WEST JORDAN — A project paving the way for a massive data center may mean Facebook could be coming to West Jordan.
But Salt Lake County Mayor Ben McAdams said Friday he has serious concerns about the impact it could have on taxpayers and their water resources — not just in West Jordan, but also throughout the entire Salt Lake Valley.
What's more, the mayor and a state senator worry the process has been too rapid and secretive for West Jordan residents to fully understand what may be coming to their city and the full impact it may have.
"I've lost a lot of sleep over this," McAdams said of his decision to speak out against the project. "I want to be a part of bringing a marquee name to Utah and growing our brand. … I do worry about screwing up this deal and losing an opportunity, but even more than that I worry that we're being taken advantage of and getting fleeced by a company that's pretty sophisticated."
That's because the deal that would draw the data center to West Jordan would allow a local tax break and rebate of roughly $240 million, McAdams said.
While officials, including McAdams, said they can't confirm whether the plan, called Project Discus, would house Facebook specifically — citing sensitivity to economic development projects — documents from West Jordan state the city is "working with a data center that is considering this site, among other sites, for a future facility."
And last month, Rocky Mountain power filed a request for approval of an "expedited" special renewable energy service contract with Facebook with the Public Service Commission of Utah.
Rocky Mountain Power spokesman Paul Murphy confirmed that Facebook was considering a construction site in Utah, but would not elaborate on where.
Facebook spokeswoman Lindsay Amos said in a statement to the Deseret News that Facebook is doing its due diligence to explore potential sites for the company's data centers.
“We're always evaluating potential new sites as we expand our global infrastructure and developing a pipeline for future data center locations," Amos said. "But, we're not committing to anything right now.”
Project Discus
Project Discus, according to West Jordan development plans, is a project in the city that would encompass a 230-acre, 550,000-square-foot data center within a nearly 1,700 acre area.
The area is bounded by the Old Bingham Highway to the south and 9000 South to the north. The western border ranges between 7300 and 8000 West, while the eastern border location ranges between 6400 and 6600 West.
McAdams worries the tax breaks proposed to lure the data center to West Jordan wouldn't be worth the cost to taxpayers, noting that it's not yet clear how many jobs the data center would bring, but it's estimated between 70 to 100 jobs.
"As we look at the local incentive alone … we will be paying the company anywhere from $2.4 million to $3.4 million per job, depending on how many jobs they bring in," McAdams said. "That really gives me concern — are we really doing something good for the taxpayer, or is it too costly?"
A sales tax break was made possible to an "enterprise data center" interested in building in Utah after SB3002, formerly SB178, passed the Utah Legislature in a special session last month, for which Project Discus would qualify.
UtahPolicy.com reported in July, after the first version of the bill failed, that the effort was handled quietly to prevent word of the negotiations leaking.
"Facebook was the company seeking such a large parcel, which would likely drive up the price. That's part of the reason Facebook never got a mention during any debate," states the article written by Bryan Schott and Bob Bernick. But the bill passed during the interim session.
While Sen. Howard Stephenson, R-Draper, said SB178 was supported as a tool to attract data centers to Utah, Project Discus goes too far, "giving away" far too many property taxes, since the deal could set a precedent for the other 1,500 acres of West Jordan land so other developers expect a similar deal.
"It could be the biggest folly in decades in Utah," he said. "We would be almost bound to give away the store to everybody who requests it."
Water is another concern. The data center would require 5.3 million gallons of water per day, which McAdams said could put a strain on the city and county's water resources as future developments compete for water, driving up future costs.
"That's a lot of water, and we live in a desert," McAdams said, noting that the entire city of Riverton — home to about 42,000 people — uses about 7 million gallons of water per day.
"For these 70 or so jobs, we'd be committing to the company water that would be the equivalent of water used by a midsize city," he said. "Somebody's going to have to bear the cost of that water, and my concern is that cost is going to be borne by residents throughout Salt Lake County."
West Jordan's position
In response to McAdams' concerns, West Jordan Mayor Kim Rolfe said the city will "work with Salt Lake County" through the issue.
"I hope we can work through any issue that might jeopardize this deal," Rolfe said. "But I don't think there's anything that would be significant that would impede this deal going through."
Rolfe said the city has planned "for all the impacts to our infrastructure and these plans for this particular data center."
"We've already made arrangements for the water that they will need," he said. "They will be charged for the amount of water they use just like any other business … (and) our engineers at Jordan Valley Water Conservancy District have worked on the numbers, and we're planning without that (cost) impact."
As for the tax incentives, Rolfe said the data center would be worth the cost since it would attract other businesses and more jobs to the area.
"We have been contacted by several other businesses that want to locate near this particular data center as well," he said. "It's always good to have large names … (and) to be recognized on the national map because of those names."
But Stephenson said it's not worth the taxpayer cost, noting Utah is already attracting high-tech businesses through its Silicon Slopes without such drastic tax breaks.
"So what would be the reason for wanting to attract this business unless we wanted to prove to the world that Utah is dating the prettiest company in the high-tech world," he said. "No, this is a flawed concept, and it really proves the economic illiteracy of those promoting it."
Stephenson said Project Discus could "undermine" the build-out of the Draper prison site after the Utah State Prison is relocated to Salt Lake City, because companies would know a sweeter deal was made "just a few miles away."
West Jordan was pulled from the prison relocation list last year after Rolfe argued the site had caught the attention of a major corporation, though the company was not named due to ongoing negotiations.
McAdams said no conversation about the tax break has been made with the public, even though he's been asked to provide "a blank check" for the deal to move forward.
"I think there needs to be a robust conversation and public dialogue about whether this is a good deal for us, whether the investment is going to pay off in the long run," he said. "I haven't made up my mind on where we'll go on this, but I'm very concerned. I think the public needs to participate in this decision."
Two West Jordan Taxing Entity Committee meetings will take place next week — one at 10 a.m. on Monday at City Hall, and one either on Aug. 15 or Aug. 22, depending on what the committee decides, said West Jordan City spokeswoman Kim Wells.
Public comment won't be accepted at the meetings, Wells said, adding that citizens can weigh in through their council members.
If the committee approves the plan during its Aug. 15 or 22 meeting, Wells said it would come before the city's Redevelopment Agency on Aug. 24 at 6 p.m.
Stephenson echoed McAdam's concerns that Project Discus lacked public transparency.
"This is sneaky," he said. "These kinds of decisions shouldn't be made in a corner, secretly. This needs to be well vetted in the public eye, not rushed through next week."
McAdams sent a letter to Gov. Gary Herbert Thursday outlining his concerns, but the Governor's Office of Economic Development declined to comment on the matter due to ongoing negotiations.
Email: kmckellar@deseretnews.com
Twitter: KatieMcKellar1