Rural North Carolina Experiences Data Center Boom

1sockchuck writes "Rural counties in western North Carolina have hit the data center trifecta, landing major projects from Google, Apple and Facebook. These marquee tech companies will invest more than $2 billion in small towns like Forest City, Kings Mountain and Maiden, a town of just 3,300 residents. How did western North Carolina become a tech hub? Aggressive tax incentives and an abundant supply of cheap power, a legacy of the textile mills that once thrived in the region, which narrowly missed winning a $499 million Microsoft data center project that ended up in Virginia."

Comments

Isn't it a bit hot there?

[commodore64_love]

I thought Google and the rest were looking for cool zones like Western New York and upper New England. The air conditioning bill in Carolina will be lower than California, but not by much.

I wonder if Western NC and VA residents will still be stuck on dialup, or if they'll finally get an upgrade since they are so close to the data stores?

Hey wow, this is true, I live here.

[Chitlenz]

It's been strange to see this happen. We live right in the center of all this (near Winston-Salem, apple is 45 minutes south, and google is 20 minutes west) and I have to say, these places are not subtle. These places are HUGE. I think the Elkin/Google installation is like 250 acres, which is silly huge. It makes sense, land out here is cheap but you are still 5 hours from DC which in itself is priceless for corporations (the big ones). Add in tax breaks, an evolving biotech industry (like us... we hope!), and lots of geeks near-local (the triangle with IBM/Glaxo/Redhat/Epic Games/Etc. is 2 hours east) and it seems obvious. The nice part for people who live here is that bandwidth is really really good in order to feed all these guys. REALLY good :)

Re:Hey wow, this is true, I live here.

[alen]

it's not like states and localities will collect any taxes if companies don't open up there? might as well give out some nice breaks which are just making up for crazy tax laws in this country for corporations. it's not like tax payers will pay anything. in the end the infrastructure spending will be good for the local areas

Re:Hey wow, this is true, I live here.

[99BottlesOfBeerInMyF]

The article was light on details, but the reason why companies typically do this is because the states hand out idiotically huge tax incentives that there's no way will ever be paid off by the presence of the company.

I've never heard of them actually paying for the federal taxes, just agreeing to not charge all the normal taxes the state does. So how does the state or locality have to pay off anything to break even? Even if they charge no taxes at all, the presence of the company will bring in income tax, sales tax from employees and all the stuff they buy and all the temporary construction workers in the area.

By the time the jobs would be around for long enough to finally start to break even, it's been long enough that the companies have started looking around for who's going to offer the best tax incentives for them to either upgrade their facilities to stay or move.

I still don't see this "break even" you're talking about. Jobs come in for a while. It's doubtful any of these companies are going to move these data centers ever, as they are huge investments. They might not expand them if they get a better deal elsewhere, but even if they did close one, they'd sell it off and another company would open a datacenter there. Nobody just shutters a billion dollar datacenter and lets it sit empty.

it's almost certainly about nothing other than getting ridiculous handouts given by desperate leaders in order to make them look good at any cost to their constituents. See also sports team stadiums.

I've certainly seen some crazy things with stadiums, like subsidies, but then those stadiums often bring a lot of money into a community as well. I guess I'd just have to see some real hard numbers on the situation before I dismiss this as a political stunt that harms their constituency. I read an article or two on most of these and all I saw were tax breaks with a bunch of conditions (healthcare for employees, move into one of several very poor areas, etc.). As far as I an tell, it's the state giving up tax revenue they would not get anyway if these companies chose another location.

Re:Hey wow, this is true, I live here.

[Steauengeglase]

Historically NC has been called, the vale of humility between two mountains of conceit (SC/VA). I'll admit they have their share of rednecks and old boys, but that state is a hell of a lot more progressive than the adjacent areas. It is a shame that they automatically get lumped into cousin-fucker stereotypes, because they have tried really hard while their neighbors wallow in their own shit, jump for handouts and fight tooth and nail to stay in the past. I say this as a South Carolinian.

Re:Hey wow, this is true, I live here.

