Prescott Balch - Data Center Impacts to Wisconsin Communities - Episode #68

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What's up friends, welcome back
to Rooted Wisconsin.

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Appreciate you for clicking
another episode.

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Grateful to have you here.
Today's episode is with Prescott

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Balch.
Fascinating conversation.

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You know, I've been looking for
someone to talk with about the

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impact of data centers and the
process of back and forth with

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them when they come to a
community, and Prescott is

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exactly that person.
Awesome conversation.

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Really dove into the details of
what communities need to

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consider when a proposed data
center comes to your spot.

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We see this across Wisconsin
right now and him and an

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excellent group of individuals
have AI.

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Guess I'll call them a set of
resources willing to help after

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they want to battle against one
in a place that didn't seem to

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make a lot of sense.
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Without further ado though,
let's jump into it.

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Prescott Balch So
Well, again, thanks for making

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the trip.
Pleasure.

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I appreciate it.
I'm really excited to learn some

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things today.
We generally tell the story of

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people, so I'm sure I'm going to
delve into that territory too.

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Because in in when I asked you
to be on.

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Oh, I should fix your mic too.
OK, super.

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When I had, when I had initially
reached out, I came across the

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social media post came, you were
the subject matter expert and

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first thing I did was kind of
checked out your LinkedIn

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profile in your background and
then see what you've done.

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So I, I, there has to be a
fascinating path to the

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conversation that leads us to
here today too.

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But also this one's a little bit
different too, because I, I

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think we're going to try to shed
some light on and for me, and I

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think probably a lot of other
people learn some of the impacts

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that are, you know, in the midst
of have and potentially will be

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coming to impact Wisconsin
communities, which I think is

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super important.
So I guess maybe first, what was

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the event that I came across you
learning about you and, and what

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you do?
What what did you do in let with

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the folks in in that community
and kind of what leads you to

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the chair?
Sure.

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So the Greenleaf presentation
that I did was is what is now a

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fairly well rehearsed
presentation that I do on the

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risks that come along with the
rewards of large data center

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proposals.
The the path that I was on to

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get there was that back in the
summer and early fall, I had a

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proposal land in my backyard in
Caledonia.

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I had recently retired from a
long technology career, very

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successful career, writing,
managing large complex software

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systems in the financial
services industry.

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And so I knew a thing or two, I
guess, about technology.

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And when the proposal landed in
my town, I, I sort of pride

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myself on being reasonably
objective.

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I had, I had a background that
would say I'd likely be in favor

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of such a thing, but I had a
proximity to it that would seem

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likely to be opposed to it.
And so I wanted to be very

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objective about reviewing the
proposal, understanding its pros

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and cons.
And, and I joined forces with an

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A group of people locally to
resist because what I saw I

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really didn't like.
I didn't think that it was the

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right location inside of our
town.

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There were other places where
they could have put it that

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would have been better.
And anyway, dug really deep into

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the pros and cons and we
successfully resisted that

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proposal.
Microsoft backed out just before

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the final vote.
And after that, my phone started

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ringing my my literal phone and
my social media handle phone.

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I got lots of contacts because
we became a pretty hot story

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about a community that actually
won.

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And I am, I bristle at
unfairness, I guess, and, and

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the, the information imbalance
in an equation in, in a proposal

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like that.
And so I looked around the rest

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of the state and I saw these
other proposals and of people

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calling me.
And I thought, you guys are,

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you're in a way worse situation
than I was because I at least

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brought a technical background
and a financial services

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background to the discussion.
And I could, I think, add a ton

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of value.
So I just started helping

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people.
I started telling them what we

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did what what was successful for
us and what we stayed away from

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because we didn't think it would
be successful.

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And it's just mushroomed from
there that the proposals are

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never ending.
The Greenleaf back to that place

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where we've now intersected.
That was just another in the

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string of communities that have
reached out to me to ask for

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some assistance.
And I've been as generous as I

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possibly can be with my time to
make the rounds, help people

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out, share lessons learned
documents, share my technical

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expertise.
I have a very, very specific

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focus on the topic that's
technical and financial and what

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risks that creates for
particularly small communities.

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And I think it's a very
compelling argument and it's the

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main one that I share, but there
are related ones as well, just

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about construction and such that
I think are relevant.

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But I've just been telling that
same story over and over and

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over to as many communities as
ask, ask for help.

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And it's not limited to
Wisconsin anymore either.

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It's, it's gone multi state.
I, I think I've, I just was

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counting before I got here.
I think I'm at my 8th state that

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has contacted me for at least an
initial call and some advice if

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not more than that.
And so yeah, I'm a travelling

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show now that is just trying to
help what I say.

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I'm trying to level the playing
field.

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The Fortune 100 company against
tiny little 2000 person town is

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just not a fair fight.
Truly David.

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Goliath.
You're you're not going to have

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all the information that you
need to make a good decision.

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I'm not trying to convince you
one way or the other on on the

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decision.
I'm trying to give you all of

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the information that you need to
make a wise decision.

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And everybody will and should
weigh each of the risks and

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rewards according to their
needs, their own community's

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needs.
I can't make that waiting up for

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you, but I can give you all of
the things that you need to

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wait.
And that's what I've been trying

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to do and.
Yeah, yeah.

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Keeping me busy.
I bet because it's such critical

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information right now, it, it is
such a nebulous territory for

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that small town, that small area
to try to navigate versus

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something like this.
Adjacent to this conversation, I

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have a former, former Meta
employee that I've been talking

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with that says she has
information that could be

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interesting to talk about on the
podcast.

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We'll leave it there for now,
but that that encompasses my

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entire kind of stance and point
right now is that that

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empowerment is so critical right
now because that voice doesn't

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have nearly the representation
or the resources that the

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Fortune 100 company does.
So maybe can we start with what

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are some of those positives and
negatives?

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Can we get a kind of lay of the
land of what are the things that

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should be considered for, you
know, generic middle of

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Wisconsin town?
I know it's not a silver bullet,

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but what are some of those
positives and negatives?

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Well, the positives are.
Almost.

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Exclusively, the amount of tax
revenue that they're projecting

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that your locality will get,
whether that's your village,

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whether that's the county, the
school system, the Community

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College district, those 4 taxing
authorities are absolutely going

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to for some period of time,
we'll come back to that.

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But for some period of time,
potentially long period of time,

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you will be wealthy beyond
belief.

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The smaller the town, the bigger
the footprint.

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So there's an enormous amount of
revenue because these hyperscale

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data centers are so large.
There are million, 2,000,000

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square feet.
They're massive.

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So in no uncertain terms,
there's a pot of gold there that

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you will have for some period of
time.

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The other absolute benefit is
the amount of construction work

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that it generates and the amount
of construction jobs that it

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supports for a very long time.
These are large data center

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campuses that are multiple
buildings generally don't build

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all the buildings at the same
time.

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They build them consecutively in
order to manage their own risk

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of technology change, which as
you all know, happens all the

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time.
So you can have a decade's worth

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of construction jobs and a large
number of them in a relatively

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small community.
And that generates obviously the

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construction jobs, but it also
very legitimately generates a

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lot of indirect economic impact
while those construction jobs

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are in your town.
That's what the those are the

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headlines of the pro development
cohort is going to tell you.

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And it's all true.
That part is true.

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The then there's a category of I
think benefits they overstate.

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So one would be the permanent
direct employment that a data

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center generates.
Those numbers are very low.

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I am a fax and data guy.
I like sightable sources.

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So I went and found the the
rosiest accurate or rosiest

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precise number of direct
employment in Northern Virginia

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in the data center industry.
So Northern Virginia is the

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biggest, it's called data center
alley.

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It's got the biggest number of
data centers.

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So I figured, well, that's a,
that's a pretty decent sample

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size, right?
We can go with that number.

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And then I went and I got the
rosiest forecast or not

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forecast, but count of data
center jobs from their own

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economic development Corp in, in
that area.

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And they said there were roughly
10,000 direct jobs and data

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Centers for 549 data centers.
Let's if you do the math, that's

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18.
So if you tell me that they're

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going to be 50 employees for
building or 100 or 200, then

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tell me why your data centers
are different than all of the

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ones in Northern Virginia.
I'm going to go with the

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actuals, but also as an insider
in the technology field, I know

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they have a phrase that's called
lights out operation, which is

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it's their way of defining the
goal for minimizing, if not

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getting all the way to
elimination of human beings in

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the data center.
Like we, we, we as the industry

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long ago solved the problem of
remote management of machines

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long ago.
And so since solving that

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problem, the goal has always
been, well, let's have as few

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people in the data center as
possible that all of the jobs

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that are generated from it are
going to be someplace else.

