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How could hyperscale data centers help Minnesota?

America’s networks and data centers enable all that we do online today. Hyperscale data centers create tech jobs, boost the local economy, and support a better online community everywhere.

For a decade, no hypersale data center has located in states that impose sales tax burdens on data center equipment—Minnesota is one of them.

Minnesota has no hyperscale data centers because the state imposes sales tax on servers, equipment, and electricity. That’s a stark contrast to the sales tax exemption that Minnesota has long given to agricultural and manufacturing equipment. Minnesota is missing out on the significant investments, full-time jobs, new state and local tax revenue, and additional economic output that hyperscale data center investments generate.

A sales tax exemption on data center equipment would help Minnesota compete for new hyperscale investments and jobs.

Minnesota can bolster its competitive business climate by joining 30+ other states that provide qualified data centers long-term certainty through a sales tax exemption on data center equipment, and position the state to attract new hyperscale data center investments. Learn more about how a sales tax exemption can bring billions in new investment and high-paying jobs to Minnesota.

An enterprise data center is typically a $750 million dollar investment, larger than smaller co-location data centers. This kind of investment can drive:

  • 1,200 construction jobs
  • $500 million to the local economy during construction

Once built, each site generates

  • 100 direct employees
  • support for 300 additional jobs in security and maintenance
  • almost $200 million dollars in local economic activity once operation begins

Learn more about the potential impact of enterprise data centers on jobs and communities nationwide through a 2017 report by the US Chamber of Commerce here.


Watch a video of Facebook’s newest data center in Henrico, Virginia— about the size of an aircraft carrier here.

Henrico Data Center Virtual Tour

Curious about what’s going on inside the new Henrico Data Center? Check out this video for a virtual tour! Posted by Henrico Data Center on August 6, 2020

An enterprise data center could create almost 20 million dollars in annual revenue for the state and localities due to:

  • Income taxes paid by employees and contractors
  • Corporate income taxes from data center operators & contractors
  • Sales taxes on non-exempt equipment and supplies
  • Lodging taxes for visits by contractors and workers
  • Sales taxes on business services
  • Local real estate & personal property taxes

Read more about that about the potential tax revenue new enterprise data centers could bring through a 2020 report by Mangum Economics here.

Facebook and Google are committed to using renewable energy in their enterprise data centers

  • Sourcing 24/7 carbon-free energy for all data center operations
  • Producing over seven billion kilowatt-hours of electricity from
    • Wind farms
    • Solar photovoltaic energy production
    • Waste conversion into electricity

Enterprise data centers connect to high-capacity networks by building network infrastructure that can be used by schools, colleges, health institutions, and more.

  • In North Carolina and New Mexico, like in other states, Facebook brought high-speed internet to five counties in a new internet fiber route
  • Microsoft’s Airband Initiative brings high-speed internet to rural America, partnering with multiple broadband service companies for the effort