A $1.5 billion Amazon air hub at the Cincinnati/Northern Kentucky International Airport received preliminary approval for $40 million in Kentucky tax incentives on Tuesday.
Amazon already employs 10,000 full-time workers in 11 fulfillment centers across Kentucky. The Kentucky Economic Development Finance Authority approved the tax incentives in a special meeting.
The air hub would serve a growing fleet of Prime Air cargo planes. Amazon’s Prime service charges customers an annual fee and then gives them free standard shipping on a large number of items including Amazon Prime Pantry, a grocery service. Paying the Amazon Prime fee also gives customers access to Amazon streaming television content.
“As we considered places for the long-term home for our air hub operations, Hebron quickly rose to the top of the list with a large, skilled workforce, centralized location with great connectivity to our nearby fulfillment locations, and an excellent quality of living for employees,” said Dave Clark, Amazon’s senior vice president of worldwide operations.
A news release from Amazon said that the company in 2016 entered into agreements with two carriers to lease 40 dedicated cargo airplanes for Prime shipping; 16 of the planes are now in service for Amazon customers, “with more planes rolling out over time,” the release said.
The Amazon hub in Northern Kentucky “will support Amazon’s dedicated fleet of PrimeAir cargo planes by loading, unloading and sorting packages,” according to the release.
Kentucky Gov. Matt Bevin said that the state is “truly grateful for the jobs and economic impact it will bring to the commonwealth.”
Candace McGraw, CEO of the Cincinnati/Northern Kentucky airport, said that “a vibrant airport improves the economic vitality of the region, and adding thousands of new jobs through establishing this hub .... will certainly be transformational for the local economy and local businesses.”
Cincinnati is among the cities that are now being offered the Amazon Prime Now service, which offers Amazon items, plus household essentials including groceries, health and beauty items, electronics, pet supplies and toys with free two-hour delivery. In some cities, such as Columbus, Ohio, Amazon is now offering one-hour delivery from “Amazon restaurants.”
The air hub in Boone County would be the largest single investment by a company ever in Northern Kentucky, followed by Delta’s $379 million hub expansion at the Hebron airport in 1993.
The Cincinnati/Northern Kentucky International Airport opened to commercial flights in 1947.
The hub will include 40 aircraft over 920 acres and will eventually hire 2,000, 600 full-time, according to Amazon. Releases from Bevin and KEDFA put the employee number higher.
The full-time employees will earn an average hourly wage of $26 including benefits.