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They're going to be in the
places that revolve around the

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software and out the hardware.
So data centers don't employ a

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lot of people.
They don't they don't attract a

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lot of supply chain businesses.
They're they, they replace all

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their equipment regularly, the
computers and the disk drives

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and so on.
There's a regular replacement

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schedule, but all of that stuff
is manufactured overseas,

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certainly outside of Wisconsin.
So those benefits are usually

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overstated as part of the sales
pitch, which, you know, whatever

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salespeople will tell you, yeah,
what, whatever, whatever lights

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you up, you should just not, you
know, like any salesperson you

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shouldn't trust, you should
verify.

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And the numbers just don't
support the claims.

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The downsides, though, are
really risks and significant

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risks Even so.
The first one is particular to

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small towns, and by small towns
I would say 30,000 people or

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less.
There's a saying in financial

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services called financial
concentration risk.

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Simple, simple math.
You know, you don't put all your

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eggs in one basket.
You don't invest all of your

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retirement money in one volatile
stock.

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So the technology industry is
somewhat volatile.

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It's changing all the time.
There's a relatively short

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lifespan to most technology
products.

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The the product, so to speak, or
the component of technology that

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sort of lasts the longest is the
one that's physically the most

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expensive to build and maintain,
which is a data center.

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So they tend to last longer than
your phone.

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They tend to last longer than
the software, which you can

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literally throw away without
without concern.

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00:15:27,120 --> 00:15:29,640
So data center will last longer,
but they don't last forever.

230
00:15:30,800 --> 00:15:32,720
We change technology there as
well.

231
00:15:32,880 --> 00:15:38,640
And we're building entirely
different data centers today

232
00:15:38,640 --> 00:15:41,880
than we were even 5 to 10 years
ago.

233
00:15:42,440 --> 00:15:45,320
They're much larger.
They have much more computing

234
00:15:45,320 --> 00:15:47,600
power in them.
They require much more energy.

235
00:15:48,440 --> 00:15:54,840
And there's a risk of that
technology change causing harm

236
00:15:55,560 --> 00:16:00,920
to an A small municipality that
has that financial concentration

237
00:16:00,920 --> 00:16:04,720
risk.
If you fast forwarded, say, 15

238
00:16:04,720 --> 00:16:08,480
years, you've got a village
that's paved its streets with

239
00:16:08,480 --> 00:16:11,800
gold that is chauffeuring your
kids to school every day because

240
00:16:11,800 --> 00:16:13,240
they don't know what to do with
all this money.

241
00:16:14,280 --> 00:16:19,000
All of a sudden that valuation
of that building drops because

242
00:16:19,000 --> 00:16:21,440
the technology changed and now
everybody wants to build a

243
00:16:21,440 --> 00:16:24,640
different kind of building.
And it's harder to rent out the

244
00:16:25,160 --> 00:16:28,840
the data center space and the
one that you built in tiny town

245
00:16:28,840 --> 00:16:33,480
Wisconsin, you can lose a big
portion of that tax revenue like

246
00:16:33,480 --> 00:16:35,800
that because of that technology
change.

247
00:16:36,880 --> 00:16:44,040
The very stark risk on the
extreme end of that is complete

248
00:16:44,040 --> 00:16:49,080
obsolescence.
Some whiz kid comes up with some

249
00:16:49,280 --> 00:16:54,680
fantastical improvement to the
software that renders half the

250
00:16:54,680 --> 00:16:59,000
data centers we built like
unnecessary because now

251
00:16:59,000 --> 00:17:05,520
artificial intelligence as a
computing event is 1/3 is as

252
00:17:05,520 --> 00:17:08,440
expensive as it used to be, or a
tenth of as expensive in

253
00:17:08,440 --> 00:17:10,200
computing resources as it used
to be.

254
00:17:11,040 --> 00:17:14,599
So how many of these things are
we really going to need if some

255
00:17:14,599 --> 00:17:16,280
of those improvements come to
pass?

256
00:17:17,640 --> 00:17:23,880
That kind of volatile change in
the industry has significant

257
00:17:23,880 --> 00:17:28,079
impact on building valuation and
complete obsolescence.

258
00:17:28,079 --> 00:17:34,360
And you know the the magnitude
of the change can drive the

259
00:17:34,360 --> 00:17:36,920
magnitude of the impact on the
small village and where the

260
00:17:36,920 --> 00:17:40,880
small town that's hosted one of
these things is relying on it

261
00:17:40,880 --> 00:17:42,800
for such a large percentage of
their income.

262
00:17:43,240 --> 00:17:45,680
There is just a really bad scene
at the end of that.

263
00:17:47,680 --> 00:17:54,680
So the, the other thing I wanted
to mention around risks is the

264
00:17:54,680 --> 00:17:57,560
risk of that consecutive
construction schedule.

265
00:17:58,360 --> 00:18:01,960
So it's actually helpful to
manage the risk that I just

266
00:18:01,960 --> 00:18:04,840
talked about of obsolescence by
stringing the construction out.

267
00:18:04,840 --> 00:18:10,760
So the, the developer will use
new technology, say, every two

268
00:18:10,760 --> 00:18:13,320
years when they're starting a
new building and, and the

269
00:18:13,320 --> 00:18:17,800
village or town gets to manage
its risk a little bit by having

270
00:18:18,080 --> 00:18:20,440
fewer obsolete all at once
buildings.

271
00:18:21,400 --> 00:18:25,880
However, that, like all good
things, comes with another edge

272
00:18:25,880 --> 00:18:28,440
on the, on the sword.
And the other edge of that sword

273
00:18:28,440 --> 00:18:33,160
is you've got a construction
site that's 10 years long.

274
00:18:34,280 --> 00:18:40,880
And today we tolerate, say, a
house being built next door

275
00:18:41,480 --> 00:18:46,040
because it's, it's not that
invasive an activity and it's

276
00:18:46,040 --> 00:18:48,280
only going to last a few months.
And then your neighbors move in,

277
00:18:48,280 --> 00:18:50,160
you like them and have barbecues
with them.

278
00:18:50,920 --> 00:18:55,160
But a data center construction
site, if you haven't been to 1,

279
00:18:55,160 --> 00:18:58,360
you really should to get a sense
for just how industrial scale

280
00:18:58,360 --> 00:19:02,360
they are.
They're massive, absolutely

281
00:19:02,360 --> 00:19:04,200
massive.
Drive past the one in Port

282
00:19:04,200 --> 00:19:06,080
Washington, drive down to Mount
Pleasant.

283
00:19:07,080 --> 00:19:13,080
These are these are very
different than the end use of

284
00:19:13,080 --> 00:19:17,200
the of the property.
All of the zoning that we've

285
00:19:17,200 --> 00:19:21,800
done historically has been
around permanent usage, not

286
00:19:21,800 --> 00:19:26,080
about trying to govern much of
the construction, let let alone

287
00:19:26,080 --> 00:19:30,080
dictate, you know, a usage of a
property based on the impact of

288
00:19:30,080 --> 00:19:33,640
the construction.
But the construction here is so

289
00:19:33,640 --> 00:19:37,400
invasive and can last for so
many years that you have to sort

290
00:19:37,400 --> 00:19:41,240
of take a pause and say, do I
want to put this anywhere near a

291
00:19:41,240 --> 00:19:46,280
residential area?
Do I want to subject is it even

292
00:19:46,400 --> 00:19:51,920
is it even moral to to subject
a, a group of residents to 10

293
00:19:51,920 --> 00:19:55,760
years worth of construction of
an industrial scale?

294
00:19:55,880 --> 00:20:00,680
And that was one of the key
problems in in my community was

295
00:20:00,680 --> 00:20:03,560
a low density residential area.
But there were 100 homes within

296
00:20:03,560 --> 00:20:08,920
a mile in a, in a sort of UN
unblocked mile as well.

297
00:20:08,920 --> 00:20:12,400
Not it wasn't forested or
something to to block a lot of

298
00:20:12,400 --> 00:20:15,360
the noise and dust and it it
would have been.

