Sidebar Sidebar
Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.

Apple to Build $1 Billion Server Farm in NC

gangst said:
Can't you see that by Apple coming along and setting up shop it strengthens NC's economy.
Click to expand...

First off the major point of what you quoted there was to illustration what issues folks may have ( based in the numbers or not ) would have with issue.

Second, just "setting up shop" isn't the point. The point is paying a company to set up shop in your company. That isn't capitalism if it doesn't bring in more money that you cut in revenue. Capitalism is when people pay for what they get. Most everyone else in NC has to pay taxes. Apple is getting a free ride.

That is fine if it brings in more money than they dropped in the break.


The factory workers, farmers etc who you mention and who may have lost jobs will have greater protection in the future as large installments like this create jobs.
Click to expand...

If Apple doesn't hire them it won't. If the new Apple employees don't participate with dollars in their local communities it won't either.

Did your local Member of Parliament get the tax payers to build a moat around his/her house too? Wasn't that great stimulus dollars for your community? It brought jobs didn't it? If the London Olympics burns more money that it brings in is that great example of capitalism?


$46 million for 50 long term permanent jobs is very close to $1 million a job. Over ten years that's roughly $100,000 a job per year. Screw all that "billions and billions" fluff. Ponder that. Does that sound like a good deal? Those billions and billions are not going to be for the salaries of those folks. Depending upon how much remote admin they do, perhaps not even close to 1% of that.

If Apple were coming to employ 1,000 folks I think it would be easier for folks to grok that this will pay off. The fact that jobs are so few and likely either very specialized or very low end (pushing pulling equipment, mowing the lawn, guard duty watching the deer go by outside the facility, etc. )

The return is coming from something other than salaries. Any reasonable analysis quickly shows that.

Apple is a computer company show you really think they are going to buy whole lots of computers and charge themselves sales tax. or ... the computers come off the boat and get shipped to data center. On Apple's books that will look as a big asset "spend" (so will count toward their tax deduction). For local NC taxes most likely that will be a big fat zero.

Electricity (unless they set up some huge wind/solar farm) will probably get taxed. Some other equipment may/may not get taxed depending upon where Apple buys it.

If spent to maximize NC tax revenue the $1Billion could add up to offset the deductions Apple is getting. However, the fact is that Apple would only come if they could duck taxes. So how likely is it that they are going to set it up so that NC gets max tax gain on the spend?

If the government folks did some slipshot public policy analysis it may not add up. It doesn't "have to" just because it is 'billions and billions'. It may, but the stuff they had talked about so far from convincing. For instance, if Duke Energy is handing a wads of money they are as likely to buy something outside of NC (another chain of nukes/plants ) as they are to buy something inside. Similarly what tax coffers does the utility tax go into versus the one that is being reduced with the Apple breaks. ( is the state going to be able to rob peter to pay paul to shift that from one bucket to another? )





A big tech installment also acts to inspire younger generations to pursue a career in tech.
Click to expand...

50 jobs? What do you think the turnover is going to be like? The majority of those folks who get hired next year will still be in their jobs when the younger folks graduate.

Most of the "work" being done/initiated by people on the machines in the data center will not be in NC.


There are nations which would give a lot more than a $46 million tax break for Apple to set up shop and this may have played into NC's 'generosity'.
.
Click to expand...

I'm sure Robert Mugabe would print out a whole stack of money to have Apple comes to his country. If he had to print out 600 billion Zimbabwe dollars per job it might not be a good idea economically for the country.

Carried to the extreme this is also a trap for communities. To fill in a few gaps where the cost benefit works is fine. But to get into bidding wars trying to buy companies to come to your location.... not a good idea. Have to be willing to push back from the table if it doesn't make sense. There are "new" Apples out there also. Some of them may be more long term comitted to the community without the pay off.

If you have to pay someone to be with you, what kind of relationship do you have?

$6.8 million for 183 acres... LOL.. $6.8M wouldn't even get an acre out in Silicon Valley. NC has values going for it.
 
BBCWatcher said:
Also bear in mind that Apple doesn't actually need the $46 million. Apple has a couple tens of billions sitting in the bank already. It is an extremely profitable company.
Click to expand...

...and they intend to stay that way.
How do you suppose they ended up with so much cash? Not by spending money like Michael Jackson.
 
jbernie said:
Corporations holding government to ransom over tax revenue is poor form but as no one is willing to ban it, it will continue on until someone somewhere royally screws up and the Feds have to step in.
Click to expand...

The Feds do it too. Why do think the Tax code law runs 1,000s of pages long? LOL.

In measured doses, it can work out favorably for both sides. However, yeah it is almost a game at this point. So many companies get breaks that other companies get bent out of shape that somehow they are being out hustled so they crank up their game too. The ones who don't get a deal are going to moan and groan about how screwed up the system is ( of course is things went their way they'd be happy as pigs in mud).
 
