(The TEC Council is the 8 member board comprised of various taxing entities which ultimately decides whether to accept the deal to lure Facebook here through tax incentives)
I will admit, this was a tough vote. I think many council members weren’t exactly sure which way they’d vote going into Tuesday’s meeting. I ultimately voted no for two main reasons:
First, I felt the percentage of new property tax revenue Salt Lake County would be giving back to the project was too high. The county engages in tax increment financing for economic development projects frequently. It works like this - land that will otherwise be underutilized and thus yield poor property tax revenue is developed into a much more valuable resource. A portion of the new growth in property tax revenue is rebated back to the developer after the property grows in value thanks to the new investments. On average, the county keeps 25% of new revenue for these kinds of projects. For “Project Discus,” the code name for the employer now generally known to be Facebook, we would be keeping only 15% of new revenue averaged over the 20 year life of the deal. This was simply too low, and not consistent with the many other similar economic development projects we engage in.
Second, we needed better information about the possible alternative uses of the land where the data center would be built. We knew the projected tax revenue from the data center, but lacked details on projected revenue if the land were turned into homes or a comparable commercial/industrial development with or without incentives. To make a good decision, we need as much information about the various options as possible. This one was just a little too unclear whether this data center was the highest and best use of the land.
With all this being said… we still would love to have Facebook build their new data center here. I have to give a shout out to the hard work put in by all the people involved in this project so far, but also give a little encouragement to take the next step. If we could get to a deal which gave a more appropriate percentage of the new revenue back to Salt Lake County taxpayers (25%, consistent with other projects), and know with more certainty that this data center really would be the highest yield of revenue, then I could support it.
Economic development is so vital for our county and our state. We have arguably the best economy in the nation. We have a young, educated, vibrant workforce. We have unparalleled quality of life and breathtaking scenic outdoor areas. And of course, fiber internet lines that are attractive to any tech firm. With these amenities, and a tax incentive deal that’s better for taxpayers but still enticing for Facebook, I think we could take a big step forward in welcoming a great new company to Utah and Salt Lake County.