Google Wants $15M in Tax Breaks to Build a Data Center in Minnesota • Hacker News Board

Re: Google Wants $15M in Tax Breaks to Build a Data Center in Minnesota

#101

Post by nightski » Tue, Mar 05, 2019, 12:38 AM UTC

tptacek wrote: post #77

bilbo0s wrote: post #60

Earlier quoted context omitted.

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…

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…

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

Re: Google Wants $15M in Tax Breaks to Build a Data Center in Minnesota

#102

Post by tptacek » Tue, Mar 05, 2019, 12:42 AM UTC

abakker wrote: post #89

tptacek wrote: post #83

Earlier quoted context omitted.

I read that too and don't understand it at all. Do you? By "shortfall", do they simply mean "if we charged full property taxes to Google, the revenue we'd get would be much more than the taxes we'd get from the 50 FTEs at the data center"? "Shortfall" suggests money the city and county would essentially be "spending" to have the data center, but that's not what's happening, right?

https://www.taxnotes.com/editors-pick/google-seeks-20-years-... that seems to be a much better article, but still doesn't elaborate on that "shortfall". The Taxnotes article makes this seem like a much better deal for the down, and a much more reasonable ask from google. They are effectively asking that they be granted a reduced increase in taxes on the proposed vast increase in property value from the value of their…

What a great find. Thank you!

Re: Google Wants $15M in Tax Breaks to Build a Data Center in Minnesota

#103

Post by tptacek » Tue, Mar 05, 2019, 12:44 AM UTC

nightski wrote: post #101

tptacek wrote: post #77

Earlier quoted context omitted.

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…

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

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.

Re: Google Wants $15M in Tax Breaks to Build a Data Center in Minnesota

#104

Post by tptacek » Tue, Mar 05, 2019, 12:44 AM UTC

supernovae wrote: post #92

tptacek wrote: post #77

Earlier quoted context omitted.

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…

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…

What risk are taxpayers taking?

Re: Google Wants $15M in Tax Breaks to Build a Data Center in Minnesota

#105

Post by gwright » Tue, Mar 05, 2019, 12:45 AM UTC

jamiequint wrote: post #47

alehul wrote: post #36

Earlier quoted context omitted.

The only way seems to be to either to completely outlaw these negotiations, or create a standard rate (i.e. if the project will bring 100 jobs, the cities have the option but not the obligation to offer $10m in various forms of tax breaks— or maybe capped at $10m). The trouble is that, at a higher level, this unwillingness to play ball may just result in the companies fleeing to other countries rather than other stat…

You can't outlaw them without modifying the US Constitution due to the 10th Amendment as it concerns states rights. Individual states could outlaw it, but they would just be putting themselves at a disadvantage relative to other states that did not.

I'd like to understand why the 14th Amendments provisions for due process and equality under the law aren't applicable. Seems to me that whatever taxing regime a state designs should be applicable equally to all legal entities (people/corporations/llc/etc). No favorites.

Re: Google Wants $15M in Tax Breaks to Build a Data Center in Minnesota

#106

Post by chrisco255 » Tue, Mar 05, 2019, 12:45 AM UTC

supernovae wrote: post #96

chrisco255 wrote: post #85

Earlier quoted context omitted.

There's no need to disparage software devs as brogrammers, especially in this context.

Not sure why you felt the need to be offended.

Because your comment adds nothing to the discussion and flattens people based on some dumb trope. It's just cynical junk thinking.

Re: Google Wants $15M in Tax Breaks to Build a Data Center in Minnesota

#107

Post by supernovae » Tue, Mar 05, 2019, 1:01 AM UTC

chrisco255 wrote: post #106

supernovae wrote: post #96

Earlier quoted context omitted.

Not sure why you felt the need to be offended.

Because your comment adds nothing to the discussion and flattens people based on some dumb trope. It's just cynical junk thinking.

Apparently, I offended you. I am sorry to offend you. My goal is not to offend you but to mock a culture I find appalling just as I mock the concept of granting tax incentives to hugely profitable companies as offensive. Humor is how I cope with a world where daily news is talking about extreme poverty, extreme profit and very little for those - who may be like you or me well in the middle who are pawns in these games that see little to no reward and end up being 0 sum in the grand scheme of things.

yes, i could have said programmers and most people will read it as programmers but truth be told, to the good people of this town - they're going to see these programmers as elites making money off their taxes when it comes to the time to those tax revenues matter... you know, when these companies inevitably ask for more because they got it to begin with

Re: Google Wants $15M in Tax Breaks to Build a Data Center in Minnesota

#108

Post by mruts » Tue, Mar 05, 2019, 1:19 AM UTC

maxxxxx wrote: post #26

mruts wrote: post #18

Earlier quoted context omitted.

Why would a financial firm care about 15ms latency to a google service? It's not like they would be using the cloud in the first place.

True. They go straight to the exchange.

Colocation costs have gone down in recent years and any firm who cares about latency (which, honestly, is only a small minority), already has it. No one, and I mean no one, gives a shit about Google’s latency in Minnesota.

Re: Google Wants $15M in Tax Breaks to Build a Data Center in Minnesota

#109

Post by chrisco255 » Tue, Mar 05, 2019, 1:25 AM UTC

supernovae wrote: post #107

chrisco255 wrote: post #106

Earlier quoted context omitted.

Because your comment adds nothing to the discussion and flattens people based on some dumb trope. It's just cynical junk thinking.

Apparently, I offended you. I am sorry to offend you. My goal is not to offend you but to mock a culture I find appalling just as I mock the concept of granting tax incentives to hugely profitable companies as offensive. Humor is how I cope with a world where daily news is talking about extreme poverty, extreme profit and very little for those - who may be like you or me well in the middle who are pawns in these game…

https://www.mprnews.org/story/2019/02/25/wind-energy-tax-bre...

Look, the incentives are reductions in property taxes for building a $600 million data center powered by carbon-free electricity. That's 2.5% of the total investment into the property. The city and state will still pull in tax revenue from Google in the form of property taxes over the 20+ years it will run for.

Besides that and more to your point, coming from a small town myself, they're going to see these data center employees as peers and neighbors that spend money at their restaurants, retail, and other businesses supporting the local economy.

Economics is not a zero sum game.

Re: Google Wants $15M in Tax Breaks to Build a Data Center in Minnesota

#110

Post by nightski » Tue, Mar 05, 2019, 1:34 AM UTC

tptacek wrote: post #103

nightski wrote: post #101

Earlier quoted context omitted.

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

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.

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.