PARKER, Colo. — Douglas County commissioners unanimously approved a tax rebate — business personal property tax (BPPT) rebate — worth an estimated $19 million over 35 years for a Parker data center expected to create 16 jobs, despite objections from residents who questioned whether the incentive is justified.
Denver7 previously covered the story back in June, as some residents expressed their concern over the facility.
"I just want to make sure the city and my county will not disadvantage the homeowner," said Parker resident Falgun Pathak, who lives near the Flexential facility.
Denver7's Douglas County Reporter Tyler Melito attended Tuesday's commissioner meeting, where Commissioner Kevin Van Winkle moved the topic off the consent agenda and onto the regular agenda to allow for both commissioner and public comment.
All three commissioners, including Douglas County Commissioner Abe Laydon, expressed their dislike for the BPPT and how they believe it hurts Colorado.
"I have never been a fan of the business personal property tax," Laydon said while attending the meeting virtually. "It's a property tax on things that just don't make a whole lot of sense, and it impedes business. And we have always had the practice of when a particular entity reaches out to us for a waiver of business personal property tax, that we do so."
The rebate, as defined by the state of Colorado, is a tax on a business's equipment. In the case of Flexential, this would include their machinery and computers. This would not include the tax on the property a business is on.
"What it is, it's not property taxes like the traditional property taxes; the company will still be paying 100% of their property taxes," Van Winkle said. "It's when a company buys a product, even buys a chair or anything, that they pay sales taxes on that. That sales tax goes into the local government, Parker, the county, etc. But then every year after, forever, as long as that thing holds value, they are taxed again and again and again and again."
Now that the rebate has been approved, while Flexential won't pay a BPPT to Douglas County, it will still go to the town of Parker and to Douglas County Schools.
All told, the rebate lasts 35 years and will cover an estimated $19 million.
► Watch Tyler Melito's report in the video below:
Douglas County Commissioner George Teal said any business that applies for this rebate will be approved.
"My opinion is any business that comes in asking for a credit, 100% credit on business personal property tax, we will start the paperwork that day, and I am going to vote for it eventually," Teal detailed. "It might take some time to go through the process. I don't care how big. I don't care how small. If they're a business in Douglas County, they will get that credit."
Members of the public at the meeting had the opportunity to share their opinions on the tax.
"I oppose this, I really do oppose the business personal tax, but the problem is, you're charging everybody else in this county the same thing," said Doug Chestnut. "They make plenty of money, and I'm not against that. But we shouldn't be subsidizing it. So please, I respectfully ask you to vote against this."
Gail McDonnell of Castle Rock shared concerns about water, electricity, and noise, among other issues with the facility.
"Douglas County Commissioners want us to give away money to a large corporation, a billion-dollar corporation, for the next 35 years; our electric bills and water bills will increase tremendously," McDonnell said. "The residents near the center will have to endure increased noise, heat, and lights from the center. You can call the police on barking dogs or loud parties, but you can't on the data center. Property values will decrease, health issues will increase."
Joe Lugo of Parker was unable to attend the meeting Tuesday, but spoke to Melito beforehand about his concerns with the rebate and the center.
Lugo told Melito that he agrees that the BPPT isn't the greatest.
"My personal opinion is I don't like this extra tax just because I feel like, you know, it is a double tax on certain things, especially for small businesses," Lugo said.
But in this instance, it should apply to Flexential, citing concern over what Flexential is bringing to Parker.
"This corporation is getting 19 million for providing 16 jobs," Lugo said. "So the math just doesn't add up. It just doesn't make sense. It's my understanding that we've given large corporations like this, such as Kroger, tax breaks, which is totally understandable based on the number of jobs it created. I know Kroger got something around $3 million for providing 250 jobs for the King Soopers, fantastic."
Lugo added that he had many questions he would've liked to ask the commissioners.
"Why is this 35 years? These commissioners are elected to, you know, terms that will not last 35 years, so why isn't it 10 years? Why isn't it five years? Why is this going to affect my children when they're, you know, close to my age?" Lugo asked.
Melito reached out to Flexential to confirm whether the facility would create 16 new jobs in Parker, and they confirmed that fact.
Jack Faunce, VP of Procurement at Flexential, was in attendance at Tuesday's meeting on behalf of the company.
He answered concerns over water, electricity and noise.
Regarding water, Faunce said most of the water will be for bathrooms, employee break areas and landscaping, not for the machinery.
"It is a closed-loop water system; it's expected that that data center will use less than 600,000 gallons of water a year, which the average Colorado family of four uses 125,000 gallons a year, so it's less than, well, it's five to six families of four for Colorado," Faunce explained.
When it comes to electric, Faunce shared they have a partnership in place with CORE.
"We are located next to the transmission station we are pulling from, so we have written them a check already, and we are paying for all the work to upgrade the system for what's needed, and also to bring the lines to our location, and then we are going to pay the full rate for all the utility we use," Faunce said.
And regarding noise, Faunce explained their facility won't be much louder than traffic.
"Our studies show that we will be at 65 decibels when the generators are not running, which is less than city traffic," Faunce outlined. "If you look at a decibel table, the generators we use provide backup power to guarantee our customers power. So if there were an issue with core where power was not available, we would run generators. Those generators would be at 80 decibel levels at 25 feet from the property."
The data center was approved through the town of Parker. Melito reached out to the town for comment, specifically on getting an answer to why the town believes data centers are best for the community, as other places put in moratoriums. They referred him to their FAQ page.
