Michigan City has approved incentives for a planned data center development. Phoenix Investors plans to repurpose the vacant Federal Mogul property on Royal Road into a data center campus.
The city council Tuesday approved a series of property tax abatement resolutions, reducing taxes on real property by 50 percent for 10 years. In exchange, the company promises to create 30 full-time jobs and pay more than $26 million in “economic development incentive payments” over the next 40 years.
"We’re able to adaptively reuse an existing or former industrial plant," said John Peret with Phoenix Investors. "We’re adjacent to utility-scale infrastructure. It’s disaster-safe, and it’s a very business-friendly and pro-development climate here."
He promised that the facility would use a relatively small amount of water, and the cost of any necessary power upgrades would be paid by the still-to-be-named end user. “What I can state at this moment about the end user is it’s not Elon Musk, but it is a U.S.-based, global 50 company in the data center world,” Peret said during Tuesday's meeting.
But the project is drawing concerns from residents, environmental advocates and some council members. Some worry about the impact on area schools and other learning facilities.
Just Transition Northwest Indiana Executive Director Ashley Williams asked council members to slow down the approval process. "Where are our tax breaks?" Williams asked council members. "Why are we subsidizing billionaire tech corporations when folks are struggling every single day to meet their basic needs?"
But council member Bryant Dabney felt the benefits outweighed the risks. "These are the facts: we are looking at budget shortfalls that are happening right now," Dabney said. "The state is doing the things with putting property tax caps and things like that on us, and we are looking at, like I said, budget shortfalls."
He warned that Michigan City may have to cut amenities and services, without new revenue. Attempts to table the resolutions failed by a vote of five-to-four.
