As the largest development deal in state history moves forward, St. Joseph County leaders are beginning to discuss what amount of tax abatements to award Amazon as it starts to build its campus of data centers near New Carlisle.
On Tuesday, the county council looked at a preliminary proposal that will see the tech giant get a 50% abatement on property taxes for 10 years as part of a larger framework for other tax incentives.
What that 50% property tax break means in terms of total revenue for the county is more complex since it depends on how many individual data center “shells” Amazon builds. The county’s director of economic development Bill Schalliol explained Amazon Data Services isn't planning a singular center but rather a series of shells, each of which will be approximately 219,000 square feet.
Schalliol said Amazon eventually wants to build 16 shells. Each shell will generate $2.3 million worth of taxes per year, which would round to $1.15 million with the 50% abatement.
When the shells get built is to be determined. Nine of the shells will go on 640 acres of land due east of the Navistar Proving Ground and seven will go on land southwest of the Edison and Larrison intersection.
As it stands, the 50% property tax abatement is smaller than what other companies request. At the same meeting as the Amazon breaks were discussed, council members reviewed tax abatements for Lippert Components, who is looking to operate a $40 million warehouse near Old Cleveland Road. Lippert's request is a sliding scale where the company would get a 100% abatement in Year 1 down to a 55% abatement in Year 10.
In addition to the property taxes, Amazon is also seeking tax exemptions for computing equipment — possibly an 85% exemption for 35 years. Those tax credits need to be handled in a separate agreement since state law has special carve outs for large tech companies that allow them to write off computing equipment.
The abatements still need to go through multiple levels of approval, with final votes likely coming this summer. Amazon will also receive a variety of incentives from the state.