299
00:20:16,200 --> 00:20:22,520
A huge property value loss
during that 10 year period, it

300
00:20:22,520 --> 00:20:27,080
would have been a a burden on
those residents that bordered on

301
00:20:29,680 --> 00:20:35,360
what's the word I want it's like
just shy of evil to do that on

302
00:20:35,360 --> 00:20:36,760
purpose to somebody.
You know you.

303
00:20:37,560 --> 00:20:41,840
So, you know, all of these
things, all of these risks,

304
00:20:43,120 --> 00:20:47,560
there is a way to manage them
or, or mitigate them

305
00:20:48,200 --> 00:20:52,280
contractually, but you can't do
that if you don't know to do

306
00:20:52,280 --> 00:20:55,840
that.
And, and back to how I, why I

307
00:20:55,840 --> 00:21:01,400
got involved in all this.
I, I can't sit idly by and know

308
00:21:01,400 --> 00:21:05,000
that some little community has
no idea what these risks are and

309
00:21:05,000 --> 00:21:07,400
they're about to make an
agreement and not realizing what

310
00:21:07,400 --> 00:21:10,720
might happen in five, 10/15/20
years.

311
00:21:11,280 --> 00:21:14,400
And I just feel like if you put
this information in front of

312
00:21:14,400 --> 00:21:19,120
them and say, 1, you have all
these risks, decide what's

313
00:21:19,120 --> 00:21:20,760
right.
Two, if you decide if you're

314
00:21:20,760 --> 00:21:24,040
going to decide to go forward,
here are some other strategies

315
00:21:24,040 --> 00:21:27,840
that other communities have
employed to try to manage those

316
00:21:27,840 --> 00:21:29,600
risks.
Yeah.

317
00:21:30,520 --> 00:21:35,120
And in like you drive through
them so like they're they're

318
00:21:35,120 --> 00:21:39,000
almost, they're almost ominous
in a way.

319
00:21:39,000 --> 00:21:41,720
It seems like a movie.
Yeah, for sure.

320
00:21:41,720 --> 00:21:44,480
It feels very strange.
And that's a very interesting

321
00:21:44,480 --> 00:21:46,560
description.
I lived in the UP for quite some

322
00:21:46,560 --> 00:21:50,640
time, and I can't help but think
of the UP and the evolution of

323
00:21:50,640 --> 00:21:56,000
the mining industry there of a
once very booming place with all

324
00:21:56,000 --> 00:22:02,000
of their eggs in one basket.
And when that ask it leaves, we

325
00:22:02,080 --> 00:22:06,440
like we've seen the decades long
deterioration of UP communities

326
00:22:06,440 --> 00:22:09,720
because there are no more fiscal
resources that they can lean on

327
00:22:10,880 --> 00:22:13,920
and they haven't addressed it
with tourism like they haven't

328
00:22:13,920 --> 00:22:16,480
addressed it with industry like
there, there is no replacement.

329
00:22:16,680 --> 00:22:21,360
And then we see the gradual
degradation of these

330
00:22:21,360 --> 00:22:22,880
communities, which is
concerning.

331
00:22:22,880 --> 00:22:25,240
And I can't help but think of
that hearing you kind of walk,

332
00:22:25,240 --> 00:22:28,120
yeah, through those.
I, I had a presentation that I

333
00:22:28,120 --> 00:22:31,720
did in Michigan and I said to
them essentially the same thing.

334
00:22:32,160 --> 00:22:36,000
Of all the places in the country
that should know better than to

335
00:22:36,000 --> 00:22:42,400
walk into a single industry,
single taxpayer concentration

336
00:22:42,400 --> 00:22:45,480
risk, it should be Michigan.
You guys should know better than

337
00:22:45,480 --> 00:22:47,400
this.
Like don't, don't go eyes wide

338
00:22:47,400 --> 00:22:49,240
open into that.
You know how that ends.

339
00:22:50,760 --> 00:22:54,360
There's a, there's an
interesting difference with data

340
00:22:54,360 --> 00:22:59,440
centers versus mining or
automobile manufacturing that

341
00:22:59,440 --> 00:23:03,120
can be pitched as both a
positive and a negative with

342
00:23:03,120 --> 00:23:05,760
respect to that concentration
risk.

343
00:23:05,760 --> 00:23:09,400
And, and one way to look at it
is to say, well, there are no

344
00:23:09,400 --> 00:23:14,720
employees.
So if, if the money dries up, at

345
00:23:14,720 --> 00:23:18,760
the very least you haven't
fired, you know, 70% of the you

346
00:23:18,760 --> 00:23:21,800
don't have 70% unemployment in
your town because the place

347
00:23:21,800 --> 00:23:25,880
didn't hire anybody.
OK, Yeah, that's better.

348
00:23:26,400 --> 00:23:28,920
But the flip side of that is,
well, they're going to be more

349
00:23:29,000 --> 00:23:33,000
likely to walk out when the math
says walk out because they have

350
00:23:33,000 --> 00:23:36,400
no connection to the community
as an as a taxpayer.

351
00:23:37,040 --> 00:23:41,960
They've they've essentially just
purchased a whole bunch of land

352
00:23:42,000 --> 00:23:46,280
in your village limits and
they've put a giant building

353
00:23:46,280 --> 00:23:48,520
there and housed their servers
there.

354
00:23:49,160 --> 00:23:52,760
And they're going to be there as
long as the math says to be

355
00:23:52,760 --> 00:23:54,640
there.
And then they're going to leave

356
00:23:55,120 --> 00:23:59,480
without saying goodbye.
There's just, there's no

357
00:23:59,480 --> 00:24:06,440
connection at all.
And and, but in Full disclosure,

358
00:24:06,440 --> 00:24:11,320
you've got people on different
polar opposites of the debate

359
00:24:11,320 --> 00:24:14,000
saying one of those is, you
know, that same thing is good.

360
00:24:14,000 --> 00:24:15,800
And the other people say, yeah,
that's bad.

361
00:24:16,960 --> 00:24:21,480
It's a mixed bag.
Yeah, that, so that incentive

362
00:24:21,480 --> 00:24:24,560
concerns me a little bit,
especially through the lens of

363
00:24:24,560 --> 00:24:29,280
the people who end up by proxy
being the the representative of,

364
00:24:29,560 --> 00:24:33,880
you know, formulating the
contract or going through with

365
00:24:33,880 --> 00:24:37,400
the process.
Because the fiscal immediate

366
00:24:37,400 --> 00:24:39,120
benefit I didn't know was that
large.

367
00:24:39,160 --> 00:24:41,160
I I didn't know it could be that
impactful.

368
00:24:41,720 --> 00:24:45,880
So through the lens of a local
politician or something, that's

369
00:24:46,280 --> 00:24:49,720
very favorable, right?
Like, they can use those funds,

370
00:24:49,760 --> 00:24:53,200
but that brings motive into the
conversation.

371
00:24:53,200 --> 00:24:58,680
Well, OK, you, you're going to
take me down a really big rabbit

372
00:24:58,680 --> 00:24:59,560
hole.
Love it.

373
00:24:59,560 --> 00:25:01,840
That might be several episodes
long.

374
00:25:03,320 --> 00:25:09,240
Try me.
So one of the things I quickly

375
00:25:09,240 --> 00:25:15,080
learned by diving into my own
proposal and diving into my own

376
00:25:15,600 --> 00:25:22,440
villages finances was how one,
municipal financing and two,

377
00:25:22,440 --> 00:25:26,600
municipal budgeting works in the
state and what laws govern it

378
00:25:26,920 --> 00:25:29,200
and what incentives that that
creates.

379
00:25:30,920 --> 00:25:34,120
And I was just in Port
Washington earlier this week

380
00:25:34,120 --> 00:25:37,720
giving a presentation to them
and their projects obviously

381
00:25:37,720 --> 00:25:41,360
already underway, but lots of
controversy about how it

382
00:25:41,360 --> 00:25:44,120
happened.
And I was asked to come up and

383
00:25:44,120 --> 00:25:45,960
give a talk.
And I decided I was going to

384
00:25:45,960 --> 00:25:48,640
give him a talk on how you got
here.

385
00:25:49,320 --> 00:25:53,120
What were the incentives that
were created by state law?

