Tax Break Approved for Saline Township Data Center, But It’s Not What Was Originally Proposed
In a significant development for the residents of Saline Township, near Ann Arbor, a new data center project has received approval for a tax break. However, the approved tax relief is considerably less than what the developers initially requested.
Related Digital, the company behind the project, has embarked on creating a hyperscale AI data center. The project kicked off last month, marking an important milestone in the development of the local tech infrastructure.
Initially, the Saline Township board decided against rezoning farmland for the project, a decision that led Related Digital to file a lawsuit. The company argued that the decision was in violation of the Michigan Constitution’s ban on exclusionary zoning. The law stipulates that local governments cannot entirely prohibit a lawful and economically feasible land use if there is a demonstrated need for it.
Subsequently, a settlement was reached, requiring the township to approve the project in return for a $10 million investment from Related Digital, along with commitments to protect local water resources and establish a decommissioning fund. Furthermore, the township had to endorse the Industrial Facilities Exemption Certificate for the data center, which included the newly approved tax abatement.
During a recent township board meeting, local citizens expressed their opposition to the tax break.
“Billionaires and greedy politicians are never going to be satisfied,” said Saline resident Tim Bruneau. “They will continue to ask for more and more, when they don’t get it, they sue.”
Originally, Oracle, another company involved, sought a 12-year, 50% tax abatement based on a $43 billion valuation of the project. However, the township chose to apply a lower $4.8 billion valuation as per the settlement, resulting in a reduced tax break and more revenue for the township.
An essential aspect of the approval includes a “clawback” provision, which allows authorities to reclaim tax benefits if the project fails to meet specific conditions, such as completing promised site improvements.
Environmental concerns have also been raised, with Kurt Smith, a Berlin Township resident and anti-data center activist, questioning the ecological impact of the project.
“I have to ask what thought — if any — was given to your wildlife in this, and also that’s rhetorical, because I know the answer was none,” Smith said. “Better yet, where’s their tax abatement,” he asked, referring to local fauna. “Unfortunately, we all know that that’s not the way that this works.”
In response, township officials have stated that there are regulations in place designed to minimize environmental impacts.
—
Read More Michigan News
