Montgomery County Commissioner defends Google data center amid pushback, concerns
MONTGOMERY COUNTY, Mo. (KMIZ)
Montgomery County officials have released a cost-benefit analysis for a massive Google data center project that would use up to $100 billion in industrial revenue bonds and provide the company with an estimated $1.62 billion to $2.19 billion in personal property tax savings over 25 years.
The plan, prepared under Missouri’s Chapter 100 law for Kinetic Site Ventures LLC, a Google affiliate, calls for the county to issue taxable industrial revenue bonds not to exceed $100 billion to finance personal property, primarily computer servers, computing equipment and security systems, at a roughly 900-acre site near New Florence off Interstate 70.
Gov. Mike Kehoe joined executives from Google on Wednesday in High Hill to celebrate the company's plan to build the data center. Google had announced a $15 billion investment into the project.
The county would take title to the equipment, lease it back to Google and receive lease payments covering bond debt service. No taxpayer funds would repay the bonds.
Google estimates investing between $56 billion on the low end and $87.5 billion on the end in personal property from 2026-29, with additional replacement investments of $3.5 billion to $7 billion every six years after. The company also plans about $13.4 billion in real property improvements, which receive no tax abatement.
Under the proposal, Google would make payments in lieu of taxes equal to 30% of what personal property taxes would otherwise be for most taxing districts during a 25-year abatement period from 2028-52, for an effective 70% abatement on personal property. The Montgomery County Ambulance District and New Florence Fire Protection District would receive 100% of their taxes.
“The tax abatement is on personal property tax. So you do the Chapter 100 to kind of keep it more stable in there. And there's no abatement on real estate taxes,” Montgomery County Commissioner Ryan Poston said. “One of the most crucial things in there about what we're going to be able to do for communities with that in their.”
Google would pay full taxes on early equipment in 2027, estimated at about $7.37 million.
The company has committed to $5 million in annual community benefit payments once the data center has been completed. Eighty percent would go to the Greater Montgomery County Port Authority while the City of New Florence, the City of High Hill, the Wellsville-Middletown R-1 School District and the Gasconade County R-1 School District will each receive 5%.
“The city of High Hill needs a water tower welded in and repainted, The city of High Hill’s budget is about $175,000 a year maybe, and they got about $9,000 in our road and bridge fund to fix roads. They don't have the $200,000 to fix and paint this water tower, so maybe they can get a grant, maybe they couldn't,” Poston said. “So you can start helping some of these other communities around the county with other stuff that they don't have the money for. You've got industry in here paying the bills for them, trying to make every community better.”
The cost-benefit analysis must also maintain at least 75 high-wage jobs per building to qualify for the benefits. Poston defended the deal, telling ABC 17 News that the deal makes sense for Montgomery County.
“You get the most bang for your buck out of something like this. I know there's a lot of construction and moving parts going on now, and there's going to be some massive buildings out there," Poston said. "But it does not overload your public services and your infrastructure. Like if it was a car plant or a beef processing plant or something else where there's thousands of jobs. You know, four or five thousand jobs compared to what these data centers are. And there's just there's so much false information going around,” Poston said.
Poston acknowledge some of the pushback the project received from the community, but alleged much of that was due to misinformation, particularly around the jobs it would create.
“ I know in the cost benefit analysis it said 75 [jobs], that's for the tax abatement, 75 jobs per building. Tristin from Google that we’ve been talking to said there will be 300 full time jobs between the two buildings,” Poston said. “Then you'll have, like Amazon on the other side, probably the security will be a subcontractor, don't know where the subcontractor’s from, but they still hire local people to work there. And you've got the outside maintence of the building so pushing and mowing grass and all that kind of stuff, all of that could be local, that could be a local landscaping company.”
Poston claims modern data centers have improved.
“I think a lot of the misinformation that you see now is on data centers from 15 to 20 or 25 years ago. They’ve learned from the mistakes of the past," he said. "They don't want to be bad neighbors. They don't want you to see them. They don't want you to hear them. And they want to do great things for the community.”
However, Avery Frank, who is a senior policy analyst at the Show-Me Institute, noted the primary benefits are tax revenue, not jobs.
“When you think of what can a data center bring to the community, the main thing they can bring is property tax revenue and sales tax revenue and personal property tax revenue. These are the main benefits that they have because these are really huge projects, the servers inside these data centers are also liable to be a personal property tax," Frank said. "They don't bring a lot of jobs because these are just buildings full of servers using the stored data for artificial intelligence.”
When asked about potential electricity concerns, Poston said Google will cover its own infrastructure upgrades.
“Google is going to pay for all those transformers, all the upgrades to get their power to that site, the power that they need. So you get a large load customer in here. It actually helped stabilize your rates, hardening your grid and make your grid better,” Poston said.
Frank added that Google’s air-cooled design will significantly reduce the impact on water usage.
“With this Google project specifically, I read that they're using air-cooled. And so when you use an air-cooled system, you use a lot less water, but you do use a lot more electricity because half of about half of the data centers' electricity use is for cooling.”
The Google project’s tax incentives are substantially larger than those proposed for a nearby Amazon Web Services data center. Amazon’s plan forecast personal property tax breaks of about $244 million under a minimum build-out and nearly $1 billion at maximum, with a different PILOT structure. Google’s deal provides a flat 30% PILOT across most districts for the full 25 years, while Amazon will make full payment initially, then 5% for a decade, then 25% after that.
Poston said a cost-benefit analysis hearing for Google’s proposal is scheduled for June 8.
These types of data center projects have begun popping up more frequently across the country. Frank says much of this has been driven by an arms race in artificial intelligence with China.
“This trend is very interesting, one, because it's not just in Missouri, but it's across the entire country. There's a lot of desperation to get data centers online, some for the use of artificial intelligence. A lot of these hyperscale data centers are primarily for artificial intelligence,” Frank said. “As we continue to use those more, we're going to need more and more data centers. Some is also for national security. President Trump noted that we need a mass build-out of data centers to win an AI arms race with China. So there are a lot of different reasons for this investment. But for a state like Missouri that's been shrinking a lot, that's pretty desperate for a lot of investment, this could be a really big deal.”
While Frank said he is not against data center projects, they need to be evaluated on a case-by-case basis.
“Some might just completely overwhelm your water, some might completely overwhelm your electricity, some might want every single tax incentive you can get. And if they want every single tax incentive they can get, then that is not a good project,” Frank said. “If you're a local community and you're considering giving out a bunch of tax incentives, you shouldn't do it because the tax revenue you get from a data center is the primary benefit you get from a data center.
"You're not going to get a lot of jobs. You're not going to get a lot of tourists, you're not going to get a lot of accompanying development. If you're not getting the tax revenue, you have a really big building that people are really angry about, and that takes a lot of electricity and it takes a decent amount of water and people and this is not worth the cost that a data center brings.”
Data centers nationwide have been met with pushback from residents. Columbia and Camdenton each passed one-year moratoriums this month on the applications and building of data centers.
Montgomery County residents late last year and earlier this year showed out against Amazon’s attempt to build a data center in the county. Residents and property owners also filed a lawsuit in February to halt its construction.