[Pharmboy]

NC got screwed by Dell because of the infrastructure (roads etc.) they had to put in. Dell returned all other moneys. With these data centers, the infrastructure is not needed. There are already adequate roads (data centers typically employ less than 100 people), there is already tremendous electrical infrastructure (many dams and a nuke plant nearby) and the state wouldn't have to pay for that anyway. All the state is basically doing is not charging property taxes and other fees that they would not normally get to charge on an empty plot of land only. NC has been fairly smart in this, and going after data centers very specifically. They have made plenty of mistakes in the past, as have other areas, but their method of going after data centers has worked out very well and is very cost effective.

Even without the incentives, this is a pretty good area for data centers as it is somewhat centrally located (not geographically, but by population), has mild winters and moderate summers, very cheap wholesale electricity because a glut of power capability (used to be used by furniture and textiles, which are now in China and India), and overall quality of life is good here. It isn't that hard to get people to move here as it is just a couple hours to the Blue Ridge Parkway (and everything that the mountains has to offer), 4 to 5 hours from the beach (we have nice beaches in NC), you can drive to DC in 5-6 hours, NYC in 8-9, Atlanta in less than 5, Nashville in 8, etc. It isn't perfect, but it doesn't suck and there is an incredible amount of things to do within a short drive from anywhere in the state.

Re:Jobs

[sshirley]

I went to university at Western Carolina University and we typically had 30+ students in the CS program. UNC Asheville has about the same. There are also a number of regional community colleges with degrees in IT. There are plenty of educated people in the area who want to stay around home and work there. I am from New England but went to school there. Back then (1999) there was a huge dearth of IT jobs in the area. If something like this had happened then, I'd probably still be there happily.

Re:Otis Would be Proud...

[AnonymousClown]

Moonshine = bio-fuel!

New Jeff Foxworthy jokes are coming...

You know you're a redneck when your porch collapses and kills your dog and the terminal you use to telecommute to the data center you work at.

Re:Power supply

[khallow]

It's unfortunate that such companies will flock to places that offer cheap but dirty power for their facilities. Google, at least, takes a progressive stance towards these things. Hard to maintain a "green" image if your vital infrastructure intensifies the demand for coal-burning. Harder still if you made the conscious choice to participate in this by moving there.

There's a lot of nuclear power in NC too. Coal-burning in the US isn't particularly dirty either.

Re:Jobs

[jamesoutlaw]

Rural life has a lot more to offer than "country music" and "small bars".

Besides, Forest City is a little over an hour from Charlotte-
http://maps.google.com/maps?f=d&source=s_d&saddr=Charlotte,+NC&daddr=Forest+City,+NC&hl=en&geocode=Fc-FGQIdiW4u-ymBGjj8xB9UiDFk0UO_5lBGiA%3BFXsnGwIdcdYe-ymL-Li2eUBXiDEcD-cexdHc0Q&gl=us&mra=ls&sll=35.330812,-81.864624&sspn=3.136834,3.66394&ie=UTF8&z=9

Kings Mountain is a little over 30 minutes frmo Charlotte:
http://maps.google.com/maps?f=d&source=s_d&saddr=kings+mountain,+NC&daddr=Charlotte,+NC&hl=en&geocode=FU7MGQId9tQm-yl3b2jZZN1WiDHoaxOciHBonA%3BFc-FGQIdiW4u-ymBGjj8xB9UiDFk0UO_5lBGiA&gl=us&mra=ls&sll=35.289595,-81.602645&sspn=0.784656,0.915985&ie=UTF8&ll=35.256834,-81.088715&spn=0.784971,0.915985&z=10

and Maiden is about an hour away
http://maps.google.com/maps?f=d&source=s_d&saddr=Maiden,+NC&daddr=Charlotte,+NC&hl=en&geocode=FYnXHgIdnc4o-ymH5GR5yzRRiDFUcW6pZdAArw%3BFc-FGQIdiW4u-ymBGjj8xB9UiDFk0UO_5lBGiA&gl=us&mra=ls&sll=35.256834,-81.090088&sspn=0.784971,0.914612&ie=UTF8&z=11

These places are hardly remote and isolated. There will be plenty of people who will be willing to take the jobs offered in these places (and who will appreciate the low cost of living and the proximity to a larger city).

Re:Jobs

[falldeaf]

That's actually more than I thought but makes sense. Also, just to be clear I didn't mean for my post to be a sleight towards NC, I actually lived in Winston-Salem for a couple years and liked it.

Re:Kinda weird seeing these towns on /.

