Amazon Warehouse Seen as Potential Revenue Lifeline in Tight County Budget

Amazon logo superimposed on an artist’s perspective of the Amazon site.

A Humboldt County supervisors has said an Amazon distribution center slated for McKinleyville will bring much-needed sales tax revenue into the county’s budget.

The new development was discussed as the Board of Supervisors fielded a mid-year budget presentation at its Feb. 10 meeting.

Assistant County Administrative Officer Jessica Maciel said budget spending is expected to exceed income by about $11 million for the fiscal year ending in late June.

It’s less of a deficit than forecasted and while property tax and other revenues have risen, sales tax revenue has been declining and is now flat.

Supervisor Steve Madrone said the county loses sales tax revenue when residents shop online instead of locally. He added that sales tax revenues from online shopping go to the communities where distribution centers are located.

And he suggested the county’s sales tax scenario could change soon.

“If there’s going to be this trend of shopping online, well maybe we ought to have a distribution center so that we get more of our share out of that,” said Madrone. “In fact, there’s one being proposed in McKinleyville at the Airport Business Park as we speak.”

Madrone alluded to social media “chatter” about it but it’s more than a mere rumor.

Redheaded Blackbelt posted an initial report on Feb. 7 confirming that a building permit has been filed and the applicant is a firm “widely known for developing projects for Amazon.”

On Feb. 13, the Lost Coast Outpost reported that the distribution center is indeed one for Amazon, as confirmed by the company in a written statement.

Madrone envisions jobs and tax revenue. “That new distribution center would probably increase our sales tax in the county because that’s in the unincorporated area,” he said.

Asked to confirm if an Amazon distribution center would increase the county’s sales tax revenue, Maciel said, “based on counties with distribution centers currently, I would say most likely, yes.”

Sales tax revenue funds Measure Z, the county’s public safety services fund, which is expected to bring in as much as was forecasted for the current year, about $13 million.

And there was discussion about reducing administration of Measure Z, as now the fund mostly continues paying for previously-funded requests and there’s little room for new ones.

Supervisor Natalie Arroyo wants the community to be made aware of the minimal wiggle room.

“All of our community are losing revenue right now from grant funding sources,” she said. “And I think more of them than usual are looking to Measure Z with hopefulness around one-time funds to continue doing some really meaningful work. So I would want to be able to convey that message, that we expect that to be a much, much smaller pot.”

The tight budget scenario includes leaving positions unfilled.

The increased workload taken on by county employees was noted during a public comment period.

“I can tell you right now that my members feel like they’re being asked to do more with less,” said Drew Redden, the business agent for the county’s employees union. “And we need to do less with less, if we’re going to have less.”

He added, “the expectations that exist for employees is too high for folks – they’re burning out, they’re going away.”

Supervisor Michelle Bushnell said the county “just doesn’t have the funding” to fill the vacant positions and “that goes back to the conversations about having to do more with less.”

Madrone described the situation as “a complicated process” that’s not ideal.

“I think most of the board would really love to see better compensation for all our employees, that’s a real thing,” he said, adding it should be addressed “not with overworking people but by trying to attract folks that are highly productive.”

Supervisors approved a series of modifications to the budget, including increasing the amount of General Fund allocations to county departments by five percent due to what a written staff report describes as the fund’s “improved status.”