JPMorgan data center tax breaks spark debate in Rockland County
Critics question $77 million in projected tax breaks tied to a project reported to create one permanent job, while officials say the benefits go far beyond that number.
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We use our phones for everything — apps, streaming, shopping and increasingly artificial intelligence. But behind that convenience are massive data centers that require land, infrastructure and enormous amounts of power.
Now, one of those facilities in Rockland County is at the center of a growing debate over tax breaks, jobs and energy use.
A new JPMorgan data center expansion in Orangeburg is drawing scrutiny over millions in tax incentives — with much of the controversy centered on one number: a single permanent job.
The project, located at 140 Old Orangeburg Road, involves a second building on an existing JPMorgan campus on the former Rockland County Psychiatric Center property. The Rockland County Industrial Development Agency approved roughly $77 million in projected sales tax exemptions tied to construction materials, equipment and other costs connected to the project.
Critics, including state Sen. James Skoufis, argue taxpayers should be alarmed by a subsidy package tied to a project reported to create just one permanent position. Speaking on the Senate floor this week during debate on a utility infrastructure bill, Skoufis said data centers are expanding across New York while placing new demands on the electric grid.
“Data centers are cropping up throughout New York State and they pose a severe challenge,” Skoufis said.
He then pointed to the Rockland project directly.
“For what? To support, to promote a data center that creates one single job,” Skoufis said.
Skoufis also called it the largest per-job subsidy not only in New York state history, but in the nation’s history. He said his broader concern is how industrial development agencies operate statewide and whether taxpayers are getting enough in return.
But Rockland County IDA officials strongly dispute the idea that the project should be judged by one permanent job alone.
Rockland County IDA CEO Steven Porath told News 12 the figure does not reflect temporary construction jobs, installation work, tax revenue, site cleanup or the economic impact of the larger campus.
“I’ve gotten multiple phone calls from residents. People have asked us, what are you doing?” Porath said.
Porath said the agency’s analysis projects more than 1,400 temporary construction and installation jobs over the next decade. He also said the site had previously been a burden to the community, with deteriorating asbestos-filled buildings that generated no tax revenue.
“Literally the site those data centers are on were filled with asbestos-filled decaying buildings,” Porath said.
Porath said data centers there have generated more than $11 million in property taxes over the last five years.
JPMorgan says the campus has already operated there for years and currently employs more than 70 people at that location, with more than 240 employees working in Rockland County overall. The company says the expansion project alone is expected to create about 150 local construction jobs, in addition to hundreds of other construction jobs tied to remediation and development of the site over several years.
Some nearby residents say they are less concerned about the presence of the data center itself than the possible long-term impact on electric demand.
Orangeburg resident Nilza Lopez told News 12 the facilities have not been disruptive, but she has questions about future growth. “It takes a lot of energy. I hope the grid is ready for it,” Lopez said.
Orange and Rockland Utilities told News 12 it is reviewing the expansion’s impact on the grid while working to protect customers from undue cost burdens. The utility said existing rules and review processes are designed to balance the needs of large energy users while avoiding unreasonable costs for other ratepayers.
News 12 also reached out to the Town of Orangetown for more on its review of the project, including any possible environmental impacts, and is awaiting a response.
The debate comes as data centers face increasing scrutiny nationwide over tax incentives, land use and the large amounts of electricity needed to power growing demand for cloud computing and artificial intelligence.
