Developers have been investing hundreds of millions of dollars in new data centers in Hammond and Michigan City in recent years.
Hammond Mayor Thomas McDermott Jr. and Michigan City Mayor Angie Nelson Deuitch touted the fiscal and economic benefits of data centers despite the growing controversy at the Michigan City Economic Development Corp.'s Power Breakfast at the Blue Chip Casino in Michigan City.
Data centers have increasingly come under fire from residents in Northwest Indiana who are concerned about massive buildings going up in their neighborhoods, electric usage, impact on utility bills, water use, noise, light, home values and a host of other complaints.
Data centers have been growing more unpopular but bring communities benefits, such as jobs, tax revenue and economic diversification, McDermott said.
"Data centers are super important," he said. "Most of us have a smartphone in our pocket and an iPad or computer at home. This is all connecting to a data center. I wrote part of my speech today with ChatGPT. Let's just say we all got on the same page and said no more data centers in America. It's not going to stop. It's not going to stop other countries from continuing to advance beyond us. It's the American spirit to continue to improve or get better. It's not going to stop. But I hear a steady drumbeat of people saying no more data centers."
Hobart, for instance, has seen a significant pushback against a proposed multibillion-dollar Amazon data center, McDermott said. After the Southlake Mall was reassessed, the city was in dire financial shape and looking at bleak times for decades.
"Mayor Josh Huddlestun completely reversed that. I realize it's controversial. But you have a mayor who did the right thing and secured the city's finances for generations, and may lose his job for that. I hope he doesn't. I think it's insane that we have a mayor who makes a decision despite the public outrage and pulls the trigger because it's right decision for Hobart and for America too because we need to build, build, build and move forward because we need data centers, and if you listen to the naysayers, stop everything right now, no more data centers, my utility bills are too high. That's not the American spirit. Stop building and stop advancing is not the answer."
Huddlestun, reached afterward by phone, said he didn't think the financial piece of the data center issue was discussed enough. The city got $47 million in a direct payment from the data center developer and will get another $10 million when they pull the next building permit and another $45 million when they go vertical, he said. Hobart will get a $43 million payment in 2027, a $40 million payment in 2028 and $50 million in tax revenue every year afterward.
"I appreciate Mayor Tom's comments. We often say we're elected to make hard decisions for the future that the public does not always immediately appreciate. It's what we're elected to do," Huddlestun said. "I appreciate how Mayor Tom has made tough decisions that have benefited his community."
Deuitch said a data center made sense for the long-vacant Federal Mogul windshield wiper in town.
"It's a brownfield," she said. "It's been a brownfield. What else do you want?"
Milwaukee-based Phoenix Investors proposed the $832 million data center that's now under construction.
"I think it's the ideal situation," Deuitch said. "It's just kind of dropped on us and landed on us.”
City officials need to provide better information to make sure the public understands, such as that the tax revenue on the data center property will go from $25,000 to $1 million a year.
“I welcome that opportunity,” she said. “It was one of those things where we had to make the hard decision to do it. But there was really no reason not to do it. I think that’s why Indiana has seen such an uptick in data centers.”
Deuitch pointed to the economic success in Loundoun County in Northern Virginia, where data centers have clustered.
"It's the richest county in America because of data centers. Their homes are all worth $1 million. They don't push back on data centers," she said. "But we're seeing a rise in the anti because I don't think enough good information is going out. We've got to figure that out. Or tell everything to turn the phones off and turn the internet and everything off. We'd be a third-world country."
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