State officials say Microsoft is considering Iowa as a location for a new facility and a bill moving quickly through the Iowa Legislature would extend a clump of state tax breaks to Microsoft. Senate Democratic Leader Mike Gronstal of Council Bluffs says one reason Iowa’s in the running is because Iowa-based utilities have built new power plants and have the capacity to keep a huge computer facility running smoothly.
"A stable supply at a stable price of electricity — that’s important to these entities," Gronstal says. House Speaker Pat Murphy, a Democrat from Dubuque, says businesses like Microsoft are looking outside California for expansion because of that state’s overloaded utility system which has led to widespread blackouts.
"We’ve actually passed legislation over the legislation over the past six, seven, eight years that has put us in the position to attract them," Murphy says of Microsoft. A law passed in 2001 made it more attractive for utilities to build power plants here. Murphy says there is also a lot of "dark fiber" in Iowa — high-speed lines for computers which are not being used — something that’s attractive to computer companies like Microsoft.
"We’ve done a number of things that have put us basically in a pretty good position to attract them and they just need a couple of minor twinks," Murphy says. "And we’re going to twink." On Thursday afternoon, the Iowa House approved the bill which forgives sales taxes on computer purchases as well as other incentives for a company like Microsoft pledging to make a capital investment of at least $200 million in Iowa.
House Democratic Leader Kevin McCarthy of Des Moines says it’s "virtually identical" to the incentive package the state extended to Google last year for a Google "server farm" in Council Bluffs. The bill must clear the Iowa Senate and be signed into law by Governor Culver before the incentives intended for Microsoft are in place. Culver says he’s not talked directly with Microsoft executives, but his office has been working behind the scenes to land the deal for Iowa.