Microsoft goes quiet after church groups ask for 1% of data center costs

Microsoft has spent all year telling communities that when it brings a new data center into their area, it is committed to being a “good neighbor.” It will pay local property taxes that support local hospitals, schools, parks, and libraries, and it will invest in “vital services the community cares about,” the company promised. And it has sent liaisons into those communities to learn what those needs are.

But ask those liaisons how much the company is willing to invest, and the answers can be hard to come by.

At community meetings, Microsoft representatives have seemed unprepared to answer questions that go beyond the company’s “good neighbor” campaign materials, Ars has learned. The company has acknowledged in public-facing documents that simply matching its employees’ charitable donations—which totaled $229 million across 29,000 nonprofits in 2024—isn’t enough. But it has been vague about what more substantial local investments might look like. And to critics, Microsoft’s local investments seem especially small compared with the estimated hundreds of millions in state-level tax breaks that data center developers get in 38 states—exemptions that often last more than a decade.

In Georgia, a recent audit found that the state “gave up $474 million in sales taxes in one year—and got back just $41 million from the industry,” journalist Ronan Farrow reported. Why Georgia is willing to give away so much in tax breaks is unclear, Farrow noted, since “by the state’s own estimate, 70 percent of the data center construction would have happened anyway.”

Some communities are starting to question that logic. In Indiana, for example, big firms like Microsoft can buy data center equipment without paying the state’s 7 percent sales tax. The exemption could apply to as much as $13.2 billion in projected equipment purchases. Without the exemption, up to $900 million could have been added to the tax base supporting state programs, Indy Mirror estimated. And the exemption can last for 50 years, which has some residents wondering how much their communities are giving up to attract data centers.