Apple plans a $1B bet on Nevada

Apple plans a $1B bet on Nevada

Summary: Apple looks to add another major datacenter to their infrastructure; this one in the western US.

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About $90,000,000 in tax abatements over the next decade have appeared to entice Apple to build their next datacenter in Sparks, NV, along with a business office and shipping center in Reno.  The abatements will reduce Apple's tax burden for these new facilities by almost 80% over the next 10 years. Studies have shown that local and state governments would collect about $16,000,000 in revenue from the Apple projects over the life of the abatements.

The billion dollar investment over the next 10 years comes as welcome news to an area that has been mired in the economic doldrums.  Estimates indicate as many as 41 full time jobs and 200 contract positions will become available via the Apple facilities and have over $300 million in economic impact to the local community. Construction of the facility over the next 6 months (the datacenter has a target date of ‘end of the year") would increase the short-term impact by over $100 million with more than 500 construction jobs.

Unlike Apple's previous major datacenter projects, the Sparks facility would be built within a technology industrial park that the local region has been developing with the hope of attracting major datacenter players. The planned Apple construction should make the location that much more appealing to smaller technology players and give the technology park a great start-up boost that could lead to future projects and increased tax revenue for the region.

Topics: Data Centers, Apple, Banking, CXO, Government, Government US, Hardware, Storage

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11 comments
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  • Well

    Looks like California will have to raise taxes again to make up for that loss in revenue. LOL
    LarsDennert
  • So a $90M tax abatement produces $16m Taxes - Fabulous

    So a $90M tax abatement produces $16m Taxes - Fabulous.

    All this tax abatement, subsidies, regional investmant grants does is move jobs around the country.

    Not like Apple is short of a buck or two.

    Perhaps it should build the datacentre somewhere cold, like Alaska, so it can take advantage of easier datacentre cooling. On July, the temperature nudges 100F, and it rarely falls below freezing in winter.
    neil.postlethwaite
    • bury it?

      Maybe they will take advantage of the cooler subsurface temperatures, several feet below ground.
      heymull
  • Apple and Nevada!

    As a Las Vegas resident for almost 35 years, we welcome this data Center our state. It is a very positive contribution and will be wonderful for all involved. Apple devices are fantastic and add to the growing diversity of this wonderful state. I am excited as are so many others as well!

    WELCOME APPLE!!
    vegasexcitement
  • No, no, no...

    move that datacenter to Iceland instead at that old NATO airbase! FREE seawater cooling & lots of renewable geothermal energy. :-)
    http://www.bloomberg.com/news/2012-03-22/iceland-woos-microsoft-for-part-of-41-billion-data-market-tech.html
    maxtheitpro
  • nothing like corporate welfare

    Maybe NV legislators need to take a math class. See $90M > $16M.
    Yes this creates jobs... But seriously, its time corporations paid the same taxes that we as individuals pay. Since corporations are individuals...
    cbslc
  • Michael Porter of Harvard

    http://www.isc.hbs.edu/stateprofiles.htm

    Michael Porter of Harvard has some comments on attracting business via tax relief - bottom line it is a zero sum game and everyone loses. This is a great video of his lecture to a council of governors - the Q&A make it worthwhile to wait until the crowd comes back after the fire alarm.
    pat@...
    • Porter

      Porter's excellent lecture does say that competing on tax breaks alone is a losing proposition. However, if as this article implies Nevada is pursuing a "cluster" strategy around data centers then landing a big fish as part of the core could be essential, regardless of the tax issue. Also, don't forget that the 90MM in tax revenue is actually zero if nobody else steps in with similar taxable improvements. If unimproved desert was a good tax base, Nevada would have no revenue problems at all! :)
      Biotechguy
  • automation

    as automation increases at data centers it may end up creating only 10 15 full time jobs
    preferred user
  • Corporations are people to, HA!

    According to Romney its purely evil for us to even suggest corporations should pay a little more in taxes. I think hes worried there will be less opportunities for him to buy a stake and bankrupt the company after he cashes out of them.
    SFTechGuy
  • Corporate taxes...

    This isn't really to the point of this article, just replying to some of the comments above. At the end of the day if you raise corporate taxes, these expenses are simply passed on to the consumer. So, sure it is easy to say "those evil corporations need to pay their fair share...", but that is just a political cop-out. Further, if you understand the Republic, businesses and people are supposed to be able to "vote with their feet" and leave states for better opportunities elsewhere. From a business person's point of view, it is easy to understand why Apple is setting up their data center in NV, not in CA.
    jarchca