QUINCY — Two years after Microsoft began operating a data center in Quincy, the city is in the midst of a multi-million-dollar project to bring recycled water to the facility.
Eventually, the city wants to provide recycled water to the three data centers there, and any others that sprout up.
Microsoft’s 474,000-square-foot building on 75 acres is one of three massive data centers in Quincy.
Yahoo and Intuit also bought land and built large server farms. This winter, Sabey Corp. bought about 40 acres of land in Quincy and will break ground this summer on a data center. In May, Sabey spokesman John Ford said two 286,000-square-foot buildings and one 125,000-square-foot building are planned for the site.
All of these data centers store and process Internet information, from bank records to personal e-mails. And all need or will need large amounts of electricity, and water to cool the buildings where computers run nonstop.
Now that the boom of secondary business from contractors and construction workers has settled — at least for now — some people are asking, just what is the economic impact of this new industry to Quincy and Grant County?
Officials say despite the need for water and power, the server farms will continue to be an economic boost to both the city and county.
Added tax revenue is being used to build a new library, improve city parks, buy a used truck for the fire department and support the hospital’s ambulance service. Quincy is also seeing new housing developments, and anticipates that new businesses will sprout up as a result, said Mayor Jim Hemberry.
“People are taking more pride in the community,” he said, adding, “A lot of our schoolteachers didn’t used to live here, but they are now.”
He said although the city water reclamation project is costly — estimated at $9 million — the first phase is being built with a $4.5 million grant from the state. And the city has appealed to federal lawmakers for rest of the money.
“Data centers use water to cool down. What we’ve decided to do is create this water-recycling facility that will take water from our domestic sewer,” Hemberry said.
When complete, the water reclamation facility will be able to treat up to 5 million gallons a day. Hemberry said the city only has a right to use 3.2 million gallons a day, but if it recycles industrial water to serve the data centers, that will free up potable water for other uses, including new industries.
While the three server farms were under construction, Quincy saw its sales tax revenues jump from about $800,000 a year in 2006 to more than $4 million in both 2007 and 2008, the mayor said.
Sales tax revenue is expected to drop this year, Hemberry said, but the city will make up for it in property taxes, which went from about $800,000 a year to $2 million a year, he said.
“And that’s money you can count on every year,” he said.
Grant County Treasurer Darryl Pheasant also said the added property value in Grant County due to the new server farms caused property taxes in other parts of the county to drop.
“Our property value increased by a billion dollars, because of these large industries coming in and buying property,” he said. “For over three-fourths of the parcels, taxes are less than they were last year.”
In addition to water, the data centers use lots of electricity.
Microsoft, the first software giant to bring its server farm online, became Grant County PUD’s third-largest customer in 2008, said PUD spokeswoman Dorothy Harris. She said Yahoo, the second to finish its server farm, is the PUD’s fourth-largest customer so far this year, with Microsoft still in third.
Harris said the PUD has so far been able to meet the electric needs of these data centers without having to buy power on the open market.
The public utility is obligated to meet the energy needs of any company or resident who moves into its service area, she said. So commissioners are now looking into how rates should be equitably spread among residential users, agriculture, food-processing facilities and the newer server farms.
“Our commissioners are very aware of the potential impacts, and wanting to make sure the cost of power is equitable for everyone,” she said.
The board recently passed a resolution in an attempt to protect residents and smaller commercial or irrigation customers from large rate increases in case the energy demands continue, she said.
“If our load continues to pick up at this rate, we will need to develop new (energy) resources so we aren’t dependent on the open market,” Harris added.
Curt Morris, board president for the Port of Quincy, said he expects the mere presence of the data companies will soon attract other large companies, as well as industries that provide goods or services that the server farms need.
He said while Microsoft employs only 25 to 50 people at its data center in Quincy, Morris said, “The number of vendors who come in every day because of them is tremendous.”
He said while low-cost electricity initially attracted these giant software companies, other attributes convinced them to actually build there.
Access to high-speed fiber, cool nights and the lack of natural disasters were all important aspects that can be used to help attract other industries, too, he said.
“It’s probably one of the few places where you can still buy land at a reasonable rate, but you have all this power and weather and lack of natural disasters,” he said.
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