My County Just Got A New Facebook Datacenter (And You Should Want One Too)
The governor announced it. . .on Facebook, of course.
Today, I have the privilege to announce that Facebook will construct a 970,000 square foot state-of-the-art data center on nearly 500 acres in Eagle Mountain.
Almost immediately, the complaints started. The complaints spanned a gamut of issues.
– It’s going to increase traffic
– It’s only going to employee 30-40 full time people
– It’s going to use our water
– It’s going to pollute our air
– They got $150 Million in unfair tax incentives over 20 years
I love my adopted state, but sometimes our citizens can be somewhat NIMBY (Not In My Back Yard.) They are failing to understand that this new building will be almost universally beneficial for Utah.
Here are the details according to the governor’s Facebook post.
– Capital expenditure will exceed $750 million
– Infrastructure development will exceed $100 million
– Will increase the property tax generated by 1.2 million percent in excess of any incentives
– Property taxes on the land will increase from $50 of annual tax revenue to $500,000 for our schools
– Will bring power, water, data, sewer and roads to an area well-off the I-15 corridor that previously had little or no other opportunities for development
Having this datacenter in Utah will be all kinds of good. And given the right deal, other communities would do well to lure these type of projects. Here’s why.
Traffic
I find it funny that some of the same people complaining about the low number of permanent jobs, want to also complain about the increased traffic on I-15, our major North-South freeway in Utah.
Of course construction will increase traffic, but once the datacenter is up and running, it doesn’t seem like 30-40 fulltime employees are going to make much difference on a freeway that carries thousands every day. Maybe we can incentivize the employees to carpool and get it down to only 15-20 additional vehicles on the road.
ONLY 30-40 Fulltime employees
I’ve never understood the complaint that a program will only bring a few dozen jobs to an area. Would the area be better off without those fulltime jobs? Sure, maybe you think the other costs are too high, and I’ll talk about those in a minute, but the argument that only a few dozen people are going to get fulltime work makes no sense.
Datacenter technicians make $50,000-$80,000 per year. Managers make $80,000-$120,000. Those people are going to buy houses and cars. They are going to shop in our stores. They are going to spend money at Jazz basketball games and Real Salt Lake soccer games.
Facebook assumes they will most likely hire more than 30-40, and as they expand the site, they will, of course hire more employees as well.
Water and Power
In the desert, water is life. Water concerns permeate all aspects of our lives here in the high desert. Much of the infrastructure improvements Facebook will make will be to get water and power to their site.
Datacenters take a lot of power and a depending on the design, a lot of water. Once a datacenter is completed, power is typically its single biggest expense. As a result, datacenter architects spend a lot of time thinking about power.
A few years ago I toured the eBay datacenter in Salt Lake City. The work they were doing to reduce power were everything from cutting edge, to kind of quirky. For example, eBay used water to cool some of their server racks. They then piped that hot water underneath their sidewalks to keep them clear of snow in the winters. The most innovative design I saw was that all the server racks were white. The guide explained that the white ones cost the same as the more common black ones. But, by making his server racks white, he could reduce his lighting by 30% and thus save additional energy.
Datacenters use a lot of power and water, that’s true. But, they are also amont the most innovative and “green” buildings I’ve ever seen.
Those $150 million Tax incentives
But, everything comes at a cost, right? Sure, the city of Eagle Mountain and the Alpine School District get some advantages, but it comes at a cost.
Critics will ask, “Why should Facebook get an unfair tax advantage? Why shouldn’t they have to pay their fair share?”
This is often the argument whenever a state or community offer tax incentives to try to lure business. Isn’t it costing the citizens of Utah $150M to put that datacenter there?
No, it’s not. In fact, it’s not costing the citizens anything.
Think about it. That 500 acres plot of ground is sitting empty right now. And, trust me, there’s not a big push from business to want to develop it. In fact, the land is currently generating $66 per year in tax revenue. That’s for the entire 500 acres. It’s a desert.
Now, we let Facebook come in and build a million square foot building and all of a sudden we are getting $500,000-$800,000 in tax revenue. So what if they could have gotten more in taxes without a tax break. If they hadn’t offered the tax break and Facebook decided to go somewhere else, we are not even getting $500K. We are getting $66. Getting lower taxes means we are still getting more than the current tax bill.
And it’s not like Facebook is coming in and taking business away from a local company. If Eagle Mountain offered WalMart a tax incentive to build a store, you could rightly complain that WalMart’s success is coming at the expense of existing local businesses that are not getting the same tax benefits. That’s not the case with a Facebook datacenter.
Utah is a great place for datacenters. Our dry air is ideal for cooling computers without requiring expesive dehumidifier processes. Facebook said this is just Phase 1. They intend to expand the datacenter in the coming decades. That means they are going to build for expansion. Construction is going to pour millions into the local economy. When they finish, there will be dozens of high paying good jobs. The datacenter will take power and water. But, given the payoff, it’s well worth it.
We just got a new Facebook datacenter. Your community should try to get yourselves one too.
Rodney M Bliss is an author, columnist and IT Consultant. His blog updates every weekday. He lives in Pleasant Grove, UT with his lovely wife, thirteen children and grandchildren.
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