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Texas Governor Greg Abbott seeks tax subsidies for Facebook to build new data center in the state

Some are seeing a conflict with Abbott's public suggestion he wants to rein in Big Tech.
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Texas Gov. Greg Abbott is an outspoken critic of Facebook for its censorship. However, a new report revealed that the governor’s office has been silently negotiating with the company regarding a new data center in the state.

Last month, while unveiling a new state legislation that would make it illegal for social media companies to censor content based on viewpoint, the governor singled out Facebook, saying its actions were “un-American and un-Texan.”

“The First Amendment is under assault by these social media companies, and that will not be tolerated in Texas,” Abbott said at the time. “What Facebook and Twitter are doing: they are controlling the flow of information — and sometimes denying the flow of information. Texas is taking a stand against Big Tech political censorship. We’re not going to allow it in the Lone Star State.”

But Abbott doesn’t hate Facebook and actually wants the Big Tech giant to expand in the state. According to documents obtained by The Texas Tribune, the governor’s office is negotiating with Facebook about the tech company’s plan to build a new data center in Texas. The documents were provided by the nonprofit watchdog group Campaign for Accountability’s research arm Tech Transparency Project.

Earlier this year, the Tech Transparency Group filed for an open records request of communications between the Texas governor’s office and tech companies. However, the communications with Facebook were not released, because the records would expose confidential information related to Texas silent courting of Facebook.

Still, the Tech Transparency Project was able to obtain a letter by one of Facebook’s lawyers, which revealed the details of the negotiations between the state and the social media company. In the letter, the lawyer argues that the communications records would not be released because they would reveal:

  • Facebook was considering a second data center in Texas
  • The name of the data center
  • The name of the subsidiary that would buy the land for the data center
  • Facebook employee’s names working on the project
  • And, a non-disclosure agreement between Facebook and the governor’s office

The letter also revealed the negotiations have been going on since August 2020. It argued that not releasing the information was “paramount to the ability of the State of Texas to remain in consideration” of the project.

Some may argue that a new data center in the state is not a bad idea as it would help the local economy and create jobs. However, according to the Tech Transparency Project’s director, Katie Paul, it is “entirely likely” that the project would “end up being a raw deal for Texas taxpayers” who, considering Facebook’s recent (and not so recent) behavior, may not feel comfortable subsidizing the Big Tech giant to expand.

“A similar data center in Tennessee granted Facebook $19.5 million in tax incentives for a project that would only create 100 new jobs,” Paul said. “If Facebook throws its weight around in Texas in the same way it did in Tennessee, it’s no wonder that both the company and the governor’s office are trying to keep their negotiations under wraps.”

The existing Facebook data center in Texas, which currently has only 150 employees, is in the city of Fort Worth. The deal between the city and Facebook came with a 20-year tax incentive worth $147 million.

At the time, Abbott boasted about his efforts to bring Facebook to Texas, adding that the facility would result in an “even more robust and diverse economy.”

“Make no mistake, this project does far more than just create jobs and add capital to the region,” Abbott said. “It is a magnet that high-tech companies are welcome to the state.”

There are several other large tech corporations with a presence in Texas, including Oracle (which is set to shift its headquarters from Silicon Valley to Austin) as well as Dell, Amazon, Tesla, Apple, and Amazon.

Abbott has been encouraging tech companies to move to the “Silicon Hills” of Texas as they are more business friendly than California’s overpriced Silicon Valley.

Meanwhile, the bill Abbot announced last month passed in the state Senate by 18 votes to 13. Once it becomes law, Facebook and other big social media companies would be vulnerable to lawsuits and fines by the state attorney general if they censor, ban, block, demonetize an account or user based in Texas for their legal speech – that’s assuming that it doesn’t get challenged constitutionally (though it likely will).

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