The Economic Development Objectives Committee met Jan. 7 to discuss possible community benefit agreements for large data center developments.
The committee invited Dean O’Connor, the mayor of Altoona, Iowa, along with the city’s economic development director, Chad Quick, to provide insight on data center developments. Altoona is home to a 5.5 million-square-foot data center complex owned by Meta, formerly called Facebook, which was approved for development about 12 years ago.
The committee, which discusses a variety of topics related to economic growth in the county, is made up of Jefferson County Council members, as well as volunteer members. Councilmen Brian Haskins (District 1, High Ridge), Billy Crow (District 2, Arnold) and Scott Seek (District 5, Festus) were absent from the meeting.
The meeting was the fourth and final held by the committee to talk about formulating regulations for data centers that eventually could be developed in unincorporated Jefferson County. A data center is a building or group of buildings that houses equipment needed for computing, such as routers, servers, switches, firewalls and storage systems.
County Services Director Mitch Bair said his staff will draft recommended data center development language over the next few months and likely present the proposal at the March 12 Planning and Zoning Commission meeting, set for 6:30 p.m. at the Ken Waller Memorial Building, formerly called the Jefferson County Administration Center, 729 Maple St., in Hillsboro. The meeting will include a public hearing.
At the Jan. 7 meeting, members and guest speakers discussed what could be included in a community benefit agreement (CBA) and workforce development clause for data center developers. A CBA can include legally binding requirements, like hiring locally, expanding public services or providing grants to nearby schools.
O’Connor said he was on the Altoona City Council when it voted to approve Meta’s development proposal. He said it was a battle at first to negotiate with Meta, with the state and local government offering numerous incentives to woo the multi-billion-dollar tech company to build in Altoona.
“When Meta came to us, it was brand new. There wasn’t all this uproar about data centers, power and water,” O’Connor said. “It’s a different world (now). Back then, we were chasing them. Now, they’re chasing you. You can negotiate a lot differently than we did back 12 years ago.”
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O’Connor said the city fought to get Meta to choose Iowa over other states, adding that he was under pressure from the state’s governor and economic development commission to close the deal. Meta was given numerous incentives to build in Iowa, including zero sales tax on all equipment installed in the data center and no property taxes for the first roughly 20 years of development.
Quick said Meta’s complex is currently assessed at $1.3 billion. Right now, if Meta were paying property taxes on the complex, it would pay about $43.5 million a year across all taxing entities, he said.
O’Connor commended Jefferson County officials at the meeting for having the foresight to develop codes related to data centers ahead of any submitted proposals.
“I love what you’re doing,” he said. “You guys are in a really good spot because you’re talking about this before you’re necessarily getting a lot of those calls (from developers). We were writing code as we were trying to work through this process. We didn’t have a definition of a data center. We didn’t have a noise ordinance at the time, and honestly, we still don’t have those words.”
County Executive Dennis Gannon said he recently spoke with officials from St. Charles to learn “what happened (and) what failed” with the proposed data center for the city that was abandoned last summer following a public outcry.
Opponents to the data center said they are concerned the development could lead to energy rate hikes, extensive water usage and pollution. The proposed data center developer ultimately withdrew the proposal.
“I asked if they could have a do-over on this, would they do a data center again? They said, ‘Absolutely, yes,’” Gannon said. “The big warning is that there will be a concerted effort, no matter what the outcome is, to have people from outside the city, outside the county and outside the state to oppose this. There would be aggressive opposition, but there will probably be passive support for it.”
In the 12 years since Meta came to Altoona, O’Connor said he hasn’t heard any complaints from neighbors or other residents about the data center’s operations.
“I tell people all the time, it’s something that we can brag and hang our hat on,” he said. “It’s added a lot to our community.”
Bair said the strongest, most impactful CBAs focus on infrastructure cost recovery, environmental performance, long-term community funding, transparency and enforceability.
When a data center developer comes to Jefferson County, staff can require community investments that improve residents’ quality of life, Bair said.
“Number one would be an annual grants program administered locally for a specific, defined purpose,” Bair said. “There’s education and STEM initiatives, depending on the school district and the college, that most likely could take advantage of that. There’s also digital equity, like expanding internet, broadband or fiber.”
Meta paid $11 million to construct a new water tower and sewer line for Altoona, in part to bolster its own water supply, O’Connor said. The city annexed 900 acres recently, largely because of the extended sewer line funded by the tech company, he said.
Bair said there is a “tremendous opportunity” to grow Jefferson College with the help of a large-scale data center development, including job training programs and workforce development.
Quick said Meta was a major sponsor of a skilled trades building at the city’s high school, and the tech company also offers annual educational and community grants.
O’Connor said there are additional benefits to having a major tech company develop in his town, like job and population growth. Since Meta came to the city, Altoona’s population has grown from roughly 14,000 to about 23,000.
Quick said about 400-450 full-time employees work at the Meta data center, including construction workers, engineers and technology experts.
O’Connor said the jobs are high-level and reliable. Since Meta is constantly updating technology to become more efficient and expand services, there are always jobs available, he said.
“We’re talking piles of electricians out there all the time, welders, ironworkers,” O’Connor said. “The construction alone has been going on for 12 years. How has that added to our community? People are buying offices, going to our schools and shopping in our shops. It’s people living in our community and raising their families.”