Apple CEO Tim Cook touts data center in Des Moines visit

$1.3 billion project to be online by 2020

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DES MOINES — Apple Inc.’s plans to locate a $1.375 billion data center complex in Waukee — aided by more than $213 million in state and local investments — represents another building block in Iowa’s march to become a “new home for innovation in America’s heartland,” the company’s chief executive officer told Iowans who gathered for the official announcement outside the state Capitol building Thursday.

The two 400,000-square-foot-state-of-the-art facilities, to be built on 2,000 acres in Waukee, will run entirely on renewable energy to power North American users of Apple products and services and will create more than 550 construction and operations jobs in the Des Moines area, Cook said.

In addition, the company will contribute up to $100 million to a newly created public improvement fund dedicated to community development and infrastructure around Waukee, he added.

“Data centers like this new facility are critical to Apple’s operations and they make up the backbone of America’s innovation infrastructure,” Cook said.

With construction slated to begin early next year — and plans to bring the data center and its 50 high-paying jobs online in 2020 — he said the operation will bolster Apple’s existing support network of 30 companies in Iowa to “deliver the horsepower for the technologies of tomorrow.”

The Statehouse event came a few hours after state and local officials had approved incentives to help land the project after a 20-month search process. The state Economic Development Authority board awarded $19.65 million in state investment tax credits for a pledge to create at least 50 jobs, at a qualifying wage of at least $29.12 per hour.

The city of Waukee approved multi-year property tax abatements and infrastructure improvements totaling about $194 million.

“For the past 20 months, Apple has been searching for the perfect location, and I am so proud to say that they found it right here in Iowa,” Gov. Kim Reynolds said Thursday. “This puts Iowa on the world stage. This gives us an opportunity with a global company like Apple to say we are the place to be, this is where your business should locate.”

Reynolds credited Iowa’s productive workforce, central location, infrastructure and lead role as a provider of low-cost renewable energy as key factors in Apple’s decision to join other tech giants such as Facebook, Google and Microsoft to build data centers in Iowa.

She defended the state’s investments, telling reporters “these are credits, it’s not a check” to attract a company willing to investment nearly $1.4 billion in the first phase of a project that will help grow Iowa’s economy for the future.

“This is a company that is investing in Iowa and in our community and in Iowa, and if we want to grow this economy and provide more revenue, then we should be doing what we can to bring jobs and businesses to the state of Iowa,” she said.

“It is a minimal investment for the amount of investment that’s being done in the state of Iowa,” Reynolds added. “This is an investment that will continue to pay dividends way beyond today. This is an investment in Iowa’s future.”

The governor’s office issued a statement saying data center projects have economic impact well beyond the permanent jobs created and the initial capital investment made. Officials pointed to a recent study released by the U.S. Chamber’s Technology Engagement Center that estimated a typical data center:

• Employs 1,688 local workers

• Provides $77.7 million in wages

• Produces $243.5 million in output along the local economy’s supply chain

• Generates $9.9 million in revenue for state and local governments.

Every year thereafter, the data center supports 157 local jobs paying $7.8 million in wages, injecting $32.5 million into the local economy and generating $1.1 million in revenue to state and local governments.

Jay Byers, chief executive of the Greater Des Moines Partnership, said Thursday’s announcement continues to enhance Iowa’s status as the “silicon prairie” and will further build out the supply chain associated with these large data centers.

“It’s a huge win for our economy,” Byers said. “Central Iowa is now a global hub for data centers.”

Matt Sinovic, executive director of the Progress Iowa multi-issue advocacy organization, called the state’s investment a “a fiscally irresponsible tax giveaway” to a large, prosperous corporation.

“Apple is just the latest company to fleece Iowa, crippling our ability to invest in schools, workers and health care in the future. The Reynolds budget crisis was created because of fiscally irresponsible tax giveaways,” Sinovic said in a statement. “How will we ever recover when the governor keeps letting companies take bigger bites of our future revenue?”

However, Adam Gregg, the state’s acting lieutenant governor, drew a different conclusion, calling Thursday “a red-letter day” for the state.

“This is one of those moments when you pinch yourself,” Gregg told the Statehouse gathering with Reynolds, Cook and Waukee Mayor Bill Peard.

Tina Hoffman, spokeswoman for the Iowa Economic Development Authority, told the Washington Post that building the project will bring more wealth to the community.

“With a billion plus investment, it will also create many spin off and construction related jobs,” she said.

l Comments: (515) 243-7220; rod.boshart@thegazette.com

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