Data Center Is Getting a $77M Tax Break to Create One Job
nysfocus.comPurposefully misleading or just misinformed?
There is one permanent job being created, but that's not what the tax break is for.
Cities offer tax breaks because there are other advantages. Vendor services, long term tax base (largely through property tax), infrastructure improvements (grid capacity, fiber, etc)and temporary construction work. You might say the temporary construction work is worth very little, but then you have to recognize much of the tax breaks are bound to the temporary construction phase as well.
We can weigh the pros and cons but this article is not doing that.
Exactly. The municipalities offer these tax breaks (the article cites the tax breaks are for sales taxes) so that they can continually draw property tax from the site. In the long run, it should provide more tax funds for the community. Not to say there aren't downsides to building datacenters, but it's misleading to pretend it's for 'job creation'.
That's exactly what happened in Ashburn. Loudoun County VA is currently meeting pretty much its entire operating budget with data center tax revenue, and property tax rates have been going down for years. More importantly, Loudoun went from being the fastest growing county in the US, borrowing money and building roads, schools, fire stations, etc. at a fierce clip, to a much more maintainable population growth curve (= more compatible with residential sprawl).
They’re also getting a property tax abatement until 2044, so nope!
This is 100% a screwing of the taxpayers, and that’s before you consider all the more productive ways that money could be spent.
Do you have a separate source for that? The article does not give any detail on potential property tax abatements. Also, this statement at the end seems to contradict your statement: "Porath, for his part, says Rockland County is just following the rules as they’ve been set out. And he maintains that deals like the one the IDA has given to JPMorganChase are paying dividends for the county, turning an asbestos-filled site that wasn’t paying any taxes into one that is pumping hundreds of thousands of dollars per year into local schools and other services."
"infrastructure improvements (grid capacity, fiber, etc)"
Do these projects fund these? Because the crux of the best argument against data centers is hinged on a lack of infrastructure (power, water etc.) availability.
Yes, they do fund them. They depend on local infrastructure providing them.
This is a straight up lie of a headline.
The tax exemption was for SALES TAX on MATERIALS AND EQUIPMENT for CONSTRUCTION, because those local purchases helped the local construction industry.
You can read the actual authorizing resolution for yourself here:
https://rocklandida.com/wp-content/uploads/2024/02/Authorizi...
The idea that permanent jobs were some kind of a trade, or even factored into the decision at all, is completely fabricated.
It’s “exemptions from state and local sales tax on materials, services and equipment used in the construction, renovation and equipping of the Project” and that includes a whole lot more than local construction industry stuff. Most of the cost of a data center comes from servers and other hardware, in particular. Also, there’s other tax breaks (like the property tax abatement) that come from working within IDA.
I do agree that local jobs have nothing to do with this decision, because it’s clearly a stupid one if that’s the case.
>The story goes that Milton Friedman was once taken to see a massive government project somewhere in Asia. Thousands of workers using shovels were building a canal. Friedman was puzzled. Why weren't there any excavators or any mechanized earth-moving equipment? A government official explained that using shovels created more jobs. Friedman's response: "Then why not use spoons instead of shovels?"
A good faith dollar-focused rebuttal would probably involve one or both of directly addressing the claims of the cost-benefit analysis or discussion of costs to the tax base not considered in the C-B A.
It really is a sick joke to pretend that datacenters “bring jobs” to local communities. Data centers require specialized experience so 99% of the workforce will be brought in from out of state, or from an urban area within the state.
When you’re saying this in poverty-stricken areas like West Virginia, it’s really no different from this stomach-turning scene from Succession: https://www.youtube.com/watch?v=biN5cvMjRtI
Absolutely vile.
I didnt watch the video, but does it have anything to do wth not reading articles before mouthing off? Because you certainly didnt
Wow a 9 day old account with 10 karma. You’re definitely not a bot.