Saline Township Approves Tax Break for Data Center Project
Saline Township, located near Ann Arbor, has given the green light to a significant data center project by approving a tax break. The development, led by Related Digital, involves the creation of a hyperscale AI data center, with construction already underway since last month.
Initially, the Saline Township board rejected the rezoning of farmland for the data center project. However, after a legal dispute with Related Digital over exclusionary zoning practices, a settlement was reached. The township agreed to permit the project in exchange for a commitment from Related Digital to invest $10 million in the community, safeguard local water resources, and establish a decommissioning fund.
As part of the agreement, Saline Township also had to approve the data center’s Industrial Facilities Exemption Certificate, which includes the tax abatement endorsed at a recent meeting.
Despite some opposition from residents who voiced concerns about the tax break, the township opted for a more conservative approach. Oracle, which was involved in the project, had initially requested a 12-year, 50% tax abatement based on a $43 billion valuation. However, the township used a lower $4.8 billion valuation from the settlement, resulting in a smaller tax break that ensures more revenue for the township.
In addition, the board included a “clawback” provision in the agreement, allowing authorities to reclaim tax breaks if specific conditions are not met, such as the failure to fulfill promised site improvements.
Environmental worries were also raised by residents, with concerns about the impact of the data center. Township officials assured that regulations are in place to address and mitigate any potential environmental effects of the project.
