RENO — Apple CEO Tim Cook joined Nevada Gov. Brian Sandoval and Reno Mayor Hillary Schieve at a groundbreaking Wednesday for a new $4 million warehouse in downtown Reno as the company announced plans to invest $350 billion in the U.S. economy over the next five years.
Sandoval, Schieve and others praised the move and Apple’s earlier commitment to double the size of its $1 billion data center east of Reno as important milestones in the economic recovery of Nevada, one of the states hardest hit by the recession seven years ago.
“We are pleased to be part of transforming downtown Reno to the vibrant city it should be,’” Cook said at the ceremony for the shipping and receiving facility a few blocks east of the downtown casino district. “Our commitment to Reno and Northern Nevada is representative of the commitments we’ve made throughout the U.S.”
Cook said the company’s five-year U.S. plan will generate 20,000 Apple jobs and include more than $10 billion for projects like the data center in Washoe County along Interstate 80 east of Reno and Sparks.
As a result of the tax reform bill signed last month, Apple plans to bring back most of its roughly $252 billion in offshore cash, generating a tax bill of about $38 billion. It’s something Cook promised the company would do if it could avoid being taxed at the 35 percent rate that had been in effect under the previous tax law.
About $75 billion of the $350 billion in U.S. investments will be paid from money that had been overseas, Apple estimated.
Companies that bring back money stashed overseas this year will be taxed at a 15.5 percent rate, below the new 21 percent rate for U.S. corporate profits under the new law.
Apple announced plans for the downtown warehouse in May at the same time it announced plans for a $1 billion expansion of that data center, which will include 100 permanent workers, doubling its workforce. About 300 temporary construction jobs also will be created, the company said.
Breaking ground in Reno today with @GovSandoval & @MayorSchieve as part of our data center expansion plan, one of many Apple initiatives which will contribute $350 billion to the U.S. economy and create 20,000 new jobs over the next 5 years. pic.twitter.com/g40dlHsxuC
— Tim Cook (@tim_cook) January 17, 2018
The 5-year-old data center is located in the Reno Technology Center along I-80. It’s between Reno and the Tahoe Reno Industrial Center, where Tesla’s giant battery factory is based about 15 miles east of Reno-Sparks. The warehouse will be used to ship equipment to the expanding facility.
Apple was awarded $89 million in state property and sales tax abatements when it committed to the data center in 2012. Building a facility in downtown Reno was necessary for it to fully realize all the potential tax breaks.
Sandoval said earlier that the data center was the first major economic development success in Northern Nevada and “helped place this region on the technology and innovation map.”
Since that time, Nevada has added nearly 250,000 jobs statewide, the governor said Wednesday.
Steve Hill, director of the Governor’s Office of Economic Development, said Nevada’s economy was “really the worst in the U.S.” seven years ago, when it led the nation in unemployment, foreclosures and bankruptcies. It now ranks among the fastest-growing states in terms of both jobs and wages.
“Apple’s decision in 2012 to invest in Nevada, to locate their data center here, really marked the turning point and was the catalyst for moving this region and, frankly, the entire state forward,” Hill said.
Like a visit from Mount Olympus
Gov. Brian Sandoval said he told Apple CEO Tim Cook — whose appearance was kept secret until about 90 minutes before the event — that “it’s like someone coming from Mount Olympus to Reno for a day.”