386
00:25:54,120 --> 00:25:58,000
Why are people behaving the way
they were behaving and what are

387
00:25:58,000 --> 00:26:01,120
they trying to achieve?
And why did they do the deal?

388
00:26:01,120 --> 00:26:04,360
Like, if you can understand the
some, the people that made the

389
00:26:04,360 --> 00:26:07,720
decision are not stupid people,
that they had a reason.

390
00:26:08,000 --> 00:26:10,440
Maybe they misjudged something,
maybe they misunderstood

391
00:26:10,440 --> 00:26:12,520
something, I don't know.
But they're not stupid people.

392
00:26:12,840 --> 00:26:16,600
They had to have motives that
should at least be explainable

393
00:26:16,600 --> 00:26:21,120
even if you disagree with them.
So I I went through that top to

394
00:26:21,120 --> 00:26:24,560
bottom.
Here's the sequence of state

395
00:26:24,560 --> 00:26:28,760
laws that conspire to create
this perfect storm of incentives

396
00:26:29,080 --> 00:26:33,520
that is creating all of these
data center proposals in this

397
00:26:33,520 --> 00:26:37,080
state and in a lot of other
states as well, but particularly

398
00:26:37,080 --> 00:26:40,320
in Wisconsin.
And it all starts, and I joked

399
00:26:40,360 --> 00:26:44,320
it starts in 2013, but the
story's not that long.

400
00:26:44,320 --> 00:26:46,920
So don't, don't get, don't get
too discouraged yet.

401
00:26:47,440 --> 00:26:52,880
But in 2013, there was a change
to the the state law that

402
00:26:52,880 --> 00:26:58,280
dictates how much a community
can raise its tax levy.

403
00:26:59,200 --> 00:27:02,000
Tax levy being the sum of all
tax bills.

404
00:27:02,880 --> 00:27:06,680
So well-intentioned but poorly
executed, I call it.

405
00:27:07,360 --> 00:27:13,240
The intention was these
cavalier, irresponsible local

406
00:27:13,240 --> 00:27:16,480
officials are just going to
raise your taxes to make their

407
00:27:16,480 --> 00:27:19,760
budgeting decisions easier.
And your taxes are going to

408
00:27:19,760 --> 00:27:22,800
suffer year over year over year.
And we're going to save you as

409
00:27:22,800 --> 00:27:26,560
the state legislature.
And so we're going to create a

410
00:27:26,840 --> 00:27:30,200
algorithm that defines how much
they're allowed to raise the

411
00:27:30,200 --> 00:27:34,960
taxes so that you your own tax
bill doesn't keep going up

412
00:27:37,800 --> 00:27:39,560
without some justification for
it.

413
00:27:40,360 --> 00:27:47,200
And they created a single
variable called that new

414
00:27:47,200 --> 00:27:51,280
construction that drives how
much the tax levy can rise.

415
00:27:52,320 --> 00:27:57,200
So net new construction is if
I've had, I'm going to have to

416
00:27:57,200 --> 00:28:00,680
do math in my head, which is
always troubling.

417
00:28:01,160 --> 00:28:04,080
Let's save $25 million in new
construction.

418
00:28:04,080 --> 00:28:07,120
So you add up all the permits
and the value that they produced

419
00:28:07,240 --> 00:28:09,000
through the year.
You have 25,000,000.

420
00:28:09,440 --> 00:28:13,320
And let's say your total
valuation of all your existing

421
00:28:13,320 --> 00:28:16,840
buildings is 100 million.
Well, if you had that, you could

422
00:28:16,840 --> 00:28:27,080
raise your levy 25%, but you
have $25 million in new, you

423
00:28:27,080 --> 00:28:29,640
have $25 million in new
valuation to tax.

424
00:28:30,040 --> 00:28:35,280
So if your tax levy is going up
25%, presumably you've got

425
00:28:35,280 --> 00:28:37,680
somebody to pay for that 25%
increase.

426
00:28:37,680 --> 00:28:40,640
So that's fine.
What the state legislature was

427
00:28:40,640 --> 00:28:44,560
doing was just saying we need a
proxy for why a a city would

428
00:28:44,560 --> 00:28:48,840
need to add more cost and
construction seems to be a

429
00:28:48,840 --> 00:28:53,920
reasonable proxy.
You could do it with population,

430
00:28:53,920 --> 00:28:57,600
but we don't have population
counts that are accurate

431
00:28:57,600 --> 00:29:01,600
accurate year to year.
So let's go with construction.

432
00:29:01,600 --> 00:29:07,320
Sounds good, and it's a
reasonable proxy, but there are

433
00:29:07,320 --> 00:29:09,240
a couple of problems with it I.
Was going to say, is it though?

434
00:29:09,720 --> 00:29:16,160
Well, right, the first problem
is people have, will they have

435
00:29:16,160 --> 00:29:19,720
agency?
And if I tell you as a local

436
00:29:19,720 --> 00:29:23,160
official, the only way you can
raise your levy and pay your

437
00:29:23,160 --> 00:29:26,200
cops a raise and your get your
firefighters and your trucks and

438
00:29:26,440 --> 00:29:29,720
equipment and so on.
If if you tell me that's the

439
00:29:29,760 --> 00:29:33,400
only way to manage the budget,
then I am going to work my butt

440
00:29:33,400 --> 00:29:36,320
off to get new construction,
right?

441
00:29:36,400 --> 00:29:39,160
It is.
So if you could, if you could

442
00:29:39,160 --> 00:29:41,560
secretly watch how much
construction there was and say,

443
00:29:41,560 --> 00:29:44,280
OK, you can raise your levy 3%,
that would be one thing because

444
00:29:44,280 --> 00:29:47,440
you wouldn't be affecting the
behavior of individuals.

445
00:29:47,720 --> 00:29:51,120
But as soon as you publish the
stupid algorithm they're going

446
00:29:51,120 --> 00:29:53,640
to, they're going to try to
juice the construction numbers

447
00:29:53,640 --> 00:29:54,920
and well, how are they going to
do that?

448
00:29:54,920 --> 00:29:57,720
Well, they're going to call
their commercial real estate

449
00:29:57,720 --> 00:30:03,440
friends and say, can you come
build here or data center

450
00:30:03,440 --> 00:30:07,320
company XYZ is going to call and
say I can give you a lot of new

451
00:30:07,320 --> 00:30:11,400
construction, dude.
So you can see now dots starting

452
00:30:11,400 --> 00:30:16,720
to connect with why these local
officials are so excited at

453
00:30:16,720 --> 00:30:19,760
least out of the gate for the
data center projects because

454
00:30:19,760 --> 00:30:26,280
they represent a solution for
the next 20 years on raising

455
00:30:26,280 --> 00:30:28,640
that levy.
And they don't necessarily need

456
00:30:28,640 --> 00:30:31,360
to take all of the new
construction and raise the levy

457
00:30:31,360 --> 00:30:34,320
50 sixty 70%.
But man, I don't have to worry

458
00:30:34,320 --> 00:30:39,720
about inflation.
And so but there's a problem

459
00:30:40,920 --> 00:30:47,000
these and the problem is scale.
So problem #1 is a data center

460
00:30:47,000 --> 00:30:53,320
is going to require, like in the
case of Port Washington, $170

461
00:30:53,320 --> 00:30:56,760
million worth of public
infrastructure to support the

462
00:30:56,760 --> 00:31:01,520
parcel.
Well, Port Washington's general

463
00:31:01,520 --> 00:31:05,600
fund property tax levy is $4
million a year.

464
00:31:06,200 --> 00:31:10,200
So no bank is going to say,
yeah, sure, 170 where do I sign?

465
00:31:11,120 --> 00:31:16,560
No problem.
So the deal then turned into,

466
00:31:16,560 --> 00:31:23,200
OK, we, we Vantage, the
developer in this case, are

467
00:31:23,200 --> 00:31:26,360
going to front the 170 million.
We'll pay for it.