Why does everyone keep saying my state, dear old NC, is paying Apple $46 million? They aren't paying Apple a dime. They are giving them a tax break of $4.6 million a year. Knowing property taxes in my area, and even more, knowing commercial property taxes on my warehouse that is 100,000 sq plus, Apple will STILL be paying a several million dollar tax bill each year.

You people are idiots. NC threw Apple a bone. We could have either had an empty field, or we give Apple a huge tax break, and it is huge, but still bring in several million a year in taxes, PLUS, the taxes of all 50 employees. Even if NC only nets $1 a year, isn't that dollar better than $0? There is nothing there right now.

Explain your idiotic logic to me again please.
 
solarkismet said:
Agreed. If these jobs average $100,000/yr for 20 yrs and NC's tax rate is 5%, they might break even (and that's generous). Sure there are other benefits, but it smacks of a questionable investment of taxpayer money, kind of like sports stadiums.
Click to expand...

What are you agreeing with???? NC is not investing / spending any money - they are not at risk with any tax payer $$$.

This sounds to be structured as a tax BREAK - no $$ investment from NC.
 
deconstruct60 said:
$6.8 million for 183 acres... LOL.. $6.8M wouldn't even get an acre out in Silicon Valley. NC has values going for it.
Click to expand...

I happen to like our cheap real estate. My state also doesn't have quite the deficit yours does, nor the sub-prime disaster, nor the absolute lack of available land.

Apple could probably build a server farm in ND even cheaper, hell, in this economy, land is probably cheap in any rural area. But they wanted it on the East Coast and I guess NC won.

It isn't a lack of value thing, we're just not as developed and overpopulated. Please, stay out there. Please, we like it nice and empty here. ;)
 
adammull said:
Why does everyone keep saying my state, dear old NC, is paying Apple $46 million? They aren't paying Apple a dime. They are giving them a tax break of $4.6 million a year. Knowing property taxes in my area, and even more, knowing commercial property taxes on my warehouse that is 100,000 sq plus, Apple will STILL be paying a several million dollar tax bill each year.

You people are idiots. NC threw Apple a bone. We could have either had an empty field, or we give Apple a huge tax break, and it is huge, but still bring in several million a year in taxes, PLUS, the taxes of all 50 employees. Even if NC only nets $1 a year, isn't that dollar better than $0? There is nothing there right now.

Explain your idiotic logic to me again please.
Click to expand...


+1 Better to have a business there and help the local economy than nothing at all.

Guess the people whining and complaining would rather have no work than some work.

And yes, NC isn't investing any money, nor are the people living there. This is a good thing. It's economic stimulation and basic common sense. People get jobs at server farm, people now have cash in pocket, people go out and buy things from local stores, all in all putting money BACK into the local economy.

Apple still has to pay it's local taxes, they just wouldn't pay as much if there wasn't a tax break which is why this was a sweat deal for them and a good deal for the local area. Hell if Apple wanted to build here in north georgia I wouldn't be complaining, more money for the local economy. Those workers gotta eat, sleep, wear clothes, etc. That's good news.
 
The first 10 years NC 'loses' $46 million revenue. People Apple brought to work in the facility will pay taxes every year; They'll bring their families there; They'll buy sandwiches from local sandwich shops on the way to work; They'll refuel their cars in local petrol stations every single year.

The facility will also soak up local unemployment; The unemployed gets paid, on their way to work they buy sandwiches from local shops, etc.

And what about every 10 years after that? Apple will pay $46 million in property taxes, every 10 years after the first; It's a 1 billion dollar facility, I don't think Apple will leave it in 10 years.

30 years for 92 million dollars of tax; Construction work; Jobs for local unemployed; Economy stimulation for every single worker Apple brings in.; Every Single Year.

Hell, our state government would likely give 100 million dollars to Apple in addition to $46 million tax cuts just to have Apple set up a facility in my area. (100 million I think is too much...) $46 million forgone taxes is cheap.

EDIT: And we still haven't mentioned what the local sandwich shop owners would do with their extra revenue.
 
Why go after the red herrings?

Guys, why's everyone focusing on the least interesting element sof this announcement: taxes, location, economy, blah... I clicked on this thread for some good ole' speculation. C'mon folks...

MobileMe... is it really worth that kind of investment for Apple?
Some Google/Yahoo/Bing thing... I don't think Ap would want that headache.
Some vast rendering farm for animation / video production... mm.

I would think something to compliment either the iPhone and its accessibility, or iTunes/Apple TV seem like the most reasonable avenues... something to grease the delivery of its more consumer-entertainment-targeted hardware, of which Apple has enjoyed the most violent of success and less on the computers, which remain a steady spine and benefit off the permeation of the Apple brand.
 
adammull said:
I happen to like our cheap real estate. My state also doesn't have quite the deficit yours does, nor the sub-prime disaster, nor the absolute lack of available land.
Click to expand...
I like your cheap real estate too.
If your state passes up revenues with non-breakeven payoffs of a couple $100 million a pop to a long list of companies you'll have a deficit also. Substantive contributing reason why CA is in debt is because cut revenue and that had no offsets. ( not just over spending, although that plays a role too. )

There is more farmland that could be flipped into data centers in CA than there is in NC. It is a very big state with huge range in density and land usage.


