Google has declined a jobs-related tax break from the state of South Carolina, and will not claim a $2.5 million grant that required that the company create 200 new jobs in the state, according to local media. The incentives were part of the package Google negotiated with state officials in the site selection process for its data center in Goose Creek, S.C.
The news provides the latest cautionary tale about the use of tax incentives to lure huge data center projects. These projects bring huge investment in the local economy, but don’t always deliver on the level of job creation envisioned by the incentive packages – which in the case of data centers, aren’t enormous to begin with.
Google previously informed the state of North Carolina that it won’t meet the job creation criteria for a $4.7 million state grant for its data center project in Lenoir. The grant required the company to create 200 jobs in four years, but Google has slowed the pace of construction in Lenoir as part of a broader initiative to manage capital expenditures during the economic slowdown.
Google also expected to create 200 jobs in Goose Creek, but apparently has not met that number. “Given the current economy and the difficulty in forecasting our business climate, we do not believe that the (job tax credits) would be a wise investment for either Google or South Carolina at this time,” Google spokeswoman Emily Wood told the State newspaper.
The newspaper reports that Google has completed one data center at its Goose Creek site and built the shell for a second data center, but apparently has not installed any equipment. Wood said the company doesn’t have a time frame for opening the second data center, and that company officials will make that call on the basis of Google’s need for more data-storage capacity.
Photo of Google’s Goose Creek data center from The Digitel via Flickr.