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Oregon Residents Riled Over Virtually Staff-free Data Centers Getting Tax-breaks
An anonymous reader writes: The population of Hillsboro, Oregon is becoming vocal about the state's enterprise zone program offering enormous tax concessions to companies setting up data centers in the region — even though the five-year deals on offer only require data center operators to employ one person. That's exactly as many people as one DC plant, Infomart Portland, employs full-time, yet it gets more tax relief than highly-staffed enterprise zone neighbor Solarworld. The current influx of data centers to Hillsboro have only generated seven jobs to date. More installations are coming, and all Hillsboro residents are seeing is space taken up that might have gone to businesses that give something of benefit to the community.
Finally people are waking up to the fact that the digital revolution doesn't necessarily create jobs, jobs, jobs.
"Transparent" is a shit show that trades on every stereotype going. A man in drag is NOT a transsexual.
and i can counter with just about that many MORE indirect jobs that the place employing say 25 people would generate (added to your list).
Food delivery folks
Supplies delivery folks
Clothing shops
car dealers
Entertainment venues
Schools (wanna see if you can make a team of folks that DON"T have kids without doing something actionable??)
Food shops
I get entire racks prebuilt shipped in and out, it just takes one on-site person to plug it in then the shippers get back in their truck and go back whence they came.
That said, if the company cited really does only have one employee, I'm glad not to do business with them. I'd require a bare minimum of three to at least pretend someone is on site 24x7.
I live in Hillsboro and have no complaints, though I have hardware in one of those datacenters so I may be biased. I think these articles are failing to account for the jobs created indirectly. I know a few folks that work for companies that have hardware in one of these local datacenters, in addition to traditional sysadmin jobs their duties include being on-call for hardware failures and the like. A at least one of these companies is fairly large and chose to come to Hillsboro and hire techs here because of the space available.
It was a big story on the front page of The Oregonian this morning. That's the first time I heard about it. If those guys are worried about having enough space they ought to put their data centers in Prineville. Tons of room out there.
I've actually lost count how many megachurches have been built on farm land in Upper Marlboro, MD. I assume the land must be cheap, as we have The First Baptist Church of Glenarden, which was built just 1.2 miles from Riverdale Baptist Church. And it's not to be confused with the First Baptist Church Upper Marlboro, which is about 8 miles away as the crow flies.
All of these are non-profits, so there will likely never be any more tax revenue from them, and unless they also have a school (which Riverdale does), it sits nearly empty for most of the week.
Build it, and they will come^Hplain.
If they want to put a rack in my flat in Beaverton this winter I would love the free heat
411 Y0UR 8453 4R3 8310NG 70 U5!! -NSA
Indirect benefit of living near industry like this better infrastructure. My power is more reliable and I get better water than the folks down the road and I suspect living across from the big business park in Beaverton isn't completely unrelated
411 Y0UR 8453 4R3 8310NG 70 U5!! -NSA
How many of those jobs are in the vicinity of the data center? Localities don't give tax breaks to help the global economy. They do it to help their local economy.
The question isn't whether ANY economic benefit is brought to the community, but whether that benefit exceeds the ~750k per year of tax reduction given to the company mentioned in the article. Some people seem to think so, some not. Hard to tell who is right, but it deserves to be highlighted that communities simply paying corporations to establish isn't automatically a great deal.
The rest are probably contractors, which wouldn't be employees. So, the whole metric of the number of full-time [on-site?] employees is quite biased to underestimate the number of people involved in the operation.
Most of the data centers I deal with are unmanned. It doesn't matter when you go, unless you call ahead, there is nobody there to meet you. There isn't any staff that hangs around. The security is all automated. The many cameras are monitored by an off-site force.
Learn to love Alaska
... these local governments are still of the mindset that "industrial/technology" means factories, which means jobs. But as we all know, everybody that builds a datacenter wants as little staff as possible. A datacenter full of staff is seldom a good thing. When I walk past our datacenter on my way to work, if I even see the lights on or more than one car in the parking lot, I clench up, because I know it isn't going to be a good day when I get to my office on the other side of the campus.
