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Iowa responds to a delayed project that gives Apple a $ 200 million public grant: “It’s just welfare.”

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Residents outside Des Moines have criticized Apple’s government agreement to give tech giants a $ 200 million public grant for projects that are years behind schedule.

“It’s not fair. They give me nothing. I go there as a citizen and as one, they’re not going to listen to me,” he told Fox News.

Apple reached an agreement with state and local authorities in 2017 to provide technology giants with a $ 213 million public grant in exchange for 50 full-time jobs at a data center to be built in Waukee. ..

A Walkie resident told Fox News, “I don’t think it’s right. Walkie small businesses should take that kind of break, not a giant conglomerate.”

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Apple, which reached a market value of $ 3 trillion in January, was scheduled to open a data center in 2020, according to the company’s first announcement. According to The Des Moines Register, Apple is currently planning to complete the project in 2027.

Brad Deets, Waukee’s Assistant City Administrator, described Apple as “a great corporate partner for our community.” He repeatedly directed Fox News to Apple for specific questions about the agreement.

Apple refuses to comment on how the agreement will help Waukee residents, and the company also refuses to comment on questions related to financial incentives for transactions, the negotiation process, and promises to the city. did.

“We are proud to be part of the Walkie community and are proud of our many contributions to the city, including donating more than $ 5.5 million to local projects like the new Triumph Park. “Apple representative Rachel Wolftary told Fox News. The project has added hundreds of construction jobs and the company hopes to start construction in the coming months.

Apple’s donations were about 2.6% of the subsidies received and promised to donate up to $ 100 million to the city’s public improvement fund.

Apple CEO Tim Cook’s 2021 $ 98.7 million reward package was more than last year’s overall Waukee budget.

Apple CEO Tim Cook
(Getty Images / iStock)

Questions about the agreement

Negotiations on the agreement are still secretly hidden, more than four years after the announcement.

According to The Des Moines Register, the state announced details of the agreement just 90 minutes before the board to approve the plan, and the meeting allocated 10 minutes to public comments.

According to the Des Moines Register, the 2017 agreement will reduce property taxes by 71% over 20 years, worth $ 188 million. The city and state have also agreed to pay for the water and sewerage infrastructure required by the data center.

Deets said he couldn’t provide details of the financial incentives offered to Apple.

“That’s probably a question that needs to be addressed to Apple. Apple was the go-to person in explaining those incentives,” Dietz told Fox News.

Apple refused to answer those questions.

Dave Swenson, an economic research scientist at Iowa State University, called the deal a “political decision.” “”

“It’s just welfare”

“These data centers are subject to special tax incentives, which are not available in other types of businesses, and apply to existing businesses that are already doing business and paying taxes,” Swenson said. Tax incentives that will not be given. “

“It’s just welfare. Walkie would have been okay without it,” one citizen told Fox News.

Residents also criticized the agreement, saying that 50 jobs were not enough to justify the $ 200 million in public subsidies.

“For the 50 people working at the facility … it doesn’t make any sense,” a local hardware store employee told Fox News.

Waukee residents of Heartland Co-Op criticized the agreement.

Waukee residents of Heartland Co-Op criticized the agreement.

Critics and supporters alike point out Iowa’s natural resources and landscape as a major attraction of data centers. Opponents say it is an unnecessary grant with such inherent incentives.

According to state senator Joe Bolkcom, Iowa’s energy costs, land prices, natural climate and lack of earthquakes have contributed to Silicon Valley’s investment in the state.

“We have a natural incentive,” Volkcom told Fox News, calling monetary gains “a free gift for these ultra-rich companies.”

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“Evidence suggests that approximately 70-75% of all public funding spent to incentive businesses was unnecessary and unnecessary,” Swenson said. Did not affect at all. ”

Iowa State University Research Scientist Dave Swenson

Iowa State University Research Scientist Dave Swenson

Swenson also said that corporate subsidies harm public resources.

Apple says, “If you’re not paying fair taxes … then everyone else, that is, if everything is equal, you have to pay more, or others have to be satisfied with less public goods. “He told Fox News.

According to Dietz, the city’s population has grown 75% over the past decade, and Walkie Community School District director Bradback predicts that enrollment in local schools will increase by 24% over the next five years.

According to the latest budget summary, Walkie’s school had a deficit of $ 70 million in 2021 and Iowa had accumulated nearly $ 800 million in debt.

Waukee Assistant City Administrator Brad Deets

Waukee Assistant City Administrator Brad Deets

Deets hopes Apple’s project will attract similar companies.

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“We’re always watching development spawn other developments, and as Apple begins to grow, we’re completely anticipating that there will be other like-minded companies in the city,” he said. I told a local CBS affiliate.

Swenson said the appeal could be a burden to Iowa, calling the subsidy a “permanent offer” that Iowa must meet for future business contracts, with major tech companies at least Apple. The state center suggested that it expects to receive as much public funding as it did to build the data.

“The holes they dug, the masses will never be repaid. This is a pure and pure subsidy,” Swenson said.

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