Facebook is adding two buildings to its Prineville data center, a project that will bring hundreds of millions in capital investment and several more years of construction work to a former wood milling town of less than 10,000 people.
The Palo Alto, California, social media giant made the announcement Tuesday, two weeks after Prineville and Crook County signed an agreement that gives Facebook a 15-year tax exemption in exchange for less than a dozen jobs and six-figure cash payments. Facebook’s Prineville data center already has three major buildings and a smaller “cold storage” building — a total of 1.2 million square feet under roof, city planning director Phil Stenbeck said.
The fourth and fifth data-center buildings and accompanying administrative building will total 820,000 square feet, he said. The new buildings will go on 240 acres adjacent to Facebook’s current 140-acre campus. Facebook bought the additional land from Crook County on Dec. 5 for $5.4 million.
Prineville competed with other communities for the additional data-center buildings, which the company calls “data halls.” The incentives offered to Facebook are similar to past agreements, said Roger Lee, executive director of Economic Development for Central Oregon, a nonprofit group that works with local government. The available land, along with 100 percent tax abatement for the buildings and equipment, continue to make Prineville attractive, he said.
Facebook is in a long-term rural enterprise zone and has received $71.6 million in property-tax breaks since 2012, according to Crook County Assessor Brian Huber. The company has paid $202,860 in taxes on the underlying acreage.
City and county officials would not disclose the latest enterprise-zone agreement, but they said terms were similar to two past agreements. Facebook’s new buildings and equipment will be tax exempt for 15 years, as long as the company fulfills its commitment to create jobs. Prineville Mayor Betty Roppe said she wasn’t sure how many jobs Facebook must create, but she’s confident the company will live up to the agreement.
“They’ve always surpassed that,” she said.
Facebook committed to creating 10 new full-time jobs, said Amy Hunter of Weinstein PR, a Portland firm working for Facebook. She said the Prineville data center currently supports 200 people working full-time, and that three-quarters of them live in Prineville. It’s unclear how many people Facebook directly employs, as some of those 200 people work in security, cleaning and culinary for third-party contractors.
Facebook would not respond to requests for interviews, Hunter said. She suggested media inquiries be directed toward local officials, including Roppe and Crook County Judge Seth Crawford, an elected official whose role is the same as chairman of a county commission.
Roppe reiterated talking points from Facebook’s announcement and added that the city of Prineville is prepared to house large numbers of construction workers.
“We feel that we’re not going to have a problem with housing,” she said.
Each Facebook building will employ a construction crew of 400 to 500 people for 18 months, Stenbeck said. Most of those workers drive in from surrounding communities, and, as The Bulletin has reported, many of them booked long-term stays at local hotels in the past.
Work will begin this month on data building four, which will begin serving traffic in 2020, according to Facebook’s announcement. Building five will break ground next year and go live in 2021.
“We’ve probably got housing for an additional 200 people this year,” Stenbeck said.
Prineville has added a 30-lot RV park; three duplexes and a fourplex; 62 new single-family homes; and a new boarding house with 12 beds on the second floor of a downtown building, Stenbeck said. Construction is underway on a new apartment building with 14 units, he said.
The enterprise-zone agreement with Facebook also calls for the company to pay the city and county $250,000 a year for the next 15 years, Crawford said. Those payments will overlap with ongoing payments totaling $300,000, which are the result of two previous enterprise-zone agreements, he said.
Crawford said he wanted to be transparent, but first, he said, he wanted to obtain Facebook’s permission before going into detail about the cash payments. Because the payments aren’t a permanent revenue stream, the county has put most of its cash into reserves, he said. The money also helped offset the construction cost of a new jail, he said.
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