In general, another factor in the equation is what tax revenue would have been generated on the land consumed by the DC if the DC hadn't been built. In an area where land is plentiful, the land might be (under)utilized for the next five years by something that would generate less net tax revenue.
Why is there an "insightful" mod and why isn't it "-1"? If I wanted insight, I wouldn't be reading
I think this fails to take into account the indirect job creation that this operation permits. For instance, the building maintenance and construction had to be done by locals. Any time the A/C breaks down, it has to be repaired by locals. If a server fries, there has to be someone to build that machine and swap it out. There is a lot of consumption of infrastructure resources, like power and water, that also feeds into the economy. There are a lot of DC jobs that you can't see. Granted, they aren't the same number of people as a factory might employ, but there are a lot of unseen positions that these data centres create.
Not really. Most of the materials are imported and configuring them is very quick. Your "lots of jobs" = not local.
Sounds like you're happy to live in a 3rd world country called the USA?
People used to take those for granted. Well, a long time ago, when there was still a middle class.
I was wondering abput this myself. Keep in mind, the tax value of the property might not have been as high before the data center was built either.
But Oregon and the counties in it also tax business income in the state. The state is like 6.7% on the first $10 mil and some higher number after that. So lets guess that the property tax was half as much and the data center pays $5000k in income taxes a year. Is it worth it considering a likely or possible alternative of less than $400k a year without it?
And keep in mind, i have no clue on the previous tax revenue. I'm just asking if the extra in other taxes with the business makes it worth it or not.
and i can counter with just about that many MORE indirect jobs that the place employing say 25 people would generate (added to your list).
Food delivery folks
Supplies delivery folks
Clothing shops
car dealers
Entertainment venues
Schools (wanna see if you can make a team of folks that DON"T have kids without doing something actionable??)
Food shops
Versus how many people would be doing the above jobs if instead of a 25-person data facility, an old-time 1500-person factory was located there?
It's like the old trickle-down fallacy. If a CEO earns 400 times what the other employees do and lays them off, is he going to buy 400 times as much toilet paper?
False equivalence - the question here is whether the data centers bring in enough tax revenue through direct or indirect means to offset their tax breaks. If not, then they are effectively picking Oregon residents' pockets by state proxy.
Looks like summer around here.
Never let a lack of data get in the way of a good rant.
Food delivery/shops -> with only 25 jobs and thousands of unemployed I can pay those 25 people subsistence wage. They won't be buying food from restaurants. They can barely feed themselves. Same goes for clothing and entertainment. As for cars, hah! They can walk. Meanwhile we're cutting funding to schools. And besides, once they have kids they're dead weight. I'll just fire 'em and hire more young single people from the local tent city.
See, once you start racing to the bottom there's no end in sight. And all the trickle down (voodoo) economics in the world won't save you.
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I get entire racks prebuilt shipped in and out, it just takes one on-site person to plug it in then the shippers get back in their truck and go back whence they came.
That said, if the company cited really does only have one employee, I'm glad not to do business with them. I'd require a bare minimum of three to at least pretend someone is on site 24x7.
If you have a lights-out datacenter, you don't need employees on-site 24x7 because replacing hardware is not a time-critical task, if a disk drive, server or switch fails, you can replace it during your next monthly maintenance sweep. If a power system failure takes out half the datacenter, you failover to your backup datacenter while you wait for a repair crew to arrive at the failed datacenter. Whether you have an employee on-site or not, he's not likely to be able to fix anything himself anyway.
You don't need people on-site to monitor the datacenter, you can have everything monitored by your NOC on the other side of the country.
are located in Hillsboro Or. Also located there is a major part of their design group and process science.
The tax breaks were given to Intel, But in an an attempt by the county and city gov. to not look biased, I presume they extended the breaks to all tech. Of course, The companies are eating the infrastructure for lunch.
