Facebook Gets $150M in Tax Breaks to Build Utah Data Center

Daily Tax Report: State provides authoritative coverage of state and local tax developments across the 50 U.S. states and the District of Columbia, tracking legislative and regulatory updates,...

By Tripp Baltz

Facebook will build a 970,000-square foot data center in Eagle Mountain City, Utah, and receive $150 million in property tax incentives.

Utah Gov. Gary R. Herbert (R) said the social media giant will construct a “state-of-the-art” data center along with more than $100 million in “pioneering infrastructure,” including a new electrical substation that will bring 1,000 megawatts of new power delivery capacity to the region to support additional economic development. The center is expected to open in 2020 and employ 30 to 50 people full-time, with potential for more contract workers.

The May 30 announcement by Facebook, Herbert’s Office of Economic Development, the Economic Development Corp. of Utah, and Eagle Mountain City comes a week after Utah County approved $150 million in property tax incentives for an at-the-time unnamed company to build on a 500-acre site in the city.

Renewable Energy

Rachel Peterson, vice president of data center strategy at Facebook, said access to renewable energy, a strong talent pool, and a “great set of partners” were the chief reasons the company chose to build the new center in Eagle Mountain. The center will be powered by 100 percent net-new renewable energy through the use of available renewable energy tariffs from Rocky Mountain Power, the state’s largest utility.

Facebook will buy its own water rights and construct needed water infrastructure for the center, the announcement said.

Eagle Mountain City said the modest increase in employment headcount was appealing as it won’t significantly strain existing local resources such as schools, fire and policy services, or traffic in the rapidly growing area south of Salt Lake City.

To contact the reporter on this story: Tripp Baltz in Denver at abaltz@bloomberglaw.com

To contact the editor responsible for this story: Ryan C. Tuck at rtuck@bloombergtax.com

Copyright © 2018 Tax Management Inc. All Rights Reserved.

Request Daily Tax Report: State