Report: Officials in Oregon Approve Google Data Center Tax Breaks

If build goes through, taxes on data center electricity purchases will provide 10 percent of local general fund

Jason Verge

August 6, 2015

2 Min Read
Report: Officials in Oregon Approve Google Data Center Tax Breaks
People stand in the lobby of Google’s Washington, DC, headquarters in January 2015. (Photo by Mark Wilson/Getty Images)

Local officials have approved for a new package of tax breaks for a new data center Google is considering building in The Dalles, Oregon, reported The Oregonian.

The company acquired a large parcel of land and is mulling a third data center build about a mile down the road from its existing campus. Google will be exempt from property taxes on its massive fleet of servers, and the approved package could save the company millions over the deal’s lifespan.

Google values its current investment in The Dalles at $1.2 billion. Oregon was home to Google’s first self-designed and built data center in 2006 and a second $600 million Google data center there came online earlier this year.

Franchise fees generated by Google’s electricity use account for around 6 percent of The Dalles’ general fund, according to the Oregonian. The new data center could increase that share to 10 percent.

Google will be required to pay $1.7 million upfront and $1 million annually to local governments if the project goes forward. For the second data center, Google paid $1.2 million to the city, Wasco County, and the local school district in a 2013 tax deal and agreed to pay $800,000 annually starting 2016.

Google will also pay $250,000 to the port for brownfield redevelopment. The new tax deal also requires Google to pay its employees in The Dalles at least 150 percent of the local average.

The data center tax breaks were approved 3-0 by county commissioners following a 2-1 vote on the day prior. The dissenter wanted assurance that Google won’t seek an extension after the 15-year term ends. That sort of thing has happened before.

Google is constantly expanding its data center footprint. The most recent Google data center expansion projects include construction on the site of a shuttered coal power plant in Alabama, a $300-million build in the Atlanta metro, a $380-million data center in Singapore, and a $66-million project in Taiwan.

Google’s data center would be one of many coming to Oregon, which is enjoying a data center boom thanks to tax breaks, low-cost hydro power, and and also, in all likelihood, because of Portland's amazing variety of food trucks.

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