(La Porte, IN) - What was described as historic levels of new funding in the tens of millions of dollars a year will be coming to the city and schools in La Porte from a renegotiated agreement with Microsoft over its upcoming construction of a data center.

 

The money stems from a decision by Microsoft in January not to seek property tax relief on its projected $1 billion investment in LaPorte and other data centers the technology giant builds elsewhere.  

 

“We’re committed to being a good, responsible neighbor and we’ll pay our full and fair share of local property taxes, adding revenue to local towns and cities,” said Mike Stockwell, a Microsoft land development and permitting program manager.

 

Stockwell was among three other Microsoft representatives at a Tuesday press conference to announce the new deal.

 

Officials in La Porte were pleased with the original agreement from June of 2024 that called for the city and school corporation to share about $2.5 million annually over a 40 year period.  At the time, Microsoft was planning to seek tax abatement on the very costly equipment inside the facility but pay full property taxes on the building and the nearly 500 acres of farm land the data center will go up on along Boyd Boulevard just east of U.S. 35.

 

The new agreement calls for the city to collect 85 percent of Microsoft’s entire property tax bill with the remaining 15 percent going to the school corporation over 20 years.  Officials did not release specific figures, preferring to wait for the facility to be assessed once it’s constructed before estimating the total amount of new property tax funding.

 

However, City Councilman Tim Franke said the yearly property tax collections from Microsoft has the potential to “double or triple” the city’s annual $30 million budget.

 

“If you do the math, it’s a significant amount of money. We’ll see how it all shakes out,” he said.

 

La Porte Economic Advancement Partnership Executive Director Bert Cook called the influx of new funds “unlike anything we’ve seen before.”

 

Franke said it was Microsoft that approached the city about striking a new deal, which was given final approval Tuesday by the city’s Redevelopment Commission and school board.

 

LaPorte Schools Superintendent Dr. Sandra Wood said the amount of new revenue for the school corporation from Microsoft was the maximum allowed by the state for educational programs.  She also described the new agreement as “significantly more lucrative” than the previous deal and the amount of new funding it contains “unprecedented for a public school corporation in our state.”

 

Wood said there are no strings attached to the funding, which will be spent at the discretion of the school corporation.

 

Officials expect some of the funds to start being received in 2028 with full payment in 2029.  How the funds are spent will be decided later at some point.

 

But, Mayor Tom Dermody said a lot of the city’s money could go toward major needs such as repairing and upgrading infrastructure like streets that “we’re going to focus on as much as possible.”

 

“I think it will completely change our community,” said City Attorney Nick Otis.

 

School Board President Ryan Seaburg thanked Dermody for his leadership over the new deal and commitment to include the school corporation in the windfall.

 

“Your vision mayor Dermody to help our schools is appreciated by everyone in the community,” he said.