STAFFORD — Stafford County officials said Prince William County is the regional model for tax rates for data centers.
So, they adopted new tax rates to mirror them. And now they hope to eat Prince William County’s lunch.
“We now speaking with data center operators and many have become spooked by what happened in Prince William, and are looking to bypass the county, so we’re trying to open our arms and welcome them here,” said Stafford County Commissioner of the Revenue Scott Mayausky.
Data center companies, apparently, were “spooked” when, last year, Prince William County Board of Supervisors Chairman At-large Corey Stewart threatened to hike the county’s “computer and peripherals” tax paid by data centers. The threat came after years of county-led efforts to lure data centers to Prince William.
While it didn’t happen, Stewart argued that increasing the tax rate would bring Prince William’s more in line with neighboring Loudoun County — a data center mecca — and would generate more money for schools.
Data centers are big business in Prince William. County tax revenues from data centers grew 182 percent from $2.4 million in 2010 to $6.6 million in 2017, according to a report from the Northern Virginia Technology Council.
And new data centers continue to open there, too. Data giant Iron Mountain opened a large campus near Gainesville in 2017, and work is now underway for a new Cloud HQ data center to be located near the Manassas Regional Airport.
Hoping they’ll be a big business there, too, the Stafford County Board of Supervisors adopted the same tax rate Prince William County uses to tax data centers. Those centers are large buildings full of computer equipment that facilitate businesses on the internet.
Data center firms frequently upgrade their equipment and technology improves, and that gear will now be taxed at the following rates, on this depreciation schedule:
- Year 1 63 cents on the dollar
- Year 2: 44 cents
- Year 3: 25 cents
- Year 4: 13 cents
- Year 5: 6 cents
Stafford County Economic Development Director John Holden said that, along with Stafford, other jurisdictions in the Fredericksburg region will also adopt the same tax rates and depreciation schedule, and work together to lure new data centers.
“With these new tax rates, we believe we will compete to attract data centers,” said Holden.
Prior to the tax change, data centers paid the computer and peripherals tax rate of $1.92.
Today, only one data center operates in the county. Holden told Potomac Local the county plans to market the Centerport Parkway area of the county near Stafford Regional Airport as prime real estate for data centers, and that his team is working on an overall marketing plan.
There are more data centers in Northern Virginia than anywhere in the world. The region is now facing competition, however, from areas inside the state like Henrico County near Richmond, and Chesapeake in Hampton Roads, said Northern Virginia Technology Council spokesman Josh Levi.
