area that is already heavily congested, primarily with a busy retail corridor dominated by the Fashion Outlets at Niagara Falls, as well as multiple commercial and industrial operations focused around the airports. But the town approved a mandated environmental review with a “negative declaration” of impact.
Plans call for construction of the enormous facility on 111 acres of the property, consisting of four parcels bounded by Lockport, Packard and Tuscarora roads, and Haseley Drive, with the former Niagara Drag Strip cutting across the southern portion of the land. Owned by Gotham Homes 18 LLC, it’s a vacant site that is already zoned for heavy industry, was designed by the state as a “shovel-ready” development site a decade ago, and was promoted to Amazon by the town.
The Amazon.com Services operation would function as a first-mile fulfillment center to receive bulk shipments of products from vendors, suppliers and sellers, and then package them for the first leg of delivery. It would feature 650,000 square feet on the ground floor and 606,750 square feet on each of the upper four levels. The facility would include 55 loading docks, along with 469 parking spaces for trailers, 1,755 spaces for cars and 16 for motorcycles, plus two guard stations and two water tanks.
According to the NCIDA application, the total cost of the project is $450 million, including $225 million in purchases for construction and $100 million for the robotic equipment that will be installed. Amazon says it plans to obtain bank financing for $473 million, while investing an additional $77 million, for a total of $550 million in funds.
The company is seeking $26 million in sales tax breaks through 2026 and $3.55 million in savings on mortgage recording taxes from the NCIDA, plus a 15-year payment-in-lieu-of-taxes on the property. With a projected property value of $375 million, and the structure of the PILOT, that yields another $94 million in savings on property taxes, Gabriele said.
The property tax benefit calls for payments of just 10% of regular taxes for the first six years, and then rising by 10 percentage points per year until reaching full payment of $9.53 million annually.
Gabriele said that’s not a deviation from a standard benefit because Niagara County’s uniform tax-exemption policy gives the agency flexibility to adapt PILOT arrangements for individual projects. And the 15-year term is typical for warehouse and distribution projects in Niagara County, he added. Nevertheless, the term is longer than allowed in Erie County, and the percentage terms are more lucrative than normal.
However, it’s identical in structure to what was followed in Syracuse’s Onondaga County for a similar project that finished in May, and for an ongoing project in Rochester’s Monroe County. That was done deliberately, Gabriele said, to keep things consistent.
The company is seeking $26 million in sales tax breaks through 2026 and $3.55 million in savings on mortgage recording taxes from the NCIDA, plus a 15-year payment-in-lieu-of-taxes on the property. With a projected property value of $375 million, and the structure of the PILOT, that yields another $94 million in savings on property taxes, Gabriele said.
The property tax benefit calls for payments of just 10% of regular taxes for the first six years, and then rising by 10 percentage points per year until reaching full payment of $9.53 million annually.
Gabriele said that’s not a deviation from a standard benefit because Niagara County’s uniform tax-exemption policy gives the agency flexibility to adapt PILOT arrangements for individual projects. And the 15-year term is typical for warehouse and distribution projects in Niagara County, he added. Nevertheless, the term is longer than allowed in Erie County, and the percentage terms are more lucrative than normal.
However, it’s identical in structure to what was followed in Syracuse’s Onondaga County for a similar project that finished in May, and for an ongoing project in Rochester’s Monroe County. That was done deliberately, Gabriele said, to keep things consistent.