468
00:31:27,080 --> 00:31:32,200
But you guys in Port Washington
have to pay us back by giving

469
00:31:32,200 --> 00:31:36,280
U.S. tax breaks.
So that thing is another state

470
00:31:36,280 --> 00:31:39,240
law called tax increment
financing, which you should

471
00:31:39,240 --> 00:31:45,880
learn all about because it's the
key to lots of what's going on

472
00:31:45,880 --> 00:31:48,920
here.
All three data center projects

473
00:31:48,920 --> 00:31:54,640
use this financing mechanism.
The tax increment financing is a

474
00:31:54,640 --> 00:32:01,600
tool that the state offers to
municipalities to incentivize

475
00:32:01,640 --> 00:32:05,960
developers to do development in
their communities, to encourage

476
00:32:05,960 --> 00:32:09,240
development.
And in this case, it allows

477
00:32:09,600 --> 00:32:14,920
Vantage to pay the money upfront
and the community to give them

478
00:32:14,920 --> 00:32:18,760
their property tax back for the
next 20 years to pay off the

479
00:32:18,760 --> 00:32:22,760
$170 million with interest in
this case.

480
00:32:22,760 --> 00:32:27,600
And at the end of 20 years, it's
actually a $455,000,000 price

481
00:32:27,600 --> 00:32:32,320
tag.
And, and then the whole problem

482
00:32:32,320 --> 00:32:37,120
with this is that that ends up
to the tax bill being passed on

483
00:32:37,120 --> 00:32:38,400
to the people who live there,
right?

484
00:32:38,400 --> 00:32:41,600
Well, hang on one more dot to
connect.

485
00:32:42,360 --> 00:32:44,440
So there was still another
problem.

486
00:32:45,360 --> 00:32:48,840
And the the next problem is
there was also a state law that

487
00:32:48,840 --> 00:32:53,200
says you can't have one of these
tax districts that's more than

488
00:32:53,200 --> 00:32:55,920
12% of the total size of the
city.

489
00:32:56,560 --> 00:32:59,480
And then back to my financial
concentration risk, Port

490
00:32:59,480 --> 00:33:04,200
Washington's is 50%.
It's going to double the oh,

491
00:33:04,200 --> 00:33:06,760
it's actually 100%.
So it's going to double the

492
00:33:06,760 --> 00:33:09,200
valuation of the city.
It's huge.

493
00:33:10,440 --> 00:33:13,600
Yeah, that much so there.
There's this.

494
00:33:13,600 --> 00:33:18,280
It's called the 12% rule.
And Port Washington Beaver Dam

495
00:33:18,280 --> 00:33:22,760
both had this problem.
And they got the legislature in

496
00:33:22,960 --> 00:33:27,840
a stunning show of
bipartisanship like you've never

497
00:33:27,840 --> 00:33:31,400
seen.
They they honest to God, this

498
00:33:31,400 --> 00:33:33,720
was the most lopsided vote I've
ever seen.

499
00:33:33,720 --> 00:33:37,600
They they would, I joked the
other night if they passed a law

500
00:33:37,600 --> 00:33:40,240
that said the Packers are the
state team, it would probably be

501
00:33:40,240 --> 00:33:44,120
a little more lopsided, but but
this was as pretty much as close

502
00:33:44,120 --> 00:33:48,240
to that as you can get,
something like 93 to 6 in the

503
00:33:48,240 --> 00:33:51,080
assembly.
That never happens.

504
00:33:51,560 --> 00:33:54,080
So they gave an exemption to
both of them so they could

505
00:33:54,080 --> 00:33:58,160
proceed.
So, So now you have well, we

506
00:33:58,160 --> 00:34:02,320
solved the problem of net new
construction, but then we had to

507
00:34:02,320 --> 00:34:05,640
solve the problem of paying
Vantage back for fronting the

508
00:34:05,640 --> 00:34:09,040
money and then we had to solve
for the 12% problem.

509
00:34:09,040 --> 00:34:13,679
Now we have all our problems
solved, but all along the way

510
00:34:14,159 --> 00:34:18,960
they've neglected to make sure
that they were actually solving

511
00:34:18,960 --> 00:34:22,520
some problem that they set out
to solve, which was to be able

512
00:34:22,520 --> 00:34:26,280
to increase the levy so they
could keep up with inflation,

513
00:34:26,280 --> 00:34:29,120
provide more services to
residents, etcetera.

514
00:34:29,639 --> 00:34:34,040
And that's where the tax
increment finance law comes back

515
00:34:34,040 --> 00:34:38,000
into play and creates an
unsolvable problem for these

516
00:34:38,400 --> 00:34:43,480
three communities that are that
have these projects underway.

517
00:34:43,679 --> 00:34:47,400
And that is, I'm sorry to get
really into the weeds on this,

518
00:34:47,719 --> 00:34:52,440
but with tax increment
financing, you remember that I

519
00:34:52,440 --> 00:34:57,520
said your net new construction
number, your new construction

520
00:34:57,520 --> 00:35:00,120
number divided by your total
valuation is called that new

521
00:35:00,120 --> 00:35:01,800
construction.
And that's the percentage that

522
00:35:01,800 --> 00:35:05,360
you can raise the levy.
Well, the nuance that really

523
00:35:05,360 --> 00:35:10,200
harms these projects is when you
have a tax increment district,

524
00:35:10,720 --> 00:35:16,640
your tax payments are stuck
inside that thing paying for in

525
00:35:16,960 --> 00:35:19,280
Port Washington's case, paying
back vantage for the

526
00:35:19,280 --> 00:35:22,800
infrastructure work.
But the new construction comes

527
00:35:22,800 --> 00:35:28,720
out as it happens.
So when when Mount Pleasant got

528
00:35:28,720 --> 00:35:32,280
their first Microsoft building
on the tax rolls, it was a

529
00:35:32,280 --> 00:35:35,720
billion dollar building and
their new construction

530
00:35:35,720 --> 00:35:41,400
calculation was 17%.
And when So Mount Pleasant had a

531
00:35:41,400 --> 00:35:45,880
decision to make, I can raise
the levy 17%, but that guy

532
00:35:46,240 --> 00:35:49,760
Microsoft is stuck in the tax
increment district paying taxes

533
00:35:50,040 --> 00:35:52,480
there.
They're not contributing to

534
00:35:52,480 --> 00:35:57,360
whatever I raised the levy.
So your, your levy increase only

535
00:35:57,360 --> 00:36:00,360
hits the current residence if
you raise the levy.

536
00:36:01,240 --> 00:36:05,080
Now imagine you walk up and down
the streets of Mount Pleasant or

537
00:36:05,080 --> 00:36:08,200
Port Washington or Beaver Dam
and you say, how would you,

538
00:36:08,640 --> 00:36:11,360
would you be in favor of this
data center if it meant we could

539
00:36:11,360 --> 00:36:16,200
raise your taxes?
They act to even the most pro

540
00:36:16,200 --> 00:36:19,120
development resident would say,
no, no, no, no, no, that's not

541
00:36:19,120 --> 00:36:20,640
what you told us this was going
to do.

542
00:36:21,320 --> 00:36:27,120
But the levy calculation law,
the TID financing laws, the 12%

543
00:36:27,120 --> 00:36:30,680
exception, they've all come
together and coalesced into this

544
00:36:30,840 --> 00:36:38,440
massive problem where these 3
municipalities have a really

545
00:36:38,440 --> 00:36:42,160
difficult decision to make.
Do I raise the levy and tax only

546
00:36:42,160 --> 00:36:45,000
current residents, raise taxes
on only current residents

547
00:36:45,480 --> 00:36:52,000
because of the data centers?
Or do I bypass the opportunity

548
00:36:52,360 --> 00:36:56,320
to take that levy increase and
and give it up forever?

549
00:36:56,520 --> 00:37:00,360
It's use it or lose it.
This the theory being, well, if

550
00:37:00,360 --> 00:37:02,800
you didn't need it now, like you
can't have it later, you need

551
00:37:02,800 --> 00:37:05,320
to, you know, grow later and you
can have it then.

552
00:37:07,600 --> 00:37:15,880
So my opinion based on data
point number one of three is

553
00:37:15,880 --> 00:37:18,400
they did exactly what I expect
them to do, which is to take

554
00:37:18,400 --> 00:37:21,120
some levy increase and not tell
their residents why they were

555
00:37:21,120 --> 00:37:23,000
doing it or how the whole thing
works.

556
00:37:23,800 --> 00:37:27,120
And so that makes me really mad
and I want to go around and tell

557
00:37:27,120 --> 00:37:30,240
everybody I'm home Pleasant.
And by the way, I live in Racine

558
00:37:30,240 --> 00:37:33,160
County.
So the the footprint is so big

559
00:37:33,160 --> 00:37:36,360
that it affects county, county
taxes the same way.