It was a big story on the front page of The Oregonian this morning. That's the first time I heard about it. If those guys are worried about having enough space they ought to put their data centers in Prineville. Tons of room out there.
Hah. Yeah well Prineville doesn't seem to be complaining too much about the Facebook center there, since the only other thing around is Les Schwab HQ. It's true however it's not supplying any jobs to a pretty depressed economy in that county. I think they're planning to expand, or are already. I've forgotten. DC's like it here though; low humidity allowed for an interesting cooling setup there, and the electricity is relatively cheap.
But really our general world-connectivity in central Oregon has improved much since a DC here required more fiber. It used to be that a backhoe or other would cut our only link to Portland, and more than once all ATMs in three counties would stop working.
It's a real bank:
http://en.wikipedia.org/wiki/F...
Build it, and they will come^Hplain.
There's an Apple DC there too, isn't there?
They moved the Les Schwab HQ to Bend in 2008 after Les died in 2007 but they still have the big distribution center in Prineville at the bottom of the rimrocks.
How does a data center drive up land and home prices if there are only a few employees?
Instead we must think of population control. this planet can't susta more than 2.7-3 billion Homo sapiens any way.
Sure it can.
It *does*, therefore it can. Proof by example.
There's also the reality that those tax incentives could be spent on things like education that would bring more jobs to the area on a per dollar basis. That's the real issue with subsidizing datacenters that employ basically nobody locally.
So you can give the tax breaks, and have the data center built locally, and employ construction workers, ongoing site maintenance workers, etc., which you don't count as employees because they are contractors, yet they have jobs.
Or you can *not* give the tax break, and have a vacant lot, as the data center is built in Kansas or wherever instead.
Pick one.
Not really. Most of the materials are imported and configuring them is very quick. Your "lots of jobs" = not local.
If only there were some way to make Oregon economically desirable to businesses...
Reminds me of the data center shit that happened up in Quincy Washington, Sure, they created a few jobs, but it also made the land and homes so expensive that the locals couldn't afford to buy and live there any longer...
Because everyone wants to live next door to a data center because of all the jobs there, or why? Why would it be more expensive to live near a data center, than not, if there were no economic benefit to doing so?
Because the supply of land (which is also required for homes) is finite; any project that removes a large chunk of it from the market is going to drive up the price of the remaining available space (and by extension, homes that might be built on it).
No relation to Happy Monkey
Why no mention of part time jobs?
I really wish these tax deals didn't exist. I'm on the opposite end of this problem, living in New York. Taxes are high, cost of living is high, but in my opinion quality of life is high too. Florida, North Carolina and Texas constantly go trolling for companies in high-tax states (NY, CT, MA, CA, etc.) and bribe them to move. Some of these bribes are crazy, as in, "We'll build you a headquarters, give you free utilities for 10 years, and you'll pay zero property taxes." The problem is states end up playing Prisoners' Dilemma with each other. New York does the same kind of incentives, but can't support the level of offers that no-tax states can...I think some regions of upstate NY are waiving local taxes for a certain number of years, but businesses want permanent gains. The worst thing is that the anti-tax folks whip the media up into a frenzy whenever one of these companies moves, trying to get more people onto the anti-tax side using this as an example.
The problem is that in Florida and Texas, states with no income tax, you get what you pay for in terms of services. In NY, outside of NYC, even the crappiest school districts are adequately funded and provide OK education. The state university system is good and still a bargain if you get into one of the better schools. Public services are decent in most places. In a state where you pay no income tax and $1000 a year in property taxes, you're not going to get the same level of services. I worked for one of those relocated companies, and went on a fact finding trip when they wanted to move me to Orlando. A real estate agent (who was actively trying to sell me on the idea) actually mentioned that if our kids are used to NY public schools, I would have to put them in private school to get them the equivalent. There goes all that cost savings from the cheap house and low taxes! Plus the weather sucks -- yeah, yeah, I'm weird, I like winter.
