Facebook plans $300M Iowa data center

DES MOINES, Iowa (AP) -- Iowa economic development officials on Tuesday approved tax credits for Facebook Inc. to build a nearly $300 million data center in Altoona and increased incentives for Google Inc. that allows it to expand in Council Bluffs.

The Iowa Economic Development Authority board approved $18 million in tax credits for the Facebook project to be built near Interstate 80 in Altoona, a Des Moines suburb. The project is expected to create 31 permanent jobs and hundreds of construction jobs.

Kearney, Neb., also sought the project.

"The feeling here is one of relief and joy because we've been working on this for a year and a half and we were in competition with Nebraska," said Debi Durham, director of the Iowa Economic Development Authority. "From a branding point of view it doesn't hurt to be friends with Facebook does it? We're quite excited about it."

The Facebook project that was approved is expected to be the first of three similar-sized data centers, each about 300,000 square feet, to be built on a 194-acre site. The total value of the Facebook investment is expected to exceed $1 billion when completed, Durham said.

Altoona will provide a 20-year property tax exemption

The jobs must pay at least $23.12 per hour.

"We're thrilled to become a part of the Altoona community, and especially appreciative of all the partners who helped make this project happen," Jay Parikh, vice president of infrastructure engineering for Facebook, said in a written statement. "Facebook's mission is to connect the world. Thanks to Iowa, we're building the global infrastructure to bring the next billion people online."

The Facebook project was kept under wraps for more than a year as the company negotiated on a location for the project.

"This is a glorious day in Altoona. It's no secret any more folks," said Mayor Skip Conkling.

Gov. Terry Branstad applauded the project, saying the entire state will reap the benefits of the millions of dollars in investment, the jobs and tax revenue.

"It's a big win for everybody. We're so excited to win a prize like this," Branstad said. "Facebook is certainly a well-known name. Facebook is one of the exciting modern success stories and we're so proud they've chosen Altoona."

In Council Bluffs, Google plans to build another data center alongside an existing $600 million center. It's increased the cost of the new data center to $700 million from the original $300 million, and the state increased tax credits from less than $10 million to $16.8 million.

Iowa has successfully attracted major internet players Microsoft, Google and now Facebook with its inexpensive and reliable electricity, ready access to high speed internet connections through its network of fiber optic cables, and secure buildings that are not prone to damage from natural disasters such as earthquakes, floods or hurricanes.

Data centers typically are extremely large buildings that house computer servers designed to store massive amounts of data. They typically create few jobs. The Google facility employs 35.

"Our commitment to Council Bluffs and Iowa grows stronger each day," Google Data Center Operations Manager Chris Russell said. "As demand for our services grows, our operations need to grow as well. We're excited to be an integral part of Iowa's expansion into next generation technology."

In 2010 the company entered into a long-term agreement to buy wind energy from a central Iowa wind farm and last year Google invested $75 million in another Iowa wind farm.