Google gives itself leeway for N.C. data center

Search giant gives itself more scheduling wiggle room for completing a computer facility expansion in North Carolina, forsaking an economic development grant.

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Google headquarters in Mountain View, Calif.
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Updated 12:20 p.m. PST with new comment from Google and the North Carolina Department of Commerce.

As a result of uncertain plans for data center expansion, Google has turned down a $4.7 million economic development grant from North Carolina that would have funded computer facility plans in Lenoir, N.C.

"The company's ramp-up forecasts for its Lenoir project always have been sensitive to a variety of factors that are difficult to accurately predict. Recent volatile economic conditions make business planning even more difficult," Google said in a letter to North Caroline Commerce Secretary James Fain III in which the company withdrew from the grant program.

Google spokesman Eitan Bencuya added that the company didn't want to be tied to a specific timeline or metrics.

Getting the funding through the Job Development and Investment Grant program would have been contingent on meeting specific milestones outlined in the plan, state Commerce Department spokeswoman Kathy Neal said. Although Google withdrew from the JDIG program, "They are still continuing with their investment, initially estimated at $600 million," she said.

Google has been tightening its belt as its days of rapid revenue growth come to an end, and the recession and economic crisis come to the fore.

Google was awarded the grant in 2007 for creating 210 jobs and spending $600 million over four years as a result of the data center in Lenoir, N.C., according to a story in the Triangle Business Journal. But the Internet giant withdrew its application Thursday after establishing one data center building with 50 employees and only the shell of a second, according to the report.

But Bencuya said building the shell and leaving it empty until needed has always been Google's plan. And the company is still building the data center, even if it's giving itself more wiggle room about the schedule.

"This decision does not, in any way, impact the operation of our data center in Lenoir, our commitments to the Caldwell County community, or the jobs of those who are currently employed at the data center," Google said in a statement. "We fully expect to achieve employment and capital investment levels that are consistent with those that the state announced back in 2007."

There are other incentives such as tax breaks for the Google facility, too, according to a report in the News & Observer. Bencuya didn't share specifics, but he said the $4.7 million grant was a minor component of the overall incentives.