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No no no no. I'm not speaking game theoretically here, because there are a good many more factors that go into determining a "win" than the financials. Now fr

No no no no. I'm not speaking game theoretically here, because there are a good many more factors that go into determining a "win" than the financials. Now from a money perspective, they won't get money from Google if Google DOES NOT move in, and they won't get too much money from Google if Google DOES move in. This is because the expenses on the infrastructure improvements to support a 600 million dollar data center for 18 of those 20 years is higher than the $15 million bucks they're gonna get from Google. Those expenses are, obviously, not there if Google does not site a data center in that municipality. So if you want a, sort of, game theoretical optimum, then the question people on both sides of the issue should be answering are: 1 "What are the benefits to this municipality, or to the state, of Google moving in?" and 2 "What is the value of those benefits in tax dollars?" If the answer to 2 is greater than or equal to 15K per Google head, then you break even or profit. If it's not, then you lose.

tptacek 8y ago
I'm sorry, I'm lost. What are the expenses Becker (and the county) will incur if Google sites here? All we've identified so far is a 20MM bond for a waste pipe extension from the site, which doesn't appear to be part of Google's demand. Wisconsin coughed up (IIRC) over a billion dollars in direct infrastructure spending to support Foxconn. Nothing like that appears to be happening here; it looks like here we're just talking about property tax money, which Minnesota was not already expecting to receive, that they'll forgo in order to get Google to site here and not in Ohio. You refer to the expenses in infrastructure Becker will incur if Google sites here. What expenses are those? Becker isn't building the data center or even clearing the land: the land is owned by Excel Energy, which is selling it to Google, and Excel is also providing the power for the data center itself. What is the county spending to make this happen? Help me understand why Becker would turn this down? How do they stand to lose anything if Google plops a data center down here?
- supernovae 8y ago
  Why should taxpayers have to take the risk for Google if the opportunity and reason for Google to be there is already there? If it's already win-win for everyone, why even have the tax abatement? Google being the extremely profitable company it is, shouldn't need to create liabilities for a market it's trying to promise jobs too. a lot changes in 20 years and if its anything like the telco industry it will mean they will rely on these incentives for everything they do in the future because people seem willing to give it to them.
  - tptacek 8y ago
    What risk are taxpayers taking?
    - supernovae 8y ago
      They're taking on growth with an abatement on revenue
- nightski 8y ago
  Is this tax break being extended to all small businesses with 50 or so employees in the city? If not, why? Why is Google special when it needs it the least? Tax incentives create an unfair business environment and hurt local business. In reality, taxes on everyone else will likely rise
  - tptacek 8y ago
    Google's argument, according to a link posted upthread, is that its investment of hundreds of millions of dollars in the construction of a data center will drastically improve the value of the lot that it's building on, and it wants a 20 year abatement on the increased value it is itself generating on the land. It's not at all clear to me how or why taxes on everyone else will likely rise.
    - nightski 8y ago
      That's what happens every time they give big business an exception in my city. Fedex was the most recent. A city commissioner literally asked the Fedex rep at a commission meeting if they would still come without the tax incentive and they replied yes. The commission then still proceeded to pass the incentive. They see 20 years of tax free growth while property taxes go up for everyone else. Google has to spend the money on the data center regardless if it gets the tax incentive or not. Whether the city gives them $15M in a free ride until then is what is in question. It's basically spitting in the face of your new neighbors. The $15M is not important to the success of this data center and it will be a drain on the town for the first two decades.
      - tptacek 8y ago
        How exactly is this a drain on the town? People keep saying things like this and it is not at all clear how that could be happening. The opposite seems likely: Google building a huge data center here will, in fact, be an economic boon (marginal or significant, we can debate). This isn't money the county is paying Google, or that Google is somehow taking from the town. It's a data center built on an empty field in the middle of nowhere, connected directly to a wind farm run by an otherwise struggling power company that owns the land Google is using.

tptacek 8y ago

I'm sorry, I'm lost. What are the expenses Becker (and the county) will incur if Google sites here? All we've identified so far is a 20MM bond for a waste pipe extension from the site, which doesn't appear to be part of Google's demand. Wisconsin coughed up (IIRC) over a billion dollars in direct infrastructure spending to support Foxconn. Nothing like that appears to be happening here; it looks like here we're just talking about property tax money, which Minnesota was not already expecting to receive, that they'll forgo in order to get Google to site here and not in Ohio. You refer to the expenses in infrastructure Becker will incur if Google sites here. What expenses are those? Becker isn't building the data center or even clearing the land: the land is owned by Excel Energy, which is selling it to Google, and Excel is also providing the power for the data center itself. What is the county spending to make this happen? Help me understand why Becker would turn this down? How do they stand to lose anything if Google plops a data center down here?

supernovae 8y ago
Why should taxpayers have to take the risk for Google if the opportunity and reason for Google to be there is already there? If it's already win-win for everyone, why even have the tax abatement? Google being the extremely profitable company it is, shouldn't need to create liabilities for a market it's trying to promise jobs too. a lot changes in 20 years and if its anything like the telco industry it will mean they will rely on these incentives for everything they do in the future because people seem willing to give it to them.
- tptacek 8y ago
  What risk are taxpayers taking?
  - supernovae 8y ago
    They're taking on growth with an abatement on revenue
nightski 8y ago
Is this tax break being extended to all small businesses with 50 or so employees in the city? If not, why? Why is Google special when it needs it the least? Tax incentives create an unfair business environment and hurt local business. In reality, taxes on everyone else will likely rise
- tptacek 8y ago
  Google's argument, according to a link posted upthread, is that its investment of hundreds of millions of dollars in the construction of a data center will drastically improve the value of the lot that it's building on, and it wants a 20 year abatement on the increased value it is itself generating on the land. It's not at all clear to me how or why taxes on everyone else will likely rise.
  - nightski 8y ago
    That's what happens every time they give big business an exception in my city. Fedex was the most recent. A city commissioner literally asked the Fedex rep at a commission meeting if they would still come without the tax incentive and they replied yes. The commission then still proceeded to pass the incentive. They see 20 years of tax free growth while property taxes go up for everyone else. Google has to spend the money on the data center regardless if it gets the tax incentive or not. Whether the city gives them $15M in a free ride until then is what is in question. It's basically spitting in the face of your new neighbors. The $15M is not important to the success of this data center and it will be a drain on the town for the first two decades.
    - tptacek 8y ago
      How exactly is this a drain on the town? People keep saying things like this and it is not at all clear how that could be happening. The opposite seems likely: Google building a huge data center here will, in fact, be an economic boon (marginal or significant, we can debate). This isn't money the county is paying Google, or that Google is somehow taking from the town. It's a data center built on an empty field in the middle of nowhere, connected directly to a wind farm run by an otherwise struggling power company that owns the land Google is using.