[oldspewey]

Same basic news stories - except you'll be reading about how a Linux nerd escaped from a nearby data centre, causing a ruckus as local residents stepped out of their homes to gawk at the delicate, pasty white skin.

acres of forested property...

[Junta]

You can buy/build a house on acres of wooded property. Private, low maintenance, no HOA living.

Horrible residential internet though.

I frequent those areas and its some of the most awesome living. Drawing talent away from RTP doesn't seem infeasible.

Re:acres of forested property...

[Notquitecajun]

Resi internet, I imagine, will be a problem that will be solved VERY quickly there with a company enterprising enough to see the need and fill it.

Jobless Recovery??

[DaMattster]

Fine, okay, I am glad that Western North Carolina is going to get these data centers. But, are these companies planning on using local talent or importing talent from other areas? I would be happier if these companies planned on hiring local people and providing training opportunities. The reality of this data center boom is that very few of the local residents will realize any benefit beyond low level employment as cleaners or security guards and there will be very few jobs.

Re:Jobless Recovery??

[Pumpkin Tuna]

This is true. I live about 10 minutes from the Apple data center in Maiden. When it goes online, they expect to only employ about 50 people, and most of them will be imports. Still though, I've been impressed at how little a footprint they have left. The place is insanely huge, but if you didn't know it was there, you might miss it. It doesn't even seem to have any lights shining up in the air at night. They also kept things tidy during construction, even washing down the roads to prevent mud and dust.

Re:Jobless Recovery??

[Nidi62]

Even if they do import people from other areas in the country, the locals will still see an employment boom. Housing construction, road improvements, restaurants, retail centers, need for more teachers, etc. I have family that lives on the other side of the Appalachians in Tennessee, so I've seen this area of NC a lot. In a lot of areas of western NC, especially up in the mountains, there is nothing. And what there is can be few and far between. This will be a boon not only to the towns they are built by, but all the surrounding towns as well. A lot of these support jobs may not pay much, but it's a lot better than some of the options available there now.

As a side note, I've seen inner city Atlanta and some of the worst areas in that town, and I've seen back in the mountains in the southern Appalachians. If you think inner cities are poverty, you haven't seen anything until you go into the mountains.

Re:Jobs

[cayenne8]

"I wonder how hard it'll be to find employees in those areas. I doubt there's a glut of high tech workers looking for jobs in those rural areas and if I were a knowledgeable tech worker I wouldn't really want to move to such a rural area... If you're not into country music and you prefer dance clubs over small bars you would *not* want to move to those areas!"

Maybe not extremely young workers...but perhaps slightly older people, who are wanting to buy a house, and perhaps raise a family?

Places like this can be DIRT cheap to live. Cheap to buy property and build a home, and actually have some land for it to sit on.

Even if you do get a bit less of a bill rate than you would, say on the west coast...with the extremely LOW cost of living, lower taxes, etc, you can really sock some money away. Sure, it will be a bit different lifestyle, but slowing down a bit, getting out of all of the air polution, and actually being able to see some stars at night....well, sometimes, that ain't all bad.

:)

Re:Jobs

[JonySuede]

I am a knowledgeable tech work and I accepted a 50% salary drop to move back to my home town. Living in a big house for about a quarter of the price of my last rent and only having to drive 5 minutes to work is priceless.

Re:Jobs

[Hasai]

I'm with you on that. I could have been in Silicon Valley, but I opted for the Midwest for less than half the pay. End result: Life in a quiet town, twenty-minute commutes, low taxes, plenty of money left over at the end of the month, and a house paid-off in ten years that's three times the square footage of anything I could have possibly been able to afford in the Valley. God bless the "fly-over" states.

Re:Jobs

[NatasRevol]

Hope you don't have kids.

Education was the reason I moved from rural North Carolina. They are the reason for No Child Left Behind. The teachers help push the kids up and over that very low bar just to get their bonuses. I've seen second graders that couldn't read their math problems.

Well, that and all the Nascar rednecks. Everyone's password is nascar7, nascar34 whatever number their favorite driver is.

Re:Jobs

[NatasRevol]

So 41 out of 51 isn't close to the worst?

http://www.alec.org/AM/Template.cfm?Section=Report_Card_on_American_Education

Thanks, but no thanks. I'll move my kids to where most educators are focused on ranking at the top end, rather than how many kids made the NCLB, and how that affects the school.