Macy’s Inc. could receive up to $21 million in tax breaks and incentives for its $170 million order fulfillment center to be built in Tulsa County, according to public records.
The Tulsa World reported Sunday the largest of those tax breaks would come from Tulsa County, pending approval from county commissioners. The commissioners recently agreed to pursue the creation of a Tax Incentive Finance District that would exempt Macy’s from property taxes on new construction for four years at its planned site for the center.
The county assessor’s office estimated that the company could save more than $1.7 million per year — or more than $8.75 million over the life of the tax abatement. Under Oklahoma’s incentive program, the state will pay Tulsa County the taxes that would have been owed by Macy’s.
Macy’s property-tax exemption will be extended another five years, from 2021 to 2025, through the state’s Manufacturing Exemption Program.
Kenny Chuculate of the Oklahoma Tax Commission said the state’s exemption likely would be slightly less than the county’s exemption due to depreciation.
“We would automatically depreciate those (properties) by one year,” he said.
Some critics of property-tax abatement program say exempting large retailers from paying taxes shrinks the pool of taxpayers, which can lead to a bigger hit for property owners. But County Commissioner John Smaligo said that’s not the case with the Macy’s center, noting that the project will pay millions of dollars in salaries and payroll taxes for years.
“The situation is simple: a successful company was going to expand somewhere in our region, and we were able to convince them to choose our community in large part due to these incentives,” Smaligo said.
Macy’s, which plans to hire about 1,500 workers at the Owasso center, also will receive up to $1.5 million from the Governor’s Quick Action Closing Fund. The company also is set to receive smaller incentives from the Oklahoma Department of Transportation and the Cherokee Nation for the project.