LAPORTE — Microsoft plans to invest $1 billion to build and operate a 245,000 square foot data center in the city, a project that Mayor Tom Dermody describes as the largest economic development project in the history of the city. city and which will have a lasting impact on the city. community of approximately 23,000 citizens.
“Wow,” Dermody said of the plan. “Changing our future direction. This is incredible.”
Dermody’s remarks came Monday evening after the LaPorte City Council unanimously approved a 40-year tax exemption for data centers, which would apply strictly to high-tech equipment to be contained inside of the installation.
In exchange, Microsoft will repay up to $2.5 million, or about 30 percent, of its tax savings per year over the life of the deal. These funds will be split between the city’s redevelopment commission and the LaPorte Community School Corp.
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“This is huge for the city of LaPorte. The jobs will all be quality and well-paying, which we can’t get enough of,” said Councilman Tim Franke.
Microsoft’s plan was publicly announced Tuesday morning by Governor Eric Holcomb. A press release from the governor’s office says the data center will create up to 200 new jobs by the end of 2032 and “accelerate cloud computing infrastructure to support the growth of technology and artificial intelligence in the whole world “.
Microsoft officials said the company will build at least one 245,000-square-foot facility on Boyd Boulevard, just east of U.S. 35 on the far south side of LaPorte. The data center will span nearly 500 acres of former farmland purchased by Microsoft in two separate transactions, one in 2023 and one earlier this year, after the property was annexed to the city at the request of the former owners, who had expressed the wish. for the land to be redeveloped, said Bert Cook, executive director of the LaPorte Economic Advancement Partnership.
The site is now known as Radius Industrial Park.
Unlike tax abatements, which waive a percentage of property taxes typically over a 10-year period, no property taxes will be imposed on data center equipment at any time during the term of the exemption, Cook said.
The exemption was made possible by a law intended to attract data centers and other high-tech companies to the state. State Rep. Jim Pressel, R-Rolling Prairie, said he helped write the tax exemption legislation signed by the governor about three years ago.
“Since we adopted this standard, Indiana has become the data hub of the nation. It works very well,” Pressel said.
Cook said property taxes, however, will be assessed in full on the value of the building and land.
He said Microsoft’s arrival furthers progress toward a more modern era that the city has been actively striving toward since Dermody became mayor in 2020.
Cook believes other businesses and residents will be attracted to LaPorte simply by the presence of a world-renowned company like Microsoft.
“It really indicates that LaPorte is a growing community and it’s a place where people want to be.” For any other businesses or residents looking for a community to locate to, they should look in LaPorte and we’re excited about that,” Cook said.
The deal in LaPorte comes after Microsoft purchased more than 900 acres of farmland in Granger on May 23 to position itself for possible construction of a data center in St. Joseph County. The land acquisition occurred after St. Joseph County Council rezoned the property for industrial use.
Cook said the construction timeline at LaPorte will become clearer as plans get closer to completing the standard approval process.
“We will see construction work in the very short term. It’s not something that’s going to happen in 10 years,” Cook said.
In addition to the incentive agreement with LaPorte, Microsoft will benefit from state grants accepted by the Indiana Economic Development Corp. It also entered into an agreement with NIPSCO regarding its electricity needs.
IEDC has committed to providing a 35-year data center sales tax credit for a minimum of $1 billion in eligible capital investment, the governor’s office said. For every $1 billion in eligible investment made at the site over the first 15 years, the company will be eligible for tax exemptions for an additional five to 10 years, up to a total duration of 45 years.
The state’s announcement of the Microsoft project says it is the fourth major data center project announced in Indiana in 2024, with the others in Fort Wayne, New Carlisle and Jeffersonville. These projects are planned by Google, Amazon Web Services and Meta respectively.
“Indiana is committed to becoming a hub of the global economy of the future, and this latest announcement ensures that Hoosier communities and talent will be key to widespread advancements in cloud and artificial intelligence technology “Holcomb said in a prepared statement. “As a state, we have created a pro-growth business climate and implemented a forward-looking framework to attract major investments in high-tech and high-growth sectors. We are thrilled to welcome Microsoft’s new data center to Indiana and look forward to the incredible value-added impact this will have on our statewide data-driven ecosystem, as well as new career opportunities, especially in the Northwest Indiana community.
Microsoft, based in Redmond, Washington, said it will employ critical environment engineers, IT technicians and managers, inventory and asset technicians and managers, security personnel and from site managers to the data center.
“Microsoft is excited to expand our data center infrastructure in Indiana, with the construction of our first campus in LaPorte,” said Bowen Wallace, Microsoft CVP Datacenters, Americas region, in the state announcement. . “We appreciate the collaboration with the state, the city and the LaPorte Economic Advancement Partnership that made this opportunity possible. We look forward to building a lasting and beneficial relationship with Indiana and the City of LaPorte as we build and evolve our data center infrastructure to support our customers and partners.