560
00:37:36,680 --> 00:37:39,640
Not quite as much because the
base is bigger for the county

561
00:37:39,640 --> 00:37:43,240
versus just Mount Pleasant.
But my county taxes went up 4%

562
00:37:43,240 --> 00:37:45,640
because of the first Microsoft
data center building.

563
00:37:46,600 --> 00:37:49,400
So 4%.
OK, whatever.

564
00:37:49,400 --> 00:37:54,320
That's, it's sort of borderline
annoying, but Mount Pleasant

565
00:37:54,320 --> 00:37:58,680
raised their general fund levy
8% year over year because of the

566
00:37:58,680 --> 00:38:01,120
data center, because the data
center afforded them the

567
00:38:01,120 --> 00:38:08,040
opportunity to do it.
And I've I think transparency is

568
00:38:08,040 --> 00:38:11,520
what has got everybody irritated
in this whole debate.

569
00:38:11,760 --> 00:38:16,600
And this is another example of
local government not being

570
00:38:16,600 --> 00:38:20,920
transparent with people.
Either they went into these

571
00:38:20,920 --> 00:38:24,160
deals knowing they had a problem
and knowing that they were just

572
00:38:24,160 --> 00:38:28,280
going to try to be silent about
it and not tell people about the

573
00:38:28,280 --> 00:38:31,880
tax problem.
Or they didn't know.

574
00:38:32,200 --> 00:38:37,040
But either one of those is bad.
Yeah, that being, you know,

575
00:38:37,040 --> 00:38:41,560
unaware isn't a justification.
And the the strange thing about

576
00:38:41,560 --> 00:38:43,480
it, well, it's not strange when
you think about the whole

577
00:38:43,480 --> 00:38:48,440
picture, but the the only entity
truly insulated with several

578
00:38:48,440 --> 00:38:52,320
layers are the is the company
that built the data center,

579
00:38:52,440 --> 00:38:55,280
right?
Yeah, they're, they're and, you

580
00:38:55,280 --> 00:38:58,360
know, back, back to the David
and Goliath thing.

581
00:38:58,520 --> 00:39:00,520
They're going to, they have
enough lawyers.

582
00:39:00,520 --> 00:39:03,040
They have more lawyers than you
have budget for your whole

583
00:39:03,040 --> 00:39:06,200
village.
They're going to sign a deal

584
00:39:06,200 --> 00:39:09,240
that protects them.
And I people get mad at big tech

585
00:39:09,240 --> 00:39:12,120
companies.
I worked in big companies my

586
00:39:12,120 --> 00:39:14,680
whole life.
I don't begrudge them for

587
00:39:14,680 --> 00:39:16,480
protecting themselves.
That's what they're supposed to

588
00:39:16,480 --> 00:39:18,040
do.
I don't begrudge them for making

589
00:39:18,040 --> 00:39:19,640
a profit.
That's what they're supposed to

590
00:39:19,640 --> 00:39:21,680
do.
So go to town.

591
00:39:21,920 --> 00:39:25,880
I'm just trying to help small
villages have a fighting chance

592
00:39:26,400 --> 00:39:29,600
at making their own good deals,
and I think they're giving away

593
00:39:29,600 --> 00:39:32,440
the farm way more than they have
to.

594
00:39:32,440 --> 00:39:36,240
I think Port Washington probably
could have negotiated a far

595
00:39:36,240 --> 00:39:39,800
better deal and certainly one
that could have protected their

596
00:39:39,800 --> 00:39:44,600
current residents from tax
increases for the next 20 years

597
00:39:44,920 --> 00:39:47,760
while waiting for those tax
payments to actually come out

598
00:39:47,760 --> 00:39:50,800
and help the city.
I, I think that was possible.

599
00:39:50,800 --> 00:39:53,400
And that's all I'm trying to do
running around the state is

600
00:39:54,120 --> 00:39:57,280
watch out for these problems,
Protect yourself against these

601
00:39:57,280 --> 00:40:00,800
problems because your, your
fixed income senior citizen

602
00:40:00,880 --> 00:40:04,360
can't afford a 20% property tax
increase.

603
00:40:05,080 --> 00:40:08,480
And that's what you're staring
at if you want to get the value

604
00:40:08,480 --> 00:40:10,640
out of it that you're running
around telling everybody that

605
00:40:10,640 --> 00:40:13,520
you're going to get.
It's a really tough sell for

606
00:40:13,520 --> 00:40:17,160
them too because it's future
driven like the the benefits

607
00:40:17,160 --> 00:40:21,640
come looking forward.
It would be bad enough, I think,

608
00:40:21,640 --> 00:40:24,480
to tell people we're going to do
this big project and you're

609
00:40:24,480 --> 00:40:26,680
going to wait 20 years to see
the benefit.

610
00:40:27,280 --> 00:40:29,800
But in the in the intervening 20
years, it's a wash.

611
00:40:30,080 --> 00:40:33,200
That would be bad.
That would be not a good message

612
00:40:33,200 --> 00:40:35,320
to send.
But if you say to them your

613
00:40:35,320 --> 00:40:38,960
taxes are going to rise for the
next 20 years and then in the

614
00:40:38,960 --> 00:40:42,920
21st year they're going to be
cut in half, that's a really

615
00:40:42,920 --> 00:40:47,680
terrible message because because
half of the residents aren't

616
00:40:47,680 --> 00:40:49,240
even going to be there in 20
years.

617
00:40:49,320 --> 00:40:52,720
Yeah.
So, and this is speaking from

618
00:40:52,720 --> 00:40:57,040
the layman's perspective, but
isn't a logical solution before

619
00:40:57,040 --> 00:41:00,040
we get to the other pieces
because they're they're more

620
00:41:00,040 --> 00:41:04,600
negatives, but isn't a logical
solution to have them be on the

621
00:41:04,600 --> 00:41:06,840
hook for the infrastructure that
comes along with it?

622
00:41:06,840 --> 00:41:09,440
Yeah. 100% they should pay their
own way.

623
00:41:10,120 --> 00:41:12,800
And I'll use again another
example in Port Washington,

624
00:41:12,800 --> 00:41:17,480
there's a $90,000,000 electrical
substation in that deal that is

625
00:41:17,480 --> 00:41:22,000
being paid for with tax rebates.
So these data centers again

626
00:41:22,000 --> 00:41:27,120
scale, they're going to consume
more electricity than you've

627
00:41:27,120 --> 00:41:30,600
ever seen.
Even just a handful of them will

628
00:41:30,600 --> 00:41:35,400
double the energy production,
electricity production in the

629
00:41:35,400 --> 00:41:37,360
state.
That's a huge footprint.

630
00:41:37,720 --> 00:41:43,760
So if I'm building a substation
for for the Vantage data center

631
00:41:43,760 --> 00:41:45,720
in Port Washington, that's
great.

632
00:41:45,920 --> 00:41:49,360
I might get somebody else who
sets up shop, like a

633
00:41:49,360 --> 00:41:52,280
manufacturing facility or of
office building or something

634
00:41:52,560 --> 00:41:55,320
nearby that can take advantage
of that substation that's being

635
00:41:55,320 --> 00:41:57,080
built.
But they're only ever going to

636
00:41:57,080 --> 00:42:00,800
use the tiniest fraction of what
electrons are flowing through

637
00:42:00,800 --> 00:42:06,680
that thing.
So why did it make sense for the

638
00:42:07,240 --> 00:42:14,320
taxpayers of the of the city to
refund the building of that

639
00:42:14,320 --> 00:42:20,760
$90,000,000 substation when it's
it's impossible, literally

640
00:42:20,760 --> 00:42:27,760
impossible for there to be
substantive reuse on a kWh

641
00:42:28,080 --> 00:42:32,440
measurement of that substation
that is always going to be

642
00:42:32,680 --> 00:42:37,240
almost exclusively vantage used
terms of capacity.

643
00:42:37,960 --> 00:42:40,360
So, yeah, we should have charged
him.

644
00:42:40,360 --> 00:42:42,720
The whole thing said if you
don't like those terms, then go

645
00:42:42,720 --> 00:42:50,680
find another community.
But back to my, my, what do you

646
00:42:50,680 --> 00:42:54,160
call it?
The the coalescing of all the

647
00:42:54,160 --> 00:42:56,440
state laws that are creating bad
incentives.

