The developers of the first Stargate data center in Abilene, Texas were able to obtain 85% tax violations on billions of dollars worth of property, according to a new tax reduction agreement obtained by Business Insider through public records requests.
To qualify for the tax credit, AI startup Crusoe must spend at least $2.4 billion of its $3.5 billion “covered investments.”
President Donald Trump announced Stargate, a joint venture between Open, Oracle and SoftBank. That month, Business Insider reported that Oracle was a tenant of two data center buildings under construction at Abilene’s Crusoe data center campus. The estimated costs ($1.1 billion) for these buildings are counted in target investments.
Since then, Crusoe has registered two more data center buildings with state agencies on the site. One of those buildings does not have a list of tenants. Oracle is listed as the other tenant.
Crusoe has agreed to build six new data centres on Abilene’s Lancium land. These will take part in two that are already built for Oracle.
Data centers generate jobs. However, some people say it’s not enough
The local news outlet first reported the mitigation after Abilene City Council approved it in February and named the site’s landowner Ranchium as the recipient of the tax credit.
The exclusion batement requires Crusoe and Ranchi to create 357 new full-time jobs with a minimum salary of $57,600. The employment time frame indicates that construction jobs are likely to count towards quotas, but it does not specify what kind of jobs should be created.
Critics of data center tax cuts say it doesn’t create enough jobs to justify the tax credit. Advocates want to point out that the site can employ thousands of skilled workers during the construction period.
A reduction in property taxes is a common financial incentive used by local governments to encourage businesses to operate in cities and towns. Specific property tax credits for data centers vary widely from region to region. Loudoun County, Virginia, is home to the world’s largest data center and does not reduce the property taxes on the data center. The fast-growing data center, New Albany, Ohio, grants data centers a 100% property tax relief.
Stargate expansion plan
Oracle’s executive chairman and CTO Larry Ellison said the first Stargate data center is in Abilene, but details have been revealed about the massive AI infrastructure initiative since Trump’s announcement.
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In February, Openai CFO Sarah Friar wrote in a LinkedIn post that the company is evaluating additional locations for Stargates in Texas, Pennsylvania, Oregon and Wisconsin.
Crusoe has not publicly confirmed that it is connected to Stargate, but has announced that it will develop a data center campus in Abilene. The Texas public application indicates Oracle is a Crusoe tenant, Business Insider reported in January.
To fund Abilene development, Crusoe has acquired a $3.4 billion joint venture with private credit company Blue Owl. JPMorgan lent the project $2.3 billion in construction funds.
Ranchi declined to comment. Crusoe, Oracle, and Development Corporation of Abilene did not respond to requests for comment from BI.
Contact Ellen Thomas at Ethomas@insider.com or Signal at 929-524-6964.
