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Google to possibly expand data center

PORTLAND — Google is eying 23 acres of land for a potential expansion of its large data facility in The Dalles.

A proposal submitted by the company indicates that Google is considering a new facility at the Port of The Dalles, about a mile from its existing data centers, the Oregonian reported. That location would be exempt from most local property taxes under an agreement with the city and Wasco County, said Dalles city manager Nolan Young.

"Although there are a lot of factors to work out before making a final decision, we're excited about exploring the possibility of expanding our operations," said Darcy Nothnagle, Google's head of external affairs for its western region.

Google built its first data center in the Columbia River Gorge town in 2006 and opened a $6 million expansion in April.

Google's existing tax deal required the company to pay $1.2 million in 2013 and $800,000 more annually, starting next year. The new plan would have an up-front payment of $1.7 million and at least $1 million annually.

It requires approval from the city and the county and a go-ahead from Google.

Google would pay an additional $250,000 to the port and pay its employees an average of more than 150 percent of the county's annual wage.

The value of Google's tax savings will depend on the size of its investment.

The expansion proposal comes at a time when server farms are multiplying around the country. Google announced last month that it is planning a data center on the site of a former coal-fired power plant in Alabama.

Oregon's lack of sales tax and lucrative property tax breaks have made it an attractive site for large data centers. Companies can save several million dollars each year because they don't have to pay taxes on the hundreds of millions of dollars' worth of computers that run the server farms.

When a state Supreme Court ruling threatened some of those tax savings last year, Oregon lawmakers voted to reinstate them. The measure had overwhelming bipartisan support, passing 28-2 in the Senate and 52-2 in the House.

Amazon has multiple buildings in Morrow County, and Apple and Facebook both have large server farms in Prineville.

Officials say Amazon and Apple are considering expanding their Oregon sites as well.