SPILLOVER BENEFITS TO LOCAL COMMUNITIES

Data centers create positive, long-lasting effects on local communities. Building new data centers creates more demand for expanding and upgrading local roads, power, water, and sewage. Data centers also spend their own resources to train local workers. These assets remain in the community and benefit other local businesses and residents. With these improvements, data centers attract other data centers and businesses to communities. Like other industries, data centers tend to group together geographically and follow others, as seen in Colorado Springs. Raleigh, Des Moines, and other places across the country. Data center often make charitable contributions, partner with local educational institutions, and support local organizations to build stronger communities.

CONTINUOUS ECONOMIC DEVELOPMENT:

The development of large data centers tends to happen in stages, with ongoing investment in construction to increase capacity. As a result, local economies have additional inflow investments and pipeline projects that promote economic growth. For example, in 2016 Google acquired another 74 acres in The Dalles, Oregon, to expand its first corporate data center that was built a decade earlier. The new expansion is estimated to cost approximately $600 million, bringing its total investment in data centers in the area to $1.8 billion. Similarly, the Apple and Facebook data centers in Prineville, Oregon, have brought over $1 billion in new investments, which helped the county’s economy transition from its dependence on the wood products industry. These projects have created thousands of construction jobs that helped Prineville reduce unemployment from 20% during the Great Recession to 8%. The diversification of businesses helps lessen local economies’ dependence on a particular sector.

ADDING A POOL OF TALENTED AND SKILLED WORKERS TO ATTRACT ADDITIONAL BUSINESSES:

The availability of related skilled labor, such as engineers and construction workers, is crucial for high-end and largescale data centers. The pool of skilled workers in the data center industry, such as building architects and engineers, IT engineers and technicians, and computer system designers, creates advantages for local communities to attract other data centers and other industries, as seen in Ohio, Central Washington, and Virginia. Workers trained by Apple and Facebook in Prineville, Oregon; by Google in The Dalles; and by Dell, Intuit, Microsoft, and Yahoo in Central Washington are valuable assets for these regions.

IMPROVING AND UPGRADING INFRASTRUCTURE:

Many data center developments are located in rural areas where public infrastructure is limited. The building of data centers in underdeveloped areas creates a high demand for expansion and the upgrade of public roads, power, water, and sewer systems. In some cases, data centers directly collaborate with local companies to find innovative solutions. These public infrastructure improvements are long-lasting and benefit all local businesses and residents.

Data centers contribute to local communities in different ways, including cash donations, local sponsorships, community grants, STEM education, computer donations, and community assistance. In addition to monetary donations, corporate employees are active volunteers who provide assistance to communities. For example, Google each year works with local organizations to sponsor community events such as Storm the Citadel to promote STEM education, Googlefest to help local teachers, nonprofit leaders, and small business owners use the Internet more effectively, and other seminars to help business owners set up and run successful websites. Google has awarded $1.9 million in grants to South Carolina nonprofits and schools. Similarly, Facebook awarded more than $2 million to schools and qualified nonprofits to support STEM education and technological and economic development in communities in which it operates data centers. Facebook entered into a partnership with Isothermal Community College in North Carolina to develop the curriculum for its Datacenter Institute and launched a pilot program with the Town of Forest City, North Carolina, and Rutherford County Schools to provide free Wi-Fi access to 75–100 students’ homes.

Innovation:

Power is the largest component of data center operating expenditures. Companies are constantly evaluating the source and cost of power for data centers. Over the past decades, data center owners have been actively involved in clean and renewable energy development by working with local utilities and renewable energy companies to develop and purchase power from local wind, solar, and micro-hydro resources. For example, Apple employs an innovative cooling system that reuses water 35 times, resulting in a 20% reduction in overall water consumption in its data center. The data center also uses a rainwater-supplied system for on-site landscape irrigation, further reducing overall water consumption. The Apple campus in Maiden, North Carolina, is supported by renewable energy from two separate 100-acre solar arrays that each produce 42 million kilowatt-hours (kWh) of energy annually. Google has signed many agreements to purchase renewable energy, including the agreement to purchase 407 megawatts of wind-sourced power from MidAmerican Energy Company to supply its data center in Council Bluffs, Iowa. Google sets a goal of powering all its operations with 100% renewable energy. In addition to powering its last seven data centers with renewable energy, Facebook has also begun working with local energy utilities to help create renewable energy tariffs to cover 100% of the anticipated energy consumption for new data centers in Los Lunas, New Mexico, and Papillion, Nebraska. These tariffs are accessible to all companies, and Yahoo recently announced the tariff would enable its Nebraska facility to go 100% renewable as well. Inspired by the model of open source software, the Open Compute Project was launched in 2011 with a mission to share the innovations of IT hardware designs. Since then, the Open Compute Project has become a collaborative community of hundreds of IT and non-IT companies to share specifications and best practices for creating the most energy-efficient and economical data centers.

