South Carolina Must Keep Its Promise

By Lewis F. Gossett

Debate about extending the Jobs Creation Act for Amazon goes far beyond the Midlands, which stands to gain 1,200 full-time jobs with benefits, hundreds of seasonal jobs, and economic investment nearing $100 million.

How the General Assembly and Governor handle this project will affect every county’s ability to compete in the global economy for jobs and investment. If they fail to simply extend a tax provision that has existed for 5 years, leaving Amazon no choice but to go somewhere else, every state in the nation will have the same message for job creators large and small: If South Carolina will break its word to a world-class company like Amazon, they’ll do it to you.

Decades of work to make us a global player, from Carroll Campbell to Governor Haley, and heroic efforts by the General Assembly to make our laws business-friendly, will be compromised by a broken promise.

And make no mistake -- the outgoing administration promised Amazon reinstatement of a just-expired law that did not require online retailers to collect sales taxes from South Carolina customers. Secretary of Commerce Robert M. Hitt has said so.

Detractors can parse language in the formal agreement all they want, but the fact is that every major deal between the state and private companies contains a lot of formal language, as well as verbal agreements and handshakes. Company officials from well-publicized large projects in the Upstate and in the Charleston area also trusted state leaders to get incentive packages approved by governments at all levels. And it is true for Amazon.

Perhaps most disturbing, though, are the attacks on this particular economic development prospect. South Carolina has done a fantastic job over the years recruiting outstanding corporate citizens, and Amazon is no different.  Take a look:

•    CivilianJobs.com last year named Amazon one of the 25 most valuable employers for the military.

•    Forbes named Amazon the #1 most reputable company in the U. S. for customer service in 2011.

•    Fortune listed Amazon as one of the world’s most admired companies, and ranked Amazon in the top 8 companies for people management. It also ranked Amazon as one of the fastest growing companies.

•    Business Week ranked Amazon among the top 6 companies in the U. S. for innovation. The magazine also said Amazon was “one of the best places to launch a career."

•    Millwood Brown, a global research agency, ranked Amazon #1 in most trusted brands last year.

•    Universum listed the company as an “ideal employer for young professionals” this year.

•    According to the annual Harris reputation rankings, Amazon was ranked #2 in the country for customer trust and #4 for customer service.

It is fair to determine whether our economic development prospects are good corporate citizens, but we should stick to the facts.  You won’t find a company whose credentials and reputation are better.

Also lost in the controversy is the legislation that Amazon was promised. It is not a tax break for the company. Amazon would continue paying every penny of taxes it is paying now.

The issue has to do with whether an online retailer like Amazon should charge South Carolina customers a sales tax when it has no retail presence in the state. In such circumstances, the Supreme Court has ruled that online retailers cannot be forced to charge customers sales taxes.

South Carolina cannot put itself in the position of requiring the company to do what the Supreme Court has ruled against; it’s not fair to ask Amazon to spend $100 million to build a facility in a state that has not settled this issue.

Manufacturing in South Carolina routinely expands or locates in South Carolina in the same way as the Amazon project. We have to be able to rely on the promises made by State and local economic development recruiters. Additionally, we cannot set a precedent in this State where a company's competitors and/or enemies can derail an economic development prospect. Today, it's a competitor. Tomorrow, it could be organized labor or extreme environmental groups working to stop projects.  We must send a clear message that the serious business of bringing new jobs to South Carolina is not the place for that kind of gamesmanship.

Amazon is a worthy project, but to the South Carolina Manufacturers Alliance, much more is at stake here. We urge the General Assembly to keep South Carolina's promises to this company and to prevent outside interests from derailing an economic development project for their competitive interests. In doing so, our State will see a world-class company create 1200 jobs in the Midlands, and we will maintain our international reputation as a business-friendly environment.