Apple is unlikely to completely dump the couple data centers have here. Should have a backup somewhere else than the prime one though. (prime could end up the NC one though). East Coast makes sense. Unlikely for both coasts to have major natural disaster at the same time among other things.


If swamping farm property taxes for commercial taxes would jack up the revenue per acre alot then sure the deal pays for itself. Likewise if the "promise to buy local" isn't chock full of easily escaped loopholes. If so why is it described as jobs , jobs , jobs.


from the observer article:

In addition to 50 new full-time jobs, the center is expected to bring 250 indirect jobs and Millar said the impact could eventually be 3,000 jobs in related industries.
Click to expand...

5 indirect people for every one person employed? These are $50K jobs; an echo effect of 5? then 60 ?

Taxes on 50 $50K jobs. No way that pays off the amount given by the state on its own.

When government folks point to the stuff that doesn't matter most folks should be concerned. That's not a sign they know what they are doing.


It isn't a lack of value thing, we're just not as developed and overpopulated.
Click to expand...

Probably should have stated that as no lack of a value proposition. The underdeveloped / underpopulated / closer to wires heading off to other continents East are part of the value proposition. Which why not handing out an even bigger break (if there is a even bigger boost in property tax increase than the cut.).
 
Sorry if this was pointed out. Some had hit on it, but I couldn't stand reading the ignorant statements any more.
Do you really think NC only giving to Apple without a return. Now I consider politicians idiots, but one thing they know how to do is line their pockets.
Now Apple is getting a tax break, not tax funding, not a tax revocation, but a tax break. Apple will still pay taxes that will benefit NC, but less then they would have before. Think of the way they collect taxes: income, property, business, sales tax on services as well as the sale of the property... So maybe they get a cut on the property (a business would pay a hell of a lot more in property tax than a farm) but the employees pay income tax (I know a drop in the bucket compared to 4.6 million), but governments have ways to get money. All this deals shows is Apple found a place that suits their needs that will allow them to keep more of their money then some other location.

Taxpayers win! NC wins! Apple wins! Those that don't understand how business and taxes work: FAIL!

I cooled down and went back to read the other comments, and it looks like some others see the big picture. One other source of tax that will be huge is the electricity. I think this was one of the advantages, was local and abundant electricity. Maybe those tax breaks were just for the utilities. Also do you realize the taxes placed on telecommunications. Any of these areas could be the source of the tax break. You can be assured Apple will be paying taxes!
 
adammull said:
Why does everyone keep saying my state, dear old NC, is paying Apple $46 million? They aren't paying Apple a dime. They are giving them a tax break of $4.6 million a year. Knowing property taxes in my area, and even more, knowing commercial property taxes on my warehouse that is 100,000 sq plus, Apple will STILL be paying a several million dollar tax bill each year.

You people are idiots. NC threw Apple a bone. We could have either had an empty field, or we give Apple a huge tax break, and it is huge, but still bring in several million a year in taxes, PLUS, the taxes of all 50 employees. Even if NC only nets $1 a year, isn't that dollar better than $0? There is nothing there right now.

Explain your idiotic logic to me again please.
Click to expand...

+1

I don't understand the problem. The tax break is insignificant to a STATE, an entire state that I am sure doesn't need this money. There are a lot of complaints about this tax break but how many people even know about the efficiency of how their tax money is being spent? This tax break just means a few higher ups won't be able to get that fancy vacation or six figure bonus, that's all. Apple has xx Billion in the bank how about NC?

The fact that Apple has xx Billion in the bank has nothing to do with whether or not they deserve a tax break. EVERY company bargains for this kind of thing regardless of what they're worth. It's the american way.
 
clayj said:
A lot of us NC taxpayers are pretty pissed off about this whole thing, actually. Our state has become (in)famous for throwing vast sums of taxpayer dollars at companies like Google and Dell and getting very little in return -- certainly not enough to make up for our "investment". And the jobs at the Maiden facility will almost certainly all be low-paying technician jobs.
Click to expand...

I'd like you to go to all those possible people who might get a job and say, "we could have enticed companies to this state but instead we decided my ego was more important than you getting a job and climbing the ladder of opportunity".

Btw, given how much the federal government taxes - there should be no reason why the states tax so much - and if North Carolina can't make it on its own, then merge with another state and obtain the economies of scale required to make your state a low tax haven for business to setup in.
 
I really wish they'd post tours of these online... so miuch apple porn
 
You must log in or register to reply here.
Register on MacRumors! This sidebar will go away, and you'll see fewer ads.
Top Bottom
Back