The Maryland Commission on Innovation and Excellence in Education, frequently referred to as the Kirwan Commission, was created in 2016 and tasked with developing major reforms to improve the quality of Maryland’s public education system. In October of 2019, the Commission voted on and submitted its recommendations. Those recommendations addressed five major policy areas: 1) early childhood education; 2) high-quality and diverse teachers and leaders; 3) college and career readiness; 4) more resources for students that need them, and 5) accountability.

The Commission estimated the additional funding required to implement those recommendations in fiscal year 2030 alone would be $3.8 billion, with approximately $1.1 billion of that total coming from local governments. However, as HB 1300, the primary legislative vehicle for the proposed reforms, has moved through the 2020 Maryland General Assembly, it has been heavily amended. And a March 16 estimate by the Maryland Department of Legislative Services pegged the FY 2030 local funding required by HB 1300 with Senate amendments at $601.1 million. But even that reduced estimate indicates that heavy additional fiscal burdens would be placed on certain localities. For example, the City of Baltimore would be required to provide $152.2 million in additional local funding in FY 2030; Montgomery County would provide 147.9 million; Prince George’s County would provide $141.9 million; and Baltimore County would provide $63.2 million.

Supporting schools

With the motto “good land, good living, good people,” Shelby County, KY is home to data centers owned by Eaton Corporation, EON Energy, and Humana Insurance.

The county attracts data centers due to its proximity to major metro areas, the low cost of utilities, and the mild climate that is not prone to flooding, earthquakes, or storms, according to Shelby County Judge Executive Rob Rothenburger. In the event of a storm, the companies have several backup systems to keep data safe.

In 2011, Eaton Corporation spent $80 million to build a 55,000 square foot data center in Shelby County’s town of Simpsonville, KY. An additional $80 million went toward an identical data center in Louisville, KY.

Shelby County offered Eaton Corporation several incentives, including an industrial revenue bond, to build in the area. The company also receives tax benefits through the Kentucky Enterprise Initiative Act, which allows it to recover state sales and use tax on construction costs, building fixtures, and research and development materials.

While Eaton’s Simpsonville data center has only created about 15 jobs for local residents, these jobs are high paying, Rothenburger said. “They want to attract the brightest individuals from the local community, but they also brought in some internal personnel, especially at the start,” Rothenburger said. As people are trained, and the internal people cycle to other areas, more jobs will open up, he added.

Despite the lack of new jobs, Eaton Corporation does make payments to local schools as part of its local assessment. In some ways, this is more beneficial, because the schools have more funds to improve without the student population growth that would occur if more jobs were offered in the area, Rothenburger said. The company also partnered with the city of Simpsonville to rebuild a community park and baseball field.

“Their contribution to schools has been a tremendous asset to our community,” Rothenburger said. “If we could attract more data centers, we would at this point.”

by Alison DeNisco Rayome in Data Centers on September 19, 2016, 4:00 AM PDT

Typically, the largest source of local revenue for a county is property taxes, while the largest source of local expenditures is education. As a result, because the data centers need more equipment than they need employees, they provide a high benefit-to-cost ratio to localities in terms of the tax revenue they generate relative to the government services that they and their employees require. Data centers pay millions of dollars in state and local taxes, even in states that have sales and use tax exemptions on some data center equipment.

All data centers pay state employer withholding taxes and corporate income taxes. At the local level, they also pay real estate taxes, tangible personal property taxes, business license taxes, and industrial utility taxes.

In addition to the taxes that data centers pay directly, the economic activity that they generate also results in additional tax collections. Employees and business suppliers that are paid directly by the data centers also pay taxes, and, additionally, the people and businesses that are paid by the employees and suppliers of the data centers also pay taxes. All of these sources of tax revenue are included in the tax revenue estimates described in this report.

How data centers can give back to society

by Bobbie van der ListSeptember 21, 2020

The construction of state-of-the-art and energy-friendly data centers has gained momentum around the world, the idea of reusing excess heat has been largely overlooked. But it shouldn’t be. Capturing and recirculating excess heat could make a vital contribution to smart and fossil fuel–free urbanization. It

By using pumps to capture and repurpose heat, SDP aims to supply 10 percent of Stockholm’s total heating demand. Three contracts have been signed in SDP Kista, an area west of Stockholm, with data centers that will provide a total capacity of 20 megawatts of heat. The first of those data centers will start delivering heat in the spring of 2021. This project serves as an example of how the circular economy can work. Companies using the data centers can improve their sustainability records while earning money from a by-product that otherwise would have gone to waste.

Getting warmer

Stockholm, like many other areas in the Nordic region, already has a district heating system, which was built in the 1950s. A district heating system consists of several thousand kilometers of pipes that transport hot water underground and thus provide heat to buildings. The heat can be generated by power plants or other sources. “In the 1980s, we started recovering waste heat from Stockholm’s sewage water,” said Erik Rylander, who heads SDP at Exergi. That stream of waste heat already accounts for about 5 to 10 percent of Stockholm’s heating. Any cost-effective heat recovery system has three basic requirements: (1) a heat source, (2) the infrastructure for transporting heat, and (3) customers interested in buying it (i.e., a market). SDP checks all three boxes. It