Return to Quincy: Ag land becomes fertile territory for data farms

QUINCY — On an August morning, two tractors hummed across a Quincy field, cutting corn where nearby rows of white industrial-looking structures seemed out of place.

What once was ground for growing food is now a data farm that helps keep people plinking on laptops, smartphones and other devices that rely on data stored in the cloud.

Much has changed in this rural Central Washington city over the past 15 years. The population has grown from 6,750 in 2010 to 8,725 today and a new subdivision has added about 400 homes.

Massive data centers owned by Microsoft, Dell and Yahoo now cover swaths of former farmland at the east and west ends of town.

City officials say increases in property tax revenue from the data farms are responsible for a new high school, a new library and a new City Hall, as well as upgrades to parks.

“We’ve actually just been blessed the data centers chose us because the (Grant County Public Utility District) was so proactive with their program and their fiber optics,” said Quincy Mayor Paul Worley.

Quincy’s property-tax revenue increased from $815,250 in 2005 to about $3.6 million in 2012, according to a New York Times story.

The annual boost to city coffers is more than helpful, Worley said.

“From being pretty much broke to where we were happy to get four used cop cars, now we're able to buy four new cop cars,” he said. “I can’t say we’re rich, but we’re better off than most the towns across the state.”

Area farmer Murray VanDyke said data centers do not bother him, but he does question why they were built on prime farm land.

“We’re designating some of our best farm ground under these huge buildings,” he said. “Other that that, they’re adding to the tax base.”

Not everyone in Quincy embraces data centers.

Former Mayor Patty Martin, who in the 1990s helped expose how steel mills and other dirty industries were recycling hazardous waste into fertilizer with no standards or regulations, challenged Microsoft over emissions produced by diesel-powered backup generators needed to keep data centers running around the clock.

“No, I’m not happy with them,” she said. “They have to do a monthly exercise of the engines to make sure they are working right. If there are 300 generators and 30 days in a month and all have to be exercised once a month, that means 10 have to be running at all times.”

Officials with the state Department of Ecology said limits have been set to assure safe emissions.

“Our permits require data centers to coordinate with each other to maintain and test their engines to reduce overlapping plumes. We also require data centers to quantify the health risk to the public from cumulative exposure to their emissions," said Ecology spokeswoman Emily Tasaka.

For every gain is a cost

Plenty of flat land within the city, relatively cheap electricity, a fiber optic trunk that runs clear to Seattle and water availability are some of the reasons data farm owners thought Quincy was a good fit, said City Administrator Pat Haley.

The data farms have brought about 1,000 jobs to Quincy, many of them tech positions, he said.

“It’s great diversity for the city of Quincy,” Haley said. "It used to be all ag.”

But now the city is running thin on water and electricity.

Data farms typically rely on water to cool their servers and electricity to keep running around the clock.

The city’s potable water is nearly fully allocated. Data farms leased about 800 acre-feet of water from the Quincy Irrigation District, but that contract expired last season. Now data centers want to renew the lease with an increased amount, Haley said.

Irrigation district officials aren’t sure there’s enough water to spare and are discussing whether to renew the contract, said Roger Sonnichsen, the manager of the irrigation district.

“That’s what we’re wrestling with now,” he said. “We have a canal that’s fully utilized during peak season. Our mission is to make sure our landowners receive their water first.”

The district serves 250,000 acres of farmland. Data farms, some looking to expand, currently occupy about 1,000 acres of land in the city.

Haley said other options are being explored, such as possibly tapping the nearby Columbia River for water that would be disinfected before being used as potable water.

Power

Grant PUD operates two Columbia River Dams — Wanapum and Priest Rapids — which have long provided cheap power.

Rates have steadily climbed since Quincy data centers began devouring electricity, though officials said it's not connected.

In April, residents, irrigators and large commercial entities will see a 3.53% rate increase while large industrial users such as data farms will see a 1.74% increase.

“The residential and irrigators are paying more of the increase than these big users are and I think that’s not fair,” said area farmer VanDyke.

It doesn’t necessarily mean the data centers are getting a huge break, said Grant PUD Chief Customer officer Ty Ehrnman.

The cost of serving residents is higher because there are more homes than data farms. Residential users need more transmission lines, more individual bills to send, and staff for the call center, he said.

“Data centers pay a lower kilowatt-per-hour charge, but they are paying above cost to serve,” Ehrnman said.

The rate increases are not because of the data centers, he said.

Before the data farms were placed here, there was a large surplus of power that the public utility had to sell to other communities at cost, Ehrnman said.

Now the data farms are using much, if not all, the surplus and they’re paying a better price for it than the discount rate it was being sold to other communities, he said.

“We’ve been able to claim that back,” Ehrnman said.

Selling the surplus power at a higher rate to the data farms helps keep rates lower for everyone else, Ehrnman said.

“We’ve been able to claim that (power) back and sell it to industry at a profit,” he said. “So growth in industrial use has really allowed us to keep rates low for the residential user.”

Now there’s a need for more power as the public utility is reaching capacity, Ehrnman said.

The utility is looking at new power generation sources. Hydro, nuclear, battery and solar plants are all possibilities, he said.

“Basically, anything is on the table right now,” he said.

• Editor's note: The Return to Quincy project is funded by TomKat Media, a film, television and media company founded by Tom Steyer and Kat Taylor to inspire creativity for the common good. Yakima Herald-Republic editors and reporters operate independently of our funders and maintain full editorial control over all project coverage.