Data centers are a huge topic of discussion in our communities across America. This industry wasn't an issue until we started using Claude, ChatGPT, and Gemini, plus the Internet of Things, self-driving cars and trucks, and many other applications. That demand has turned companies like NVIDIA and Advanced Micro Devices into industry giants — NVIDIA now carries a market cap of roughly $5.5 trillion, and AMD's stands at around $830 billion — a scale that reflects just how much the world is leaning on this technology. As usage increases across America, and given the huge military applications this industry must support, it is no wonder data centers are popping up all over the country. Data center controversies are no different from those of many other major industries that have come to America. The public will have to learn the best way to work with this industry. So my purpose for this article is to describe what the tax revenue might look like for a county that has to decide if the investment is worthy, what jobs it creates for a more prosperous region, and what the region is going to look like in the future.
The most recent announcement from FluidStack is that they will not be taking any incentives for this project. What this means is that their direct investment will be taxable at market rates — and that translates into huge tax revenue for the jurisdiction it sits in. For example, let's say for discussion purposes the investment is $30B — how much would a jurisdiction get from an investment of this kind? At a combined property tax rate of roughly 2% — a reasonable average across our RioPlex counties once you stack the county, city, school district, and other taxing entities — that would come to a combined amount of roughly $600M a year, before accounting for the depreciation noted below. Could this money be used for schools, colleges, and infrastructure improvements? You bet. But we have to remember that high technology depreciates fast, so what is invested will lose taxable value quickly — the revenue a county collects each year will track the asset's declining market value, not the original $30B sticker price.
Any new investment requires lots of preparation, and each phase brings its own wave of jobs:
• Site development — surveyors, civil engineers, grading and excavation operators, heavy-equipment mechanics, and utility crews laying water, sewer, and power lines.
• Construction — architects, roofers, AC technicians, electricians, plumbers, masons, and a host of other jobs that AI can't replace.
• Equipment and logistics — freight brokers, truck drivers, warehouse and logistics coordinators, customs and port personnel, and riggers who set the heavy equipment in place.
• Ongoing operations — data center technicians, network engineers, systems administrators, electrical engineers, security, operations managers, and network operations center staff.
These are great jobs that will pay extremely well.
Data centers alone will not change a region, we need other types of investments like those coming to the Port of Brownsville which are Earth shattering and combined these investments will attract related industries to the region that will bring additional jobs and more tax revenues. Think about the Austin metro and why it's so prosperous — not because government is there, but because it has great educational institutions that draw companies like Tesla, Samsung, Apple, and Dell. Tesla's Gigafactory sits in Travis County alongside Austin itself, while Dell's headquarters and Samsung's semiconductor plant anchor neighboring Williamson County — together the two counties show how a strong tech cluster lifts an entire region, not just one city. That's the kind of regional lift our RioPlex area could see.
Data centers are businesses like any other and our community needs to analyze them to ensure they meet the particular requirements of where they will be located. But we need to understand that this industry is all over America, and it has a profound impact wherever it operates. This industry did not start yesterday — we used to call it "the Cloud." Remember? Well, the clouds have arrived, and they don't bring rain — just a lot of drops of prosperity that will awaken the seeds for prosperity for those who make the right decisions.
Editor's Note: The above commentary was penned by Mario Reyna, executive director of RioPlex.
