Iowa communities see increased property tax revenue from data centers
Data center development is significantly increasing in Iowa, bringing substantial property tax revenue and job creation to communities like Cedar Rapids and West Des Moines. Municipalities are enacting legislation to regulate this industrial land use, while companies such as QTS, Google, and Microsoft are heavily investing in large-scale facilities across the state. A new data center proposal from Swarm Systems is also being considered in Marshalltown.
The article details a surge in data center development across Iowa, emphasizing the significant economic benefits, particularly increased property tax revenue and job creation, for municipalities like Cedar Rapids and West Des Moines. Many communities are actively enacting legislation to regulate this industrial land use, acknowledging both its advantages and potential impacts.
In Cedar Rapids, QTS is constructing a massive 612-acre, seven-building data center campus, which is projected to consume 1.05 gigawatts of electricity and generate substantial property tax revenue, estimated to reach $55 million annually once tax incentives expire. Mayor Tiffany O’Donnell highlighted the economic boost, including 11,000 construction jobs and a rise in hotel-motel tax revenue. Separately, Google is developing a data center on a 1,000-acre site near the Cedar Rapids Airport, with a commitment to contribute $350,000 per building annually through a community betterment agreement.
West Des Moines has also reaped substantial rewards from Microsoft's $6 billion investment since 2009, which includes five data centers built and a sixth planned across four counties. Ryan Moffatt, Community and Economic Development Director, noted that Microsoft’s presence has enabled the city to lower property tax rates and invest in quality-of-life initiatives, while creating hundreds of full-time jobs. These developments are often supported by infrastructure improvements funded through bonds repaid by the companies' property tax revenue.
Looking to future growth, data center developer Swarm Systems has presented a plan to the Marshalltown City Council to acquire 21 acres for a 150,000-square-foot data center. This trend is bolstered by coalitions like "Growing Iowa’s Economy," which advocate for digital infrastructure investment, emphasizing data centers' role in strengthening the energy grid and creating thousands of construction and permanent jobs across the state.