Massachusetts lawmakers may be on summer break, but their actions are still making the news, including a project that could be one of Western Massachusetts biggest ever. A $4 billion data center campus is planned for Westfield, made possible by new state tax breaks.
State House News Service reporter Chris Lisinski explains the wide-reaching tax law will help cover costs for everything from electricity use to construction equipment.
Carrie Healy, NEPM: Local leaders say [the project] could deliver thousands of jobs, while environmental advocates are warning the state to tighten protections. Chris, that tax law from 2024, how did it change the game for Westfield?
Chris Lisinski, SHNS: That wide-reaching 2024 law had sales and use tax exemptions for qualified data centers, and that can apply to a whole host of things that will help get this project up off the ground — brakes on taxes for equipment, software, electricity usage, even the construction costs for building the center or renovating facilities.
And the jobs. What's the economic punch here?
Officials behind this project expect that this could generate up to 400 full time jobs for the data center itself, and that it would also support up to 2,000 construction jobs for close to a decade, solely for the work needed to get this up and off the ground.
But why are we talking about Westfield, of all places?
Officials have had their eyes on this because of some of the surrounding infrastructure in Westfield. It's close to an Eversource transmission interconnect. It has a new substation that's going to boost, you know, power reliability for the region and give it some easier access to stuff that's really critical to making a data center work, unsurprisingly. It's also got a roughly close airport. And I think folks are under the impression that the energy costs out in your neck of the woods are going to be pretty attractive compared to, you know, the the denser part of the state here in the East.
Well, there are always two sides to every story, Chris. So what pushback has surfaced so far?
The pushback so far has been primarily on environmental grounds. There's been a lot of hand-wringing lately about the power needed, the water needed to run large data centers. Some folks from groups such as the Conservation Law Foundation want the state to put a little bit more safeguard around this project to force better energy efficiency and decrease some of the resource usage that would come from this.
How soon could shovels actually hit the ground on this?
I think the work could start in about the next six months or so, definitely within the next year, according to one of the key developers working on this. Obviously, the construction timeline could be long given that some of the construction jobs are projected to exist for 8 to 10 years, but this could get going pretty soon.
I want to talk a little bit about the economic development law. It enabled Westfield to be competitive with other states. What makes this so unique?
I think that those tax breaks are really significant. You look at Connecticut, one of our neighbors, for example, they've had a law on the books, I believe, for about four years now with some tax incentives for data centers. But as of last year, I think only one company, Cigna, had taken advantage of that. So what's really interesting here is this law has been on the books for far less time than in Connecticut and already we've got one major project that is on the verge of of tapping into these available credits. Rep. Mike Finn has also pushed for this data center as a way to offset some of the job losses that western Massachusetts has seen in recent years, with groups like Smith & Wesson and Lego either closing up their shops or dramatically reducing their footprint.
So what's the bottom line? Who is being courted to move in?
Service star is the company that is working on building up this data center, and I think that they're courting a lot of really high profile tech shops Microsoft, Google, as we understand it, they have their sights set on, you know, some of the biggest names in this industry.