In this case, Oregon just hasn't figured out that data centers are not an employment source. Most run lights-out and employ one or two techs to swap out equipment and maintenance/security forces. Any images of 20-something developers in hip office spaces cranking out the latest phone apps are not applicable here -- they're still sitting somewhere else.
Their first hint should have been from the last time this happened in the 1980s and 1990s, and Hillsboro got built up from being a farm town in the middle of the last arable land west of Portland to one of the 5 largest cities in the state, now making it pretty much nonstop city from Forest Grove to Wood Village. Yet the gridlock is horrible because all the tax breaks that were given to build up the tech meant that there's nothing in terms of basic infrastructure to support it. Intel's campuses sit on two lane farm roads, with the exception of Hawthorne Farm (which has it's own MAX station), despite being, literally, in the middle of a city with more than 100,000 people and no mass transit to speak of (TriMet largely doesn't serve Washington County except for the MAX, and frequent service ends miles east of the economic incentive zone in Beaverton). God help you if your house catches fire or you have a heart attack at rush hour, nothing's getting through that traffic. But that's only the tip of the socioeconomic iceburg.
I was born and raised in Portland on Jessup and Garfield, just off of 99E, in the only part of town that has any racial diversity. I'm Cherokee, I'm bisexual, and I can't say I miss the low IT wages, unavailability of anything longer than a six month contract, employer abuse of H1B visas (we're looking at you, Intel, undermining a market with 20% U6 unemployment to basically hold wage slaves on the threat of deportation!), extremely high cost of living, and entrenched white-supremacist racism and homophobia. Or getting harassed by the Washington County Sheriff's Office, Hillsboro Police, Beaverton Police and the Portland Police Bureau on a twice-weekly basis for driving or waiting the bus while redskin (yet, good luck getting one of 'em to turn up any of the more than a dozen times my home was broken into or my vehicle stolen over the years; that only happened during a brief few months living in Salem, turns out Oregon State Police are the only professionals there). Or getting punched in the face by a total stranger for holding my boyfriend's hand on the MAX (Portland Police's answer? "Don't hold hands."). Worst yet, I didn't know this wasn't normal behavior for people until I just packed what I could into a duffelbag, spent the last of my money on a plane ticket, took the MAX one last time to Portland Airport and flew off into the sunrise, and discovered that Oregon, all of it, big cities included, is an unmitigated backwater yearning to be the hipster version of the Deep South.
You know your hometown has a problem when moving to an indian reservation in the midwest, sight unseen, a single bag of clothes, no savings, and no game plan, when the only thing you know that's waiting for you when you get there is a safe couch to surf, and even without taking advantage of any of the tribal benefits, it improves every aspect of your life personally and professionally, being the exact opposite of Oregon in every regard, with the sole exception of relatively minor things like sales tax rate (way lower prices and WAY higher wages more than offset this, though) and access to public transportation. I have my own car now (which hasn't been stolen yet, making 3 years and counting the longest I've ever owned a car), I have my own home now (which hasn't been broken into yet, equally record-setting), and I have job security and upward mobility (both of which are things you read about other people having if you're in Oregon).
Self sufficient income and personal safety are two things I deeply lacked in Oregon, and it's the three things I prize above everything else now (hey, you live the first 30 years of your life without those two things and the novelty won't wear off once you do). About the only way I'd ever go back there is if someone actually hired me with a high enough wage so that I don't have to deal with the locals unless I really want to, and make me well off enough inside a few months that I could go back home to Oklahoma and take the rest of the year off, or fatten
Furries make the internet go.
you are correct there, Not living there I have no idea how bad their tax code, if its anything like NYs its just as bad as federal and should also be scrapped
But since you do not know for sure, you might as well STFU and learn about it before trying to conjoin this issue with federal taxation issues (or more to the point, stop trying to shoehorn your pet-peeve issues into every single issue you come across unless you factually know the two are related.)