ECONorthwest Economic Impact Prineville`s data center

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ECONOMIC DEVELOPMENT FOR CENTRAL OREGON
ECONorthwest Economic Impact
Prineville’s data center
FACEBOOK: ECONOMIC IMPACT FACTS
• Report prepared by ECONorthwest
– 30-year-old Company
– Economic development, land-use, natural
resources, business, finance
– Measure economic and fiscal impacts
FACEBOOK: ECONOMIC IMPACT FACTS
• Overall Impacts in Oregon
– $210.4 million total capital costs
– $142.7 million economic activity
– $9.2 million personal income
– 1,081 jobs
FACEBOOK: ECONOMIC IMPACT FACTS
• Expenditure Approach
– Capital, payroll, goods & services
– Measured in two phases:
• Capital expenditure (construction)
• Operations & Maintenance (yearly activity)
FACEBOOK: ECONOMIC IMPACT FACTS
• Impacts by type:
– Direct (payroll, output, non-labor)
– Indirect (purchases of goods & services)
– Induced (further consumption & investment)
FACEBOOK: ECONOMIC IMPACT FACTS
• Capital spending in Prineville
– $15.2 million economic activity
– $6.0 million personal income
– 148 local jobs
– $1.2 million in sales on lodging, food, retail
FACEBOOK: ECONOMIC IMPACT FACTS
• Operations spending in Prineville
– $21.3 million in economic activity
– $5.5 million personal income
– 111 jobs for local workers
FACEBOOK: ECONOMIC IMPACT FACTS
• Operations spending in Prineville
– 55 full-time jobs currently
– Avg. wage = $59,400 (wages + benefits)
– 35% above avg. wages across region
FACEBOOK: ECONOMIC IMPACT FACTS
• Operations Economic Multiplier
– Output = 1.3
– Personal income = 1.7
– Jobs = 2.0
– $1 million payroll = $700,000 more income
– 10 jobs created by FB = 10 jobs elsewhere
FACEBOOK: ECONOMIC IMPACT FACTS
• FB spending has potent economic effect
1. Above average wages support more
consumption-related spending
2. Developed strong supply-chain in Oregon
3. Supply-chain partners support above avg.
wages of ($64,200) that support additional
consumption-related spending
FACEBOOK: ECONOMIC IMPACT FACTS
• What if facebook didn’t exist?
“The economic contributions of facebook are enhanced
by the nature of its operations in Oregon and the fact
that almost all of the revenues used to finance its
operations are from non-Oregon sources. In this
regard, all of the spending by facebook and the
associated economic and fiscal impacts are considered
net new impacts for the state.”
FACEBOOK: ECONOMIC IMPACT FACTS
• What are the trade-offs?
– Do data centers use too many resources?
• Water, sewer, power
– Is the 15-year tax incentive worth it?
FACEBOOK: ECONOMIC IMPACT FACTS
• Facebook water usage
– What’s the comparison to other businesses?
•
•
•
•
Woodgrain:
Contact:
NW Laundry:
Facebook:
172.91 gpm
68.85 gpm
62.08 gpm
28.00 gpm
FACEBOOK: ECONOMIC IMPACT FACTS
• Long term plan for water?
– Water capacity exists, but infrastructure
improvements needed. Future data centers
to pay for any and all upgrades
– Facebook funded water study
– Feasibility of utilizing city’s wastewater
FACEBOOK: ECONOMIC IMPACT FACTS
• Data center power usage
– Varies based on size and scope
– Average usage 28 MW per 330,000sf
– Data centers pay 100% for power
FACEBOOK: ECONOMIC IMPACT FACTS
• Is there enough power capacity?
– 720 MW currently in regional system
– 796 MW by July 2013
– 1077 by mid 2014
– 1,477 in 4-5 years
FACEBOOK: ECONOMIC IMPACT FACTS
• Long-term enterprise zone tax incentive
– Offers 15-year tax incentive for rural,
economically distressed communities
– Must create and maintain 35 jobs
– Pay 150% above average wages
– Minimum investment level: $8.8 million
FACEBOOK: ECONOMIC IMPACT FACTS
• Long-term enterprise zone tax incentive
– Facebook saves about$1.5 million per year
– However, community is getting:
• $21.3 million in economic activity
• $6.0 million in personal income
• 111 jobs
FACEBOOK: ECONOMIC IMPACT FACTS
• Long-term enterprise zone tax incentive
– Helps with job recruitment efforts
– Creates competitive business climate
– Approved by city/county in a public hearing
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