Apple, Inc. has entered into a 15-year property tax exemption agreement with the City of Prineville and Crook County for its newly planned data center in Central Oregon.
In the agreement, Apple committed to a minimum investment of $250 Million on the 160 acres of land it purchased in February for $5.6 Million. It also committed to a minimum of 35 jobs with wages at least 150% of the county average. The data center will be constructed in one of Crook County’s enterprise zones.
In return for the property tax exemption, Apple has agreed to pay local governments a $150,000 per year project fee, which will be split between the City of Prineville and Crook County.
The exact amount of the benefit to Apple is uncertain, and depends on the amount Apple actually invests in the project. Google received a similar tax break on a $1.3 Billion data center and the tax break is valued at more than $24 Million annually.
In addition to Google and Apple, Central Oregon has attracted other data centers for companies such as Facebook, Microsoft, Amazon and Yahoo. To encourage additional internet-based companies to locate in Oregon, lawmakers adopted legislation in 2012 to exempt large data centers from certain property taxes, such as taxes on the company’s intangible property. According to Rep. Tobias Read (D-Beaverton), this legislation will encourage even more internet-based companies to locate their data centers in Oregon. While data centers are not typically large employers, they have become an integral part of Central Oregon’s economic development strategy. Crook County, where the new Apple data center will be located, has an unemployment rate of approximately 15%, the highest in Oregon. City and County officials believe that these data centers will spur other development in the surrounding region.