Data center tax break bill dies in House

OLYMPIA - A bill extending a temporary tax break for data centers' replacement servers died in the House during the final week of the Legislature's special session.

The bill passed the Senate and was needing House approval before being signed into law.

It would have given data centers until April 1, 2021, to take advantage of the sales tax exemption. The original deadline was July 1, 2010.

The bill came out of the House Ways and Means Committee with a 26-0 vote, said Pat Boss, the Port of Quincy's government affairs director, on Friday.

The proposed legislation didn't advance, as House leadership apparently decided they didn't want it to come up for a vote, he said.

Boss clarified the decision wasn't made by local leadership.

House leadership members are generally Seattle-area legislators, he added.

Many believed the bill would have passed had it came up for a vote, Boss commented.

There were two other major tax incentive bills that did not pass during the Special Session.

One bill would have provided a tax credit incentive to bring more movie projects to Washington state, he said.

Another bill would have given newspapers an extension for "a preferential business tax rate," according to a Friday Tacoma News Tribune article.

In the article, House Majority Leader Pat Sullivan, D-Covington, was quoted as saying "it was difficult then, in turn, to turn around to adopt a tax break," after passing a budget that didn't fund some programs members wanted.

Labor advocates testified in favor of the data center extension earlier this year, saying the data center projects were creating jobs, Boss said.

During a past interview with the Columbia Basin Herald, Dave Johnson, executive secretary of the Washington State Building and Construction Trades Council, said more than 200,000 work hours were put into data center projects because of the original bill.

"Our understanding is, there's other major data facilities that would like to move into the area if the tax exemption were extended," Johnson said.

Johnson was unavailable for further comment by deadline.

Port of Quincy officials were closely watching the bill because five data center companies either started construction or expansions in Grant County this past year.

In Quincy, Yahoo! and Microsoft expanded and Dell and Sabey broke ground.

In Moses Lake, work to complete a co-location data center is underway at the Titan Data Center on Patton Boulevard.

"I think Moses Lake, Quincy and Ephrata, clearly would have gained tremendously, by having that bill pass," Boss said. "There's a lot more interest lately in Moses Lake and Ephrata. Unfortunately, we may not realize the full extent of what the interest was."

Note: The print edition of this article incorrectly stated the committee's vote tally. The correct tally was 26-0, not 41-1. The 41-1 vote was the  Senate’s vote on the bill. The online edition has been corrected to reflect that.