Without jobs, why would Kamloops even want more data centres?

We already know what makes Aberdeen Mall a valued resident of Kamloops. It provides an indoor market for local vendors and shoppers, lots of starter jobs, it’s a community hub and it’s the third largest private taxpayer in the city.

It also comes with plenty of ongoing hidden costs we deem well worth it for residents — traffic congestion and road maintenance, increased police, water, sewer and power needs.

But now the Tournament Capital is pondering more of a new type of business, data centres, which change all the calculations. They don’t feed anyone, they won’t employ many people, they don’t improve the city or the lives of anyone living there. Kamloops has already got three on the books, why would it want more?

Local politicians can’t agree on costs and benefits. Some have been outright opposed, but now-mayor Mike O’Reilly previously said Kamloops can “play a big part” in the world AI boom, suggesting the Tournament Capital could double as the “AI Capital of Canada.”

He said the seismic stability and confluence of fibre optic networks makes Kamloops an ideal place for tech companies looking to build.

Coun. Katie Neustaeter is still waiting for city staff to answer the fundamental question. 

“When you hear from the community loud and clear that they care about this, they’re concerned about it and are demonstrating on these matters, it’s a council’s job to listen,” she told iNFOnews.ca.

Perhaps it’s because so few jobs will depend on future data centres makes them such an easy target for opponents. Water needs were once a valid concern but far less so in new generations of data centres.

But the lack of jobs is, strangely, a feature not a bug. That’s one of the stated benefits — taxation without costing the city anything. No new people to clog up traffic and local services and hospitals. Data centres don’t require trucks, waste removal, roads or drainage. It’s a box bearing cash.

Aberdeen Mall (and its more than 75 member businesses) pays a very rough estimate of $1.4 million in commercial property taxes. The better comparison for data centres is actually the second highest individual taxpayer, Trans-Mountain pipeline, which pays $2.8 million every year. It similarly has a small footprint and workforce, but obviously carries much higher hidden risk. The Kruger pulp mill employs more than 300 people and contributes a whopping 2.6 per cent of the city’s budget, roughly double Trans-Mountain. Consider that the next time you complain about the smell.

Kamloops planning manager Stephen Bentley cited privacy for not being able to reveal how much each of the existing Telus, Equinix and Bell data centres pay, but he did say those three facilities average around $600,000 in property taxes a year.

Those existing data centres are two older facilities — the Telus and Equinix server centres — along with the Bell facility that was opened on Missions Flats Road last year. The existing Telus facility is currently getting an upgrade as one of its “AI Factories.” City tax manager Norman Thompson added that the tax assessment of the properties is unaffected by the value of any computer equipment, just like a home isn’t taxed for the belongings inside.

They pay a basic commercial rate based on land value, falling in the same category as any retail store or warehouse, roughly a quarter of the pulp mill’s industrial rate.

Another way to assess the costs and benefits is the opportunity itself. The geographical benefits are well known, but simply having access to enough energy to power the data centres is a luxury not available everywhere — including the Okanagan, where a quirk of jurisdiction keeps Kelowna, Penticton and Vernon on the sidelines.

Advantage Kamloops, if it wants to take it.

“As we approve any kind of development, that can be a signal to other developers or investors that we’re a place that’s open to business. That could encourage future investment,” Bentley said.

Of course data centres have wider benefits not specific to Kamloops. A Bell spokesperson said its data centres will be for both commercial and academic uses, partnering with Thompson Rivers University. He also touted the economic spin-off, while the projects are part of a wider Canadian computing network.

“These investments support construction and skilled technical employment, as well as opportunities for local contractors and service providers… Together, these projects are helping build the infrastructure and skills needed for Canadian businesses and researchers to develop and deploy AI here at home,” spokesperson Matt Silver said in a written response.

The federal government is backing the data centre buildout to strengthen Canadian sovereignty no less. But the spin-offs for local economies aren’t so clear to city councillors like Neustaeter.

“I haven’t heard of anything like an incentive program that would… offer a carrot instead of a stick if you’re an appropriate community for an AI data centre,” she said.

The new city council is expected to see a data centre report from staff at some point in the coming weeks, outlining how they affect the city and what tools council might have to regulate them locally.

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Levi Landry

Levi is a recent graduate of the Communications, Culture, & Journalism program at Okanagan College and is now based in Kamloops. After living in the BC for over four years, he finds the blue collar and neighbourly environment in the Thompson reminds him of home in Saskatchewan. Levi, who has previously been published in Kelowna’s Daily Courier, is passionate about stories focussed on both social issues and peoples’ experiences in their local community. If you have a story or tips to share, you can reach Levi at 250 819 3723 or email LLandry@infonews.ca.