648
00:42:56,440 --> 00:42:58,200
The the perfect storm of
incentives.

649
00:42:59,320 --> 00:43:04,040
If you as a state law, say to a
community, the only way you can

650
00:43:04,040 --> 00:43:07,200
raise your levy and pay for
things that you have to pay for,

651
00:43:07,200 --> 00:43:11,360
like raises for police officers
and you tell them the only way

652
00:43:11,360 --> 00:43:13,360
you can do that is with new
construction.

653
00:43:13,960 --> 00:43:16,040
Guess what?
They are going to quote UN

654
00:43:16,040 --> 00:43:20,040
quote, pay any price for that
new construction because it's

655
00:43:20,200 --> 00:43:24,080
essentially their oxygen.
And if if you can't, if you let

656
00:43:24,720 --> 00:43:29,160
inflation just erode your
purchasing power over time, you

657
00:43:29,160 --> 00:43:34,640
get desperate.
And Port Washington's average

658
00:43:35,280 --> 00:43:38,400
growth rate in new construction
for the last eight years is 1

659
00:43:38,400 --> 00:43:41,360
1/2%.
And we just came out of a really

660
00:43:41,360 --> 00:43:46,360
high inflationary period.
And, and that in and of itself

661
00:43:46,480 --> 00:43:51,320
is compounding the the nature of
the desperation.

662
00:43:51,920 --> 00:43:57,840
So you get 10% increases, 8%
increases in inflation, and then

663
00:43:58,240 --> 00:44:02,680
234 consecutive years of that.
And all of a sudden now it

664
00:44:02,680 --> 00:44:05,760
really hurts because you're only
growing at 1 1/2%.

665
00:44:05,760 --> 00:44:09,560
That's all you can do.
And unless you want to go to

666
00:44:09,560 --> 00:44:12,560
referendum and ask people for
more money, which might or might

667
00:44:12,560 --> 00:44:17,360
not work.
If some rich tech company calls

668
00:44:17,360 --> 00:44:19,160
you up and says, have I got a
deal for you?

669
00:44:20,000 --> 00:44:22,320
You're going to answer the
phone, and you're going to

670
00:44:23,240 --> 00:44:26,360
probably try to figure out a way
to make it work, even if it

671
00:44:26,360 --> 00:44:30,080
means convincing yourself of
things that might not be true.

672
00:44:30,640 --> 00:44:32,760
Absolutely.
Yeah, Yeah.

673
00:44:32,840 --> 00:44:36,080
And almost to the point of
desperation where it's this

674
00:44:36,080 --> 00:44:40,880
choice or not, no choice, but no
good choice.

675
00:44:41,400 --> 00:44:42,560
That's really.
Interesting.

676
00:44:42,560 --> 00:44:46,680
It requires, it would have
required a great deal of

677
00:44:46,680 --> 00:44:53,200
self-discipline of of elected
official self-discipline, I

678
00:44:53,200 --> 00:44:57,800
guess as a it is a City Council
or village council to say no to

679
00:44:57,800 --> 00:45:02,400
it because, yeah, it it solves
the problem the legislature told

680
00:45:02,400 --> 00:45:04,960
you you had to solve for in
order to manage your city

681
00:45:04,960 --> 00:45:08,240
appropriately.
Do I do I blame them for making

682
00:45:08,240 --> 00:45:09,080
the decision?
Why?

683
00:45:09,240 --> 00:45:13,240
I do publicly state often that I
think it's a terrible deal that

684
00:45:13,240 --> 00:45:16,360
they signed, but I at least
understand the thought process

685
00:45:16,360 --> 00:45:20,600
that they used to get there.
And I'm I'm glad I wasn't in

686
00:45:20,600 --> 00:45:22,520
their shoes to have to make that
decision.

687
00:45:24,080 --> 00:45:28,080
But at least mathematically, I
think they signed a terrible

688
00:45:28,080 --> 00:45:31,240
deal that they can't get value
out of without harming current

689
00:45:31,240 --> 00:45:33,760
residents.
And I so I think it's flawed and

690
00:45:33,760 --> 00:45:37,200
fatally so, unless the
legislature comes along and

691
00:45:37,200 --> 00:45:39,800
rescues them with some change
that allows them to get the

692
00:45:39,800 --> 00:45:42,520
value out at least at the end.
That was going to be my next

693
00:45:42,520 --> 00:45:44,120
question.
Has there any been, has there

694
00:45:44,120 --> 00:45:45,920
been any conversation around
that?

695
00:45:45,920 --> 00:45:48,000
Because it seems like that's the
path out.

696
00:45:48,960 --> 00:45:54,560
Well, that's the that's the
party line from the from the

697
00:45:54,560 --> 00:45:59,600
City Council in Port Washington.
I haven't seen any bills that

698
00:45:59,600 --> 00:46:03,640
address it.
I haven't heard any legislator

699
00:46:03,640 --> 00:46:07,320
say anything about it.
I've just heard people say we're

700
00:46:07,320 --> 00:46:10,480
working on it.
People not in the legislature,

701
00:46:10,520 --> 00:46:12,160
legislature saying we're working
on it.

702
00:46:13,040 --> 00:46:16,360
It's an election year.
So I have almost 0 hope that

703
00:46:16,360 --> 00:46:20,960
anything will happen soon but
there will be non election years

704
00:46:20,960 --> 00:46:24,000
that maybe maybe something will
happen.

705
00:46:24,520 --> 00:46:27,840
I don't wish for Port Washington
or Beaver dams failure.

706
00:46:27,840 --> 00:46:29,840
I'd really like their residents
not to get screwed.

707
00:46:30,760 --> 00:46:33,360
I'd love to see the legislature
fix this problem.

708
00:46:34,680 --> 00:46:39,120
I also fear that the legislature
will break it worse if they try

709
00:46:39,120 --> 00:46:41,160
to fix it.
So they we should be really

710
00:46:41,160 --> 00:46:45,840
careful in in guiding them to
the right answer.

711
00:46:46,480 --> 00:46:49,920
Yeah, absolutely.
So there was one piece in there

712
00:46:49,920 --> 00:46:53,360
that I'd like to delve a little
bit deeper on specifically and

713
00:46:53,360 --> 00:46:57,280
maybe it's a bridge to like some
of the extractive nature or what

714
00:46:57,280 --> 00:47:00,560
they extractive situation you
would call it.

715
00:47:01,040 --> 00:47:05,440
But the it's the art.
Hasn't there been some

716
00:47:05,880 --> 00:47:12,040
insulation as well that's going
to pass rise in power prices on

717
00:47:12,040 --> 00:47:17,160
to local folks as compared to
like at a disproportionate level

718
00:47:17,480 --> 00:47:21,600
to the then the company gets?
So the proposal that's on the

719
00:47:21,600 --> 00:47:28,240
table right now from We Energies
is for customers are using more

720
00:47:28,240 --> 00:47:33,520
than 500 megawatts of power.
They go into a separate rate

721
00:47:33,520 --> 00:47:38,720
class and that rate class has to
pay 75% of the construction

722
00:47:38,720 --> 00:47:42,160
costs associated with whatever
infrastructure they're building

723
00:47:42,160 --> 00:47:47,200
for them and 100% of the power
generation costs, the fuel

724
00:47:47,200 --> 00:47:52,400
costs.
So the theory on the 7525 is,

725
00:47:52,400 --> 00:47:56,680
well, it's a shared, I'm
guessing the, the theory is that

726
00:47:56,680 --> 00:48:01,000
it's a shared infrastructure and
building infrastructure benefits

727
00:48:01,000 --> 00:48:05,720
everybody will make the big
users pay 75% of it.

728
00:48:05,720 --> 00:48:10,080
Sounds like a good number and
we'll share the 25% cost with

729
00:48:10,080 --> 00:48:13,600
everybody else because everybody
else gets some benefit out of

730
00:48:14,520 --> 00:48:15,800
it.
Back to that electrical

731
00:48:15,800 --> 00:48:17,880
substation thing.
And who's paying for that?

732
00:48:17,880 --> 00:48:20,040
It's sort of the same thing.
Well, you're doubling the

733
00:48:20,040 --> 00:48:24,320
capacity of of the
infrastructure here to support

734
00:48:24,320 --> 00:48:26,920
these data centers.
They should be paying 100% of

735
00:48:26,920 --> 00:48:28,920
the doubling.
It.

