FORT WAYNE, Ind. (WFFT) — Fort Wayne City Council voted against a tax break for Amazon Tuesday night during their meeting.
The proposal for the $7 million tax abatement for machinery failed by a 3-5 vote, with one council member abstaining.
Here's how everyone on the council voted:
- Voted No
- Jason Arp, Paul Ensley, Thomas Freistroffer, Russ Jehl and Sharon Tucker
- Voted Yes
- Michelle Chambers, Thomas Didier and Geoff Paddock
- Glynn Hines
Council already voted in favor of a tax abatement this spring for Amazon.
This would have been an abatement for machinery at the U.S. Highway 30 and Flaugh Road fulfillment center.
Councilwoman Michelle Chambers says the vote shouldn't change Amazon's decision to continue its course to Fort Wayne.
"I would encourage any business that's deciding to come to the city don't allow our citizen's tax dollars to be the breaking factor, allow it to be the thing that helps create economic development on based on need. So I am I'm confident that they will plan to come that's what was said tonight. So I welcome them to the city and I'm excited about the opportunity for people that have jobs," Chambers explained.
The tax abatement awarded to Amazon in the spring was $16 million for its construction.
Councilman Geoff Paddock issues the following statement to FOX 55 Wednesday morning following his vote:
"City government acquires most of its authority by enabling legislation from the State of Indiana. Policy granted in 1977, allows us to abate, or phase in, an added tax burden on a business or industry, that is located in a designated area and is bringing in added employment, high wages, and substantial real estate and business equipment.
The abatement on property taxes and on business personal property is for new tax revenue that would not be received if not for the new business or its expansion. This is a tool that was given to us so we could be competitive and score a win over another state. This is part of the economic development policy that I support, and I have worked to make it more accountable and to add a level of compliance.
The ordinance we updated in 2013 and again in 2019 has made the application for tax abatement more stringent. While it should continue to be our policy to grant it, we are also rightly being more vigorous in rescinding tax abatement incentives, when the compliance level is not met. I have voted to rescind dozens of these when the company did not meet the benchmarks we set. We will see this process come before us again soon.
Amazon did not seek tax incentives from the city on the two warehouses that are currently in operation. With this distribution center, the abatement formula was factored into the project so it could offer 1,000 jobs at good wages and benefits. The phase-in before us is important in seeing Amazon move forward with that commitment. The expectation helped them choose Fort Wayne instead of another state.
What we are being asked to do is follow a policy that I believe is good economic development policy. Going through the tax abatement process is rigorous and not inexpensive. In reviewing the score sheet, the applicant either meets or exceeds the requirements that we set in our ordinance. Our reputation as an honest broker may be on the line. If we do not follow through, a city in another state may offer a better incentive and we might lose the next company that wants to bring in another 1,000 jobs.
The phase-in of this business personal property tax helps implement automated machinery and sophisticated robotics that will actually help to solidify these jobs and make them safer and more sustainable for the future, adding longevity to the plant. This is not unlike other tax phase ins that we have granted for BAE Systems, Dana Corporation, Fort Wayne Metals, and Sweetwater Sound.
I understand the hesitation here and the opposition. Like you, I witnessed the former Chief Executive Officer riding in his rocket and spending millions of dollars. The optics are not good, and we are hearing from citizens who are not happy. In fact, they are infuriated. However, our policy must apply to everyone fairly and evenly. The City of Fort Wayne is not writing a check to anyone. We are phasing in a tax obligation that will be paid to us over a period of years, and we are keeping a commitment through this ordinance, that was revised a few years ago.
With my vote, I also add this. I care about the way you treat your employees, the wages you pay, the benefits you provide, and your willingness to be a good corporate citizen. Most important will be how you meet the requirements that accompany this tax phase in. If you do not meet them, we will rescind it.
I believe our policy and how we have administered it over the years, helped this company to factor the size of its operation, the number of employees, and the amount of employee benefits, just like any other similar applications. I will vote yes."