Capitol Alert

The latest on California politics and government

By Dale Kasler and Torey Van Oot

Amazon.com is offering to bring 7,000 distribution center jobs to California in order to ward off a ballot-box fight over the state's new Internet sales tax, sources with knowledge of the talks said today.

While discussions are still preliminary, sources said legislative leaders have received an Amazon-inspired plan that would give the online retailer a two-year moratorium on the new tax. In return, Amazon would bring 7,000 jobs to the state, these sources said.

Amazon so far has refused to collect the tax, signed into law in June by Gov. Jerry Brown, and is collecting signatures to challenge the law in a referendum next June. Legislative Democrats, meanwhile, launched an end-around last week by pushing a new version of the law that wouldn't be subject to referendum. The new version would need two-thirds support of both houses, which means votes from Republicans.

It's unclear if the plan will take hold. Senate President Pro Tem Darrell Steinberg, D-Sacramento, said his "first priority" is to pass AB 155, the new version of the law.

"The state is owed $400 million over the next two years that we cannot afford to lose," he said.

The state believes the new law would generate $200 million a year in tax revenue.

Amazon officials couldn't be reached for comment. But George Runner, a member of the Board of Equalization and an Amazon ally, said he's encouraged that talks are proceeding.

"Whatever comes out of it has got to be about jobs," said Runner, whose agency is in charge of collecting sales tax from retailers. "How can we help Amazon create a bigger presence in California?"

Amazon has pledged to create distribution-center jobs in at least two other states that have agreed to a sales tax holiday - South Carolina and Tennessee.

The California Retailers Association, a coalition of big-box stores that has been pushing for the online tax, said it had seen Amazon's offer and deemed it unacceptable.

"We don't think it's a serious compromise, a serious proposal," said Bill Dombrowski, the association's president. "I don't think it's going to go anywhere."

He said the jobs offered by Amazon don't make up for the jobs brick-and-mortar retailers are losing because of the price advantage Amazon retains as long as it doesn't collect sales tax.



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