The Reno, Nevada City Council today approved a deal that includes $89 million in tax abatements for Apple, representing a 79 percent overall reduction in Apple’s tax burden in the city. The tax breaks apply to county, city and state taxes, and will in part encourage Apple to invest $1 billion in northern Nevada over the next 10 years.
For its part, Apple plans to build a 350-acre data center to house iCloud servers just east of Sparks, Nevada and a “business and purchasing center” in the Tessera District, a less than savory area northeast of downtown Reno.
The data center, dubbed “Project Jonathan,” is slated to employ up to 41 full time employees alongside 200 long-term contract employees, according to the AP report posted on Bloomberg’s BusinessWeek website. Construction alone could generate close to 600 temporary jobs as well, according to local paper, the Reno Gazette-Journal.
The Las Vegas Sun weighed in, however, reporting that the tax breaks will allow Apple to only send along $16 million of an estimated $343 million in economic activity over the next 10 years. The Nevada Office of Economic Development pointed out in response that the tax breaks are the reason Apple chose Reno over other possible Apple location, including Oregon, which has no sales tax.
“They’ve got lots of options,” said Steve Hill, an employee of the office. “The Prineville, Ore., area remains more competitive than northern Nevada.” Hill continued to say that construction could begin as early as August, once the project gets through a month-long approval process at the governor’s office.
It’s doubtless that we’ll see more of this sort of maneuvering on the part of regions that want to bring in Apple’s economic powerhouse to their area, similar on a macro level to retail owners courting Apple in malls across the country.