Virginia Environmental Regulators recently fined Microsoft $2.4 million for violating air permit pollution levels at a data center in Northern Virginia. This comes at a time when a majority of Americans say they would feel skeptical of a data center in their community, according to the Pew Research Center.
But there are strong supporters who argue the high paying jobs and tax revenue can be a game changer for some communities.
Tobacco was once a major industry in Mecklenburg County, and a few leafy tobacco fields are still growing along the highway on the way to a large grey building in Boydton —Microsoft’s first hyperscale data center in this community.
“We started building this, made the announcement, stuck a shovel in the ground, way back in August of 2010,” described Jeremy Satterfield, who works for Microsoft and grew up in neighboring Halifax County. This part of Virginia is very rural and borders North Carolina.
Virginia paid Microsoft millions of dollars in grant incentives to build here. The company also got money through the Virginia Tobacco Region Revitalization Commission, a fund that was created out of a major settlement with the Tobacco industry in 1998.
Today, there are nine data center campuses operating in Mecklenburg County, and more are in the works. They employ hundreds of people and pay salaries higher than most other jobs in the area, said county administrator Alex Gottschalk.
“There is almost no other industry that we would have access to that provides the level of opportunity that the data center industry does,” Gottschalk said.
Microsoft is Mecklenburg’s number two employer, with at least 800 workers. These numbers may not be as impactful in communities with lots of other employment opportunities.
“Nobody was coming here. Nobody was interested in Mecklenburg County,” Gottschalk said. “We had no employment opportunities on sites that we set out for 20 years.”
But not everyone is on board with more data centers. Residents and environmental groups recently organized a series of protests across Southern Virginia, asking for a temporary moratorium against new data centers.
Gottschalk acknowledged data centers do come with some challenges, including increasing demand for more electricity.
“There is nothing that is perfect. Ok?” Gottschalk said. “People have to make very critical decisions about a lot of different factors.”
As for water use, Gottschalk said the county has enough to supply to data centers. Last year, data centers consumed about 18 percent of the local utility’s water supply, according to reporting by WRAL news.
Gottschalk said Microsoft has helped their water system by investing in a significant upgrade near their Boydton data center.
“That was a $25 million project that was absorbed entirely by the industry and 0 by the ratepayer,” Gottschalk said. Microsoft is planning another upgrade to the water system in Clarksville, which the company is expanding its data centers.
The other big economic benefit has been significant tax revenue. Gottschalk said 45% of their real estate revenue is from data centers.
But the high salaries Microsoft pays could be making it tougher for some of Mecklenburg’s other employers.
One contractor said he can’t hire enough employees. “It has devastated our industry,” this employer told Radio IQ. “While I really don’t blame my employees.
And it’s gonna be a temporary good for them.”
He’s a general contractor who builds homes and he asked to be quoted anonymously. He suspects most of the jobs from the data center won’t last forever.
“So as soon as this build out is finished in another 8-10 years if it lasts that long, these people that are making $30, $40 an hour are gonna be without work,” the employer said.
Microsoft said they plan to stay in Mecklenburg County for many more years. If they did leave, it would mean this area has to once again deal with the fallout of losing an economic driver.
“So yes, anytime you get a huge disruption it’s gonna have an impact,” noted Paul Nichols, who was the school superintendent here from 2015-2023. Nichols said the county saw a big increase in school funding from data centers. But if that money ever leaves, Nichols said the county could be in a bind.
“You look into the future and you just have to keep your eyes open for what else might come in to replace those things,” Nichols said.
Mecklenburg County used funding from data centers to build a new middle and high school, which has over a dozen career training programs. Nichols said he thinks students will be better prepared, no matter what industry is here in the decades to come.
This is the first story in a two-part series. The second story looks at Mecklenburg’s new high school and a data center academy at the local community college.
