Amazon bails out on plans for Midlands warehouse
Thu, 28 Apr 2011 15:19:35 GMT —
COLUMBIA (WACH) -- Amazon is bailing out on plans to build a distribution center in Lexington County after the House turned down a tax break deal Wednesday.
Amazon vice president Paul Misener says he doesn't expect negotiations to continue and 1,250 jobs and over $100 million in investments will go elsewhere.
"It was made quite clear that Amazon had canceled the contract and that there was no possibility that Amazon would be returning to Lexington," says Scott Adams, Greater Lexington County Chamber of Commerce.
The tax break proposal that would give Amazon a five-year exemption from collecting sales taxes from South Carolina shoppers failed on a vote of 71-47 . That deal was made under former Gov. Mark Sanford.
A promise was made and the general assembly has elected not to honor that promise and I think that there will be repercussions in the economic area for years to come," says Adams.
After the House shot down the tax break, Misener announced $52 million in contracts were canceled, and all job postings were removed.
Adams says not only does the area lose about 12-hundred jobs but another company was planning on locating next to the online retail giant.
"These jobs would have been engineer positions and they would have been in excess of a thousand jobs, that would have been adjacent to the Amazon investment, says Adams.
Gov. Nikki Haley says she's focused on keeping a fair market in our state and keeping the companies that are here happy. Watch the video below provided by the governor's office for Haley's entire statement at a Free Enterprise Foundation Awards luncheon.YouTube
Supporters say South Carolina needed to honor the deal made by the Commerce Department under Sanford. They said it would otherwise give the state a reputation of not keeping its commitments, and hurt the state's ability to attract employers in the future.
Large and small competitors say they collect sales taxes and Amazon would get an unfair advantage if it doesn't.
One area political scientist says this situation may serve as a textbook lesson.
"Is this an isolated incident or does it really reflect a changing of attitudes with the general assembly where we should already consider what TMs already in the tax structure," says Dr. Robert Oldendick, University of South Carolina political scientist.Related Stories... House shoots down Amazon tax break; 1,000+ jobs up in the air SC groups want more economic deal disclosure Senate committee approves Amazon tax break
South Carolina Gov. Nikki Haley didn't support the deal but said she would let it become law without her signature.
What sort of message does Amazon announcing it is bailing out on plans to build a Lexington warehouse send to companies considering bringing business to South Carolina? Vote in our poll below and leave a comment to weigh in.
(The Associated Press contributed to this report.)