Elon Musk’s Twitter/X denied tax break for AI hardware in Georgia

Company claimed tax break would prevent it relocating to Portland, but then said it would be staying regardless of outcome

Elon Musk’s X has been denied a sizeable tax break for IT equipment in Atlanta, Georgia.

As reported by the Atlanta Journal-Constitution last week, a request from the social network firm formerly known as Twitter was denied a $10.1 million tax break by Fulton County officials.

The 10-year tax break would have been for a $700 million project to deploy IT equipment at a QTS facility at 1025 Jefferson Street. The company said the computer infrastructure would be used to develop and train artificial intelligence products for the X Platform, including Large Language Models and Semantic Search.

The Development Authority of Fulton County (DAFC) board deadlocked on a 4-4 vote (with one absentee) on a request for tax savings around new computer equipment for the company. The board will reconsider the application at the next meeting unless X withdraws the request.

X purchased 10,000 GPUs for an artificial intelligence project in April 2023.

The company had said the savings were needed to prevent X from choosing to install the equipment in Portland, Oregon – but during the meeting said the desire to deploy quickly meant some infrastructure would be deployed at the facility regardless of the incentive.

X acknowledged the project would not result in any new jobs, but merely retain 24 existing X jobs. The deal would reportedly generate more than $16 million in new tax revenues over the next decade.

“Develop Fulton’s assistance can make the difference to secure millions of dollars in new tax revenue for our region that may otherwise go to Portland or other locations, as well as a high likelihood of securing additional future investment for Fulton County, the City of Atlanta, and (Atlanta Public Schools),” Develop Fulton Executive Director Sarah-Elizabeth Langford said.

Voting against the proposals, DAFC member Laura Kurlander-Nagel said: “[X] is a privately held company that is owned by the richest man in the world… It’s [worth] less than half of what it was when he first purchased it. To me, that’s a huge concern.”

The same meeting saw new developer Edged Energy granted a tax break on a new proposed data center.

Details are unclear, but X moved into the QTS facility sometime around 2014, reportedly leasing some 80,000 sq ft at the time. The company previously moved into QTS’ neighboring 1033 Jefferson Street sometime around 2011, leasing more than 150,000 sq ft over the years.

Since acquiring Twitter in April 2022, the renamed X company has seen a large overhaul of its infrastructure.

Reports that the company was exiting one of its Sacramento facilities in California were revealed in December 2022, alongside plans to downsize the data center in Atlanta, Georgia. In June 2023, Elon Musk’s Tesla signed a lease on the NTT-owned data center vacated by X. The company also left another Prime-owned facility in Sacramento last year.

The company said it had “freed up 48MW of capacity and tore down 60,000 lbs of network ladder rack before re-provisioning it to other data centers” since the shutdown.

X had also been accused of not paying bills due to cloud providers – including GoogleOracle, and Amazon – in an attempt to renegotiate its bills. During the acquisition period and the months that followed, Twitter experienced a series of outages.