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Cupertino Approves New Apple Spaceship HQ

Posted by Unknown on from the you'll-never-want-to-leave dept.

mrspoonsi writes with news that Apple's plan to raze the old HP headquarters and replace it with some kind of space ship is moving forward. From the article: "A little over two years since Steve Jobs presented his case for it and after the occasional setback, the Cupertino City Council has finally given Apple full approval to go ahead with its futuristic campus. In exchange, Apple has agreed to fork over more money to the city in the form of a reduced sales tax rebate — going forward, Cupertino will only give back 35 percent sales tax instead of the 50 percent it had previously. Indeed, as soon as Apple gets its final permits some time today, it can begin demolishing the former HP headquarters and start building its own."

14 of 172 comments (clear)

  1. Wow. by LWATCDR · · Score: 5, Insightful

    "Under the new agreement, that rebate has been reduced to 35 percent, which based on 2012 tax revenues would mean the residents of Cupertino will pay Apple -- which recorded net sales of $156.5 billion during the last fiscal year, and has a cash hoard estimated at $100 billion -- only $4.4 million to stick around. It would have been $6.2 million under the old agreement. That's an extra $1.8 million for Cupertino, a city with only $51.4 million in projected general fund revenues this year, according to figures reported in the Los Angeles Times."

    Really Apple Cupertino gave you a tax break when things where not going well for you. Now you are doing well you are still getting a 4.4 million dollar kickback! Come one and just pay your taxes. You would increase the general fund by around 8%.
    AKA just do the right thing.

    --
    See my blog http://ilovecookes.blogspot.com/ for light hearted technical information.
    1. Re:Wow. by gl4ss · · Score: 3, Insightful

      this is truly perplexing.

      what's the rationale behind giving them benefits? would they move away if they didn't? unlikely, really.

      --
      world was created 5 seconds before this post as it is.
    2. Re:Wow. by davydagger · · Score: 3, Insightful

      I think its called "tribute". Its an acknowledgement that apple, not the municipal government is the most powerful entity in city, and they call the shots.

      Thats how corporate America works.

    3. Re:Wow. by InsightfulPlusTwo · · Score: 5, Insightful

      A few observations:

      The city is not paying Apple anything; it is actually increasing their tax burden from the formerly reduced state. Thus the article, which says "the residents of Cupertino will pay [Apple] only $4.4 million to stick around" is misleading and deliberately inflammatory.

      The agreement was approved unanimously by the board. They think they are getting a good deal by having the world's largest corporation build a giant, permanent, iconic headquarters there and I agree. Any city in America would be happy to have them. Just think of all the tourists who are going to show up from around the world just to see this new building.

      The city gets a lot of benefits from Apple employees living and working there aside from direct taxation, in terms of personal living expenses and a well-educated populace, as mentioned elsewhere in the article.

      They can always renegotiate the tax breaks later if they really need the money.

      --
      I felt bad for the man who had no signature, until I met a man who had no comment.
    4. Re:Wow. by Quila · · Score: 3, Insightful

      Let's see, the city gets thousands of Apple employees moved in. Construction alone is expected to net the city almost $40 million. And then there are recurring property taxes for a property that will now be worth billions. The city also gets a shabby built-up area converted to something that is 80% landscaped and environmentally friendly.

    5. Re:Wow. by N1AK · · Score: 3, Interesting

      The issue with this argument is that it sounds all well and good until you consider it for a few seconds. Apple gets a rebate now that it is a billion dollar company but if a new 'Apple' was starting out today they'd have to pay the full rate of tax. Big companies are pitting cities up against each other in the prisoner dilemma to keep a tax rebate which means that taxes on everything else have to be higher to make up for the discount.

      Apple makes a huge profit margin and pays very little tax. There's no reason at all why society benefits from giving them a rebate they really don't need; in fact it hurts society by increasing tax on others. The only reason they can have a rebate is that they've got big enough they can threaten municipalities with oblivion if they leave which is a pretty shitty situation imo.

