Amazon and the builder of a massive warehouse in Gates to house the online retailer are seeking tax breaks from Monroe County for an enterprise that would create 1,000 jobs over three years after the project is completed.
Whether those jobs will represent equity in hiring remains an open question.
Amazon.com Services LLC would lease the approximately 2.6 million square-foot facility from USRE Manitou of San Antonio, Texas, which would build and own the structure. The entities are co-applicants to the County of Monroe Industrial Development Agency for an agreement called payment in lieu of taxes (PILOT).
According to the application, Amazon and USRE Manitou said there is “a likelihood that the project would not be undertaken but for the financial assistance provided by the agency.”
The application did not appear to spell out how equity in hiring would be achieved.
A public hearing is scheduled for 11:15 a.m. Jan. 15 via livestream on the COMIDA-Imagine Monroe YouTube channel. Written comments will be accepted on that platform in real time. COMIDA also will provide access to oral comments via Zoom or by calling (929) 436-2866 and using the meeting ID 889 3946 5927 and passcode 948634.
The entities are seeking a sales and use tax exemption for the purchase of certain machinery and equipment that will be installed in the facility. According to the application, the value of incentives was placed at $142.9 million. The application said 34% of the project costs would be financed from the public sector.
When Minority Reporter first reported in October that a distribution center/warehouse was being considered for land at Rochester Tech Park and that a large online retailer such as Amazon was thought to be the prime tenant, it raised questions about equity in hiring.
According to the application, USRE Manitou and Amazon projected employment at 1,000 full time and part time jobs three years out. The application said wages “will be competitive and provide for full benefits,” including medical, dental vision, 401k and vacation.
The application also estimated 300 temporary construction jobs.
In a general description of the project and the background of the users of the facility, the application states that Amazon “continually looks for ways to continue to diversify its workforce and strengthen its culture of inclusion. … (Amazon) hosts ongoing learning experiences including Conversations on Race and Ethnicity … . (Amazon’s) focus on diversity and inclusion has been independently recognized as one of the best places to work on Human Rights Campaign’s Corporate Equality Index and LinkedIn’s Top Companies, recognized on the NAACP Equity, Inclusion and Empowerment Index … .”
The application does not appear to make any firm commitments about minority hiring.
Equity, diversion and inclusion have been talked about at the city and county level. But those actions targeted public projects. There may be less leverage with private employers, unless they are asking for tax breaks and public money to help with their projects.
Speaking in general about PILOT agreements, former Rochester Mayor Bill Johnson said, “When developers or business owners seek public financing through tax abatements and waivers, or specific funding that is designed to incentivize economic activity (job creation, reuse of vacant buildings and land, retaining an existing business, etc.), the government offering these abatements and incentives must get something of tangible benefit in return. The return must be commensurate with the amount of public investment. Oftentimes, that is not the case.”
Johnson is a chairperson of the RASE Commission, a city/county partnership addressing the range of inequities that affect the lives of people of color in Monroe County.
Johnson said that because developers and businesses are looking for the best deal possible, “there is no loyalty to any locality. If governments don’t offer a good deal, and the developer can get it from a neighboring municipality, or from a neighboring state, they will go where the best deal can be advanced. The level of competition is intense, and poorer jurisdictions can never effectively compete, unless they are willing to break the bank and offer more than they can really afford.”
In requesting financial help from Monroe County, the application said Amazon is “evaluating whether the project improves its competitiveness and provides its customers with low prices, vast selection, and convenience.”
The application said Amazon reserved the right to finalize the decision subject to evaluation of “alternative opportunities addressing its entire network, which includes, but is not limited to, costs, economic incentives, transportation efficiency, location/infrastructure, design of building type, available workforce, allocation of corporate capital and ultimately, receipt of senior management approval.”
The application said Amazon evaluates dozens of locations in any given year in response to increasing customer demand. The cost-benefit analysis of selecting any one particular site is weighed against its network, and a potential site is evaluated against alternatives nationwide that make best use of the network.
“Ensuring equity in hiring practices is critically important in growing a diverse workforce,” said Marc Cohen, chief of staff for Bob Duffy, president and chief executive officer of the Greater Rochester Chamber of Commerce. “Rochester Chamber employs these practices and we expect the same from any employer looking to set roots in this region.”
An analysis by the Center for Governmental Research determined the economic benefit to the state and region over the life of the project at more than $1 billion. The benefits include payroll, property tax and sales tax revenue. CGR put the benefit-to-cost ratio at 8-to-1.
The project would have to be approved by the Monroe County Legislature.
Amazon previously announced a smaller facility in Greece.