Microsoft Affirms Plans to Build in Iowa

Microsoft is confirming plans to resume a data center project in West Des Moines, Iowa that was postponed due to the economic downturn. "Microsoft can confirm that we are building a data center in Iowa, but have no further comments at this time," Microsoft spokesperson Monica Drake told the Des Moines Register.

The West Des Moines project was announced in August 2008, but Microsoft never outlined a firm construction timetable. After the economic crisis took hold in the fall of 2008, Microsoft put the project on hold as it said it would reduce its investment in its data center expansion, citing the economic slowdown and the need to cut expenses.

Now Microsoft is back with a smaller budget and sleeker design. The company told the state last week that it was interested in building a $100 million data center in West Des Moines, where the company owns about 40 acres of land.

That’s far smaller than the $500 million data center project Microsoft announced in 2008. But in the ensuing 18 months, Microsoft has refined its data center design to a more lightweight approach that aims to slash its project costs by 50 percent.

Iowa officials are quickly assembling economic incentives to seal the deal. The Register reports that the state signed off on Microsoft's proposal to reduce the size of the project, cutting state tax credits the project could receive from $2.1 million to about $590,000. West Des Moines on Monday agreed to spend $8 million on infrastructure improvements around the project, and today the state Economic Development Board is expected to act on a request from West Des Moines for $2 million to help with up to $10 million in road and utility improvements around the proposed Microsoft project.

The Iowa news follows Microsoft's confirmation of plans to build a new data center on its campus in Quincy, Washington. Microsoft is also said to be scouting potential data center sites in Virginia and North Carolina.