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June 19, 2007 | Comments: (0)
Iowa tailors taxes to entice Google
Hawkeye State offers tax breaks in hopes of reaping long-term benefits from 2,000-acre server farm
Lured by special incentives, Google has announced plans to open a new $600 million data center in Council Bluffs, Iowa, according to reports. Whether it will be as green as the partially solar-powered Googleplex remains to be seen.
Google will use an existing building on a 55-acre plot of lands in the Council Bluffs; the server farmer could swell to cover 2,000 acres.
Iowa dangled some legislative carrots as incentive for the search behemoth to open shop in Iowa. According to reports, Iowa legislators have decided not to charge sales taxes on the utility bills for server farms, which will spell savings for Google, given the ever-increasing costs of running not only server hardware by the HVAC to keep the cool. Iowa is also waiving taxes on all computers Google will purchase.
Further, Google will reap a property tax break through 2024, according to reports, but it will plunk down about $65 million in property taxes over the next 15 years. Further, Google is expected to pay around $6 million in sales tax for building materials, state officials estimate.
Google will bring about 200 jobs to Iowa with an average salary of $50,000 to $60,000, according to different reports.
The Iowa data center will be situated newly expanded MidAmerican Energy electric-generating station. The expansion has increased the electric station's reliability and capacity to 790 megawatts, another reason Google picked the Corn State as the new home for its server farm.
Posted by Ted Samson on June 19, 2007 12:52 PM
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Iowa is the "Hawkeye State," not the Buckeye State. That's Ohio.
Also, Iowa becoming increasingly known for renewable energy (ethanol, E-85, biodiesel, wind energy, etc.), IT, insurance and manufacturing, not just agriculture.
Just wanted to clear some things up.
Posted by: Shawn at June 19, 2007 01:35 PMThanks, Shawn. Apologies to the denizens of both Ohio and Iowa for the state confusion. :)
It'll be interesting to see how this trend continues and what incentives -- tax breaks, looser environmental regulations, etc. -- that other states and countries might offer tech-heavy companies to set up server farms.
Posted by: Ted Samson at June 19, 2007 02:10 PMSecond quibble: Iowa is traditionally the 'Tall Corn State', not the 'Corn State'. Perhaps it will now be known for server farms with millions of Linux kernels as well as old fashioned farms with millions of kernels of hybrid corn.
Posted by: Robert Folkerts at June 19, 2007 02:44 PMHaha. Good one! But I think you're getting a bit too pedantic on the nickname now. :) The Corn State is a perfectly accepted nickname for Iowa.
Posted by: Ted Samson at June 19, 2007 03:28 PMI've never heard the nickname "Corn State" before, but I have heard "Tall Corn State" often. "Corn State" sounds derogatory, as though corn is the only thing in Iowa worth mentioning. "Tall Corn State" says that the corn in Iowa is exceptionally tall.
I'll try not to take it personally if you try not to offend. :-) It's good to see Iowa get some good press out of the deal with Google. Thanks for the article.
Posted by: Scott Miller at November 21, 2007 01:20 PM
