County approves Amazon tax break

Harris County commissioners voted Tuesday to grant Amazon a tax break to build a warehouse and fulfillment center that would employ 1,000 people in north Harris County.

The abatement, which passed unanimously after no one spoke out during a public hearing on the matter, would save the online retail giant an estimated $179,073 annually for 10 years while adding millions more than that to local tax coffers, according to a report prepared for Commissioners Court.

The deal is only the fourth tax abatement granted in Harris County since 2012, economic development director Annie Yang said. Earlier this year, commissioners signed off on a tax break for UPS, she said.

“It does not happen very often,” she said, adding that the Amazon deal also is more generous than usual.

Under the agreement, Amazon will invest $136 million to build an 855,000-square-foot warehouse in the Pinto Business Park at the southwest corner of Interstate 45 North and Beltway 8. The report for commissioners says the project will increase the property’s value by $116 million. In return, the county will waive 65 percent of taxes on $82 million of that increase.

Yang said previous abatements were for just 50 percent, but the companies involved had promised to add far fewer jobs.

The report also estimates Amazon would pay $393,314 in annual taxes on a completed project, compared with the $61,012 the property at Pinto Business Park is earning now.

Still, local economist Bill Gilmer, director of the University of Houston Bauer Institute for Regional Forecasting, expressed skepticism.

“It’s called economic development, but it’s actually

a game that companies and cities play,” he said. “It’s a way to make sure cities don’t act like a monopoly and take advantage of taxing power.

But most logistical facilities are there on the north side of Houston, so I still have to be a little bit skeptical.”

Competition to lure the center was another factor in the decision, said Mark Seegers, spokesman for Commissioner Jack Cagle, who represents the precinct where the facility would be built. Amazon claimed, according to county documents, that it had alternative sites with lower tax rates in mind at its facilities in Haslet and San Marcos and an out-ofstate site.

A representative for Amazon could not be reached for comment.

The fulfillment center would include warehouse and distribution space meant to serve the region surrounding Harris County.

The report to commissioners estimates the center would have annual economic impact of $172.9 million.