Amazon Plans $255 Million Connecticut Fulfillment Center
Online retailer Amazon.com Inc. is planning to build an 855,000-square-foot fulfillment center on the former Pratt & Whitney site in North Haven, Conn., Gov. Dannel Malloy announced June 8. The move is expected to add 1,800 jobs.
Just hours after Malloy’s announcement, the town’s Board of Selectmen approved a pair of resolutions authorizing local financial incentives for the $255 million project. The board unanimously approved a seven-year phase-in of local taxes for the Amazon project — and a reduction in building permit fees with 2 in favor, none against and one abstention.
Construction of the fulfillment center, which will make widespread use of the latest in warehousing robotics, is expected to start within a week, according to First Selectman Mike Freda. Construction of the facility is expected to take between 12 months and 18 months, Freda said.
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“This is the culmination of a very complex and detailed negotiation that began two years ago,” he said. “This required the cooperation of not only several state agencies, but various town departments, as well.
The new facility will add to Amazon’s presence in Connecticut. The company recently opened a fulfillment center in Windsor and also has a sorting center in Wallingford. With the addition of the North Haven facility, Amazon will increase its Connecticut workforce to 3,800.
“This is a significant win for our state’s taxpayers and our economy,” Malloy said in a statement. “Amazon’s $255 million investment to expand operations in Connecticut is proof positive that when we work with companies and bring our collective ingenuity to bear, we deliver on creating jobs for the hardworking residents of our state.”
Freda said seasonal hiring increases by Amazon, during peak demand periods for the retailer, could increase the roughly 1,800 jobs that the company has told state and municipal officials would be generated. John Stafstrom Jr., a Bridgeport-based attorney who represented Amazon on its Windsor project and on its latest deal, told selectmen that the employment impact from the North Haven complex “could be a significantly larger number of jobs” than what is currently being projected, Amazon’s North Haven fulfillment center will be located at 415 Washington Ave. The 168-acre property had been home to a Pratt & Whitney plant and has been vacant for more than 15 years.
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“Five years after announcing our first fulfillment center in Connecticut, we’re excited to open a new, state-of-the-art fulfillment center in North Haven, creating more than 1,500 full-time jobs that offer wages 30% higher than traditional retail roles and include comprehensive benefits on day one, bonuses and stock awards,” Akash Chauhan, Amazon’s vice president of North America operations, said in a statement. “We’ve found an abundance of talent in Connecticut’s workforce, and we are so happy to have this opportunity to expand in the state to serve customers.”
Money from the state Department of Economic and Community Development, or DECD, is making the deal possible.
The company will be eligible to earn up to $15 million in Urban and Industrial Sites Reinvestment tax credits if certain job creation and capital investment goals are reached. An additional $5 million in credits may be available if initial job targets are surpassed.
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Amazon also may be eligible for a sales and use tax exemption of up to $5 million on equipment and construction materials from the state.
The town is providing incentives of its own: A seven-year phase-in of local real estate and real property taxes on the Amazon facility and a 50% reduction in permit fees, Freda said. Even with those incentives, he said the town is expected to see an average of $5 million in annual local real estate and personal property taxes as well as a one-time influx of $1 million building permit fees.
But a dispute over the amount of building fees the project will generate even after the 50% reduction kept the board’s vote from being unanimous.
Sally Buemi, a Democrat, said Freda’s estimate of $1 million in permit fees from Amazon after the one-time reduction is misleading. The actual amount that North Haven will get from Amazon is $600,000, Buemi said.
Freda said the $1 million estimate is based on what Amazon will pay in permit fees plus additional fee income from “five other economic development projects that we’ve got in the pipeline that are just waiting to see what happens with this one.”
“They’re all along Washington Avenue [near the Amazon project],” Freda explained. “The permit fees we’ll get from those projects will get us to $1 million.”
Buemi said she is not opposed to the Amazon project.
“I think it will be great for the town, so I didn’t want to vote against the fee abatement resolution,” she said. “I thought abstaining in that vote was an appropriate response to show my displeasure about not getting the amount we were told we would be getting.”
DECD is administering the incentives the state is offering under its First Five economic development program.
DECD Commissioner Catherine Smith said Amazon’s new facility puts a property that was once important to state’s economy back to use.
“The property, once humming with thousands of workers from Pratt & Whitney, was sold more than 15 years ago and has remained idle and vacant ever since,” Smith said. “This is a significant development that will bring jobs, economic activity and tax revenue for the town, region and the entire state.”
“Amazon’s decision to invest 1,800 new, good-paying, jobs in North Haven is a victory for the Greater New Haven area,” Senate President Pro Tempore Martin M. Looney, (D-New Haven), said in a statement. “Connecticut’s partnership with Amazon has already yielded thousands of jobs and I want to thank Gov. Malloy, his administration and local officials for their work in making this agreement possible.”
“This is exciting news for the State of Connecticut and Town of North Haven,” Senate Republican President Pro Tempore Len Fasano (R-North Haven), said. “I thank the governor’s administration and town officials for working in collaboration with all parties including state lawmakers and community members to show Amazon the remarkable potential of our town to be a new hub for business growth. After seeing this piece of property remain vacant for so many years, this new development is a major accomplishment.”
To alleviate concerns about increased traffic, Freda said a second entrance is being added to the old Pratt & Whitney property.
Valley Service Road, currently a cul-de-sac that runs parallel to the southbound side of Interstate 91, will be extended into the Amazon complex. That will allow trucks to access the facility from the old Pratt & Whitney entrance on Washington Avenue as well as from the south, with the Valley Service Road leading to the Exit 11 southbound on-ramp for I-91.
“The amount of traffic that we’ll see from this project will be about the same as it was when Pratt & Whitney was operating there,” Freda said.