    6. Re:Wow. by tlhIngan · · Score: 4, Insightful

      what's the rationale behind giving them benefits? would they move away if they didn't? unlikely, really.

      Apple is Cupertino's largest taxpayer by far.

      In fact, Apple SPECIFICALLY CHOSE the site for their new building - Cupertino had no land available otherwise (it was land from an old Sun/HP campus, IIRC). So Apple had a choice - it could build its new building in Cupertino, or it could put it somewhere else. Cupertino gives Apple a small tax break (they don't give Apple any money - Apple pays more than that amount in taxes to Cupertino annually) as a thank you for being loyal to Cupertino. And it's likely the board sees that the added revenue from employees being there (from construction and all that to the sheer number of extra employees) to more than make up for the loss (after all, those people need to eat, like to frequent bars, etc. and Apple is likely needing to purchase local service to maintain the building and grounds and all that).

      In fact, any large corporation wanting to put down roots can easily negotiate with the host city on benefits. I would expect Redmond to give Microsoft breaks in exchange for being in Redmond (though Microsoft's campus straddles the border, so there's a building that's actually odd because it has to be built to two different building codes as it straddles Redmond and a neighbouring city).

      Likewise, Mountain View probably gives Google a few breaks as well.

      And these cities are all known because of these big companies - anytime anyone mentions Redmond, well, up comes Microsoft. Cupertino has Apple, and Mountain View has Google.

      Apple may not pull up its roots from Cupertino, but they can certainly decide to build in a neighboring city if they have to. The fact they're choosing Cupertino is really a preference for them - being nostalgic and all that. Hell, given all the difficulties Apple encountered, one may wonder if it was worth all that effort to build in Cupertino and not just build it nearby somewhere else.

  2. Steve Jobs talking about the campus by jones_supa · · Score: 4, Informative

    Here's a presentation by Steve Jobs from a couple years ago showing the initial plans for the spaceship campus. According to the video title it's apparently the last recorded Jobs video footage. Good luck to Apple finishing the building during the following years, it's certainly a cool plan.

  3. Apple has JUMPED THE SHARK by CajunArson · · Score: 3, Insightful

    Sign that a company is jumping or is about to jump the shark: Build a huge lavish HQ.

    Although, Google didn't mind when SGI did it.. they got a great deal on the real estate.

    --
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    1. Re:Apple has JUMPED THE SHARK by nojayuk · · Score: 4, Interesting

      I think the ticket price for the building is about $5 billion, it may rise as the project goes ahead -- there's lots of custom curved glass panels and such involved. With 14,000 workers expected to use the building that works out at about 350,000 dollars each. Office space in Cupertino leases at about $35/sq. ft./year so for the proposed upfront cost they could lease 500 square feet for each employee for twenty years and not have to pay for the structural maintenance, landscaping etc.

      It's a pretty way to use up money, I suppose.

  4. nothing new by Anonymous Coward · · Score: 5, Funny

    It is the pentagon, but thinner and with rounded corners.

  5. No they would not move away! by Dareth · · Score: 5, Funny

    They are building a space ship so they can "fly away" if the city doesn't cooperate. Read the bloody article!

    --

    I only look human.
    My mother is a halfling and my dad is an ogre, so that makes me an Ogreling
    1. Re:No they would not move away! by ShanghaiBill · · Score: 5, Insightful

      They are building a space ship so they can "fly away" if the city doesn't cooperate.

      They don't need to fly. They can walk. The next city (Sunnyvale) is about 200 meters from their current headquarters. Both Santa Clara and San Jose are within three miles.

      Apple is in a strong negotiating position. Personally, I think courts should strike down these special tax deals as a violation of the equal protection clause. For the cities, it is a prisoner's dilemma anyway, and they would better off if the practice was made illegal.

  6. WARN: There is another system by RDW · · Score: 3, Funny

    Here in the UK we cut out the middleman, and just buy these flying saucer tech headquarters directly from taxpayers' money:

    http://en.wikipedia.org/wiki/Government_Communications_Headquarters

    Then they spy on us.