Elon Musk’s social media firm X has been granted a tax break to keep data center hardware in Atlanta, Georgia, after threatening to relocate to Portland, Oregon.
As reported by GovTech, the company was granted a $10.1 million tax break on the installation of new AI hardware at its data center environment in a QTS facility in Atlanta.
The Development Authority of Fulton County this week voted 6-2 in favor of granting the 10-year tax break on a $700 million project to deploy IT equipment at QTS’ 1025 Jefferson Street site.
The social network firm formerly known as Twitter said the computer infrastructure would be used to develop and train artificial intelligence products for the X Platform, including large language models and semantic search.
X purchased 10,000 GPUs for an artificial intelligence project in April 2023. The company was previously denied the tax break in December. The board deadlocked on a 4-4 vote (with one absentee) on the request, leading to another vote this month.
The company had previously said the savings were needed to prevent X from choosing to install the equipment in its other data center in Portland, Oregon – but during the December meeting, it admitted the desire to deploy quickly meant some infrastructure would be installed at the facility regardless of the incentive.
In this month’s meeting, Dhruv Batura, the X project lead, admitted all but $200 million of equipment has already been shipped to the Atlanta data center, but noted the company would move the remaining equipment to Portland if the incentives fell through.
“We’re going to free up space in Oregon because the cost of operating in Atlanta without the abatement is about 21 percent more,” Batura said. With the tax break, he said it would fall in line “to the cent” with Oregon, which has already provided tax breaks.
X acknowledged the project would not result in any new jobs, but merely safeguard 24 existing X jobs. The deal would reportedly generate more than $16 million in new tax revenues over the next decade.
The most recent bond sheet suggested the project would also see the “utilization” of 50 additional employees across four vendors for the fit-out of the data center room as well as logistical and handling services of infrastructure.
X moved into the QTS facility sometime around 2014, reportedly leasing some 80,000 sq ft. The company previously moved into QTS’ neighboring 1033 Jefferson Street sometime around 2011, leasing more than 150,000 sq ft over the years.
Since acquiring Twitter in April 2022, the renamed X company has seen a large overhaul of its infrastructure.
Reports that the company was exiting one of its Sacramento facilities in California surfaced in December 2022, alongside plans to downsize the data center in Atlanta, Georgia. In June 2023, Elon Musk's Tesla signed a lease on the NTT-owned data center vacated by X. The company also left another Prime-owned facility in Sacramento last year.
The company said it had “freed up 48MW of capacity and tore down 60,000lbs of network ladder rack before re-provisioning it to other data centers" since the shutdown.
X had also been accused of not paying bills due to cloud providers – including Google, Oracle, and Amazon – in an attempt to renegotiate its contracts. During the period of Musk's acquisition and the months that followed, Twitter experienced a series of outages.