736
00:48:29,080 --> 00:48:34,320
It, it seems tone deaf to me to
even try to propose 75%, right?

737
00:48:34,840 --> 00:48:38,400
I don't know why it wouldn't be
100, but I have a bigger problem

738
00:48:38,400 --> 00:48:41,920
with the whole energy price
debate.

739
00:48:42,080 --> 00:48:45,200
And not that I am not
sympathetic, I am very

740
00:48:45,200 --> 00:48:49,200
sympathetic to the argument that
energy costs to the consumer

741
00:48:49,200 --> 00:48:54,160
will go up.
But just as a in the rearview

742
00:48:54,160 --> 00:48:58,560
mirror, we should understand
costs, cost increases or

743
00:48:58,560 --> 00:49:00,440
decreases.
We should understand that better

744
00:49:00,440 --> 00:49:02,800
in the rearview mirror than we
can predict in the future,

745
00:49:03,160 --> 00:49:03,880
Right?
Simple.

746
00:49:04,800 --> 00:49:12,040
So between I think it was 24 to
25 or maybe 23 to 24 before any

747
00:49:12,040 --> 00:49:16,560
large scale data center goes
online, our electricity rates

748
00:49:16,560 --> 00:49:21,240
went up 8%.
So why do we have agreement on

749
00:49:21,240 --> 00:49:23,680
that?
Can anybody explain that to us

750
00:49:24,480 --> 00:49:28,520
in the rearview mirror?
We cannot explain with any

751
00:49:28,520 --> 00:49:33,720
amount of certainty that would
have, say, 85% of the people in

752
00:49:33,720 --> 00:49:37,800
the state agreeing or even 85%
of the experts who know this

753
00:49:37,800 --> 00:49:41,000
field.
Nobody can tell us exactly why

754
00:49:41,000 --> 00:49:45,960
our energy rates went up 8%.
They they can give you a story,

755
00:49:46,680 --> 00:49:49,960
but nobody can sit down with you
with a spreadsheet and say,

756
00:49:49,960 --> 00:49:52,640
here, look, This is why.
They're just blanketly pointed

757
00:49:52,640 --> 00:49:54,960
inflation.
Well, they'll they'll point at a

758
00:49:54,960 --> 00:49:58,280
lot of things because in
fairness to them, it's a multi

759
00:49:58,280 --> 00:49:59,720
variable problem.
Absolutely.

760
00:49:59,720 --> 00:50:02,400
It is massively complicated
infrastructure.

761
00:50:03,040 --> 00:50:06,880
There are many, many very
complex variables and systems

762
00:50:06,880 --> 00:50:12,680
involved and it's really hard to
do so now look at the problem

763
00:50:12,960 --> 00:50:16,280
going forward and say you're the
person that has to come up with

764
00:50:16,280 --> 00:50:21,280
the price tag for for whomever
Microsoft or Vantage or

765
00:50:21,280 --> 00:50:24,040
whatever.
How do you calculate what we

766
00:50:24,040 --> 00:50:29,400
charge them?
And the whole system is set up

767
00:50:29,760 --> 00:50:34,000
because it has to be that they
have to come up with educated

768
00:50:34,880 --> 00:50:39,440
algorithms about how to
calculate their bill and if they

769
00:50:39,440 --> 00:50:42,800
underestimate then the rate
payer base is going to absorb

770
00:50:42,800 --> 00:50:44,160
the rest.
Right.

771
00:50:44,800 --> 00:50:46,080
I mean, it just has to work that
way.

772
00:50:47,040 --> 00:50:52,520
So I think the whole model is
built on trust me.

773
00:50:53,560 --> 00:50:55,800
And if you want to get really
snarky, you can add bro to the

774
00:50:55,800 --> 00:50:59,480
end of that trust.
Trust me, bro, I know, I know

775
00:50:59,480 --> 00:51:03,320
how to, I'm the, I'm the energy
guy at wherever we energies and

776
00:51:03,320 --> 00:51:06,720
I, you know, I've got my
spreadsheets in the back and big

777
00:51:06,720 --> 00:51:08,880
huge programs that calculate all
this.

778
00:51:08,880 --> 00:51:13,600
And you know, we, we, we can
charge them for their

779
00:51:13,600 --> 00:51:19,840
infrastructure.
Well, I've worked in a similar

780
00:51:19,840 --> 00:51:24,400
environment with a shared large
computing infrastructure that

781
00:51:24,400 --> 00:51:29,120
supported multiple businesses.
And I had to allocate those

782
00:51:29,120 --> 00:51:33,720
costs to those businesses.
And, and then they would call me

783
00:51:33,720 --> 00:51:36,640
and ask me why I allocated that
number.

784
00:51:36,640 --> 00:51:40,560
And I would say, trust me, bro,
because it's an art, not a

785
00:51:40,560 --> 00:51:45,360
science, right?
And, and if I, I would always

786
00:51:45,360 --> 00:51:50,480
have leftover costs because the
algorithm's never perfect and

787
00:51:50,480 --> 00:51:52,160
that leftover cost just gets
spread.

788
00:51:53,520 --> 00:51:55,400
And I, you know, you have to
spread it somehow.

789
00:51:55,400 --> 00:51:58,440
I'll spread it based on your
revenue or I'll spread it based

790
00:51:58,440 --> 00:52:02,560
on the number of programs you
run or what I whatever make up

791
00:52:02,560 --> 00:52:06,840
something.
So I think the model in energy

792
00:52:06,840 --> 00:52:09,520
is essentially the same.
It's, yeah, it's a complicated

793
00:52:09,520 --> 00:52:12,240
shared infrastructure, and it's
really hard to calculate

794
00:52:12,520 --> 00:52:17,240
accurately, particularly looking
into the future, it's really

795
00:52:17,240 --> 00:52:22,360
hard to calculate how much
infrastructure somebody has had

796
00:52:22,360 --> 00:52:25,080
built for them.
We're invariably going to leave,

797
00:52:25,240 --> 00:52:28,720
leave things out that end up
having to just hit the base

798
00:52:30,320 --> 00:52:32,080
because it's an art, not a
science.

799
00:52:32,240 --> 00:52:38,960
And I would ask if I were king
for the day, I would ask for

800
00:52:38,960 --> 00:52:41,120
just more transparency into the
calculations.

801
00:52:41,120 --> 00:52:49,360
Show your work, my field.
Very interesting to mention to

802
00:52:49,360 --> 00:52:51,200
it was all of our work was in
the open.

803
00:52:51,240 --> 00:52:56,160
You work in a team, you check
your software into a repository

804
00:52:56,160 --> 00:52:59,200
that's open to the whole team.
People can see what lines of

805
00:52:59,200 --> 00:53:02,480
code you changed and if it's two
in the morning and you're you

806
00:53:02,480 --> 00:53:05,240
got paged because something
broke, you know you know who did

807
00:53:05,240 --> 00:53:06,480
it and you can yell at it in the
morning.

808
00:53:07,080 --> 00:53:10,200
Working in that kind of open,
fully transparent environment

809
00:53:10,200 --> 00:53:13,240
can be very unsettling to
people, but it's also, it also

810
00:53:13,240 --> 00:53:15,080
produces a far better work
product.

811
00:53:16,040 --> 00:53:22,600
And I, I think we don't ask for
enough transparency on that

812
00:53:22,600 --> 00:53:25,000
issue.
But I think in in general across

813
00:53:25,000 --> 00:53:28,560
all of the space that the whole
issue, there's just so much more

814
00:53:28,560 --> 00:53:31,360
transparency that we should be
demanding.

815
00:53:31,800 --> 00:53:33,640
It would produce a better work
product.

816
00:53:34,080 --> 00:53:38,200
Absolutely.
And you know, with with that,

817
00:53:38,560 --> 00:53:40,960
you know, transparency and
ultimate end product kind of the

818
00:53:40,960 --> 00:53:48,840
path there is it, it shifts the
the accountability within it

819
00:53:49,000 --> 00:53:55,200
because then you know, it's just
the layers of justification that

820
00:53:55,200 --> 00:53:58,600
lead to that lead to the end.
Like there's a trail that got to

821
00:53:58,600 --> 00:54:03,280
where you go.
And so is there a layer to this

822
00:54:03,640 --> 00:54:11,120
that where does, where does the
energy producer live inside of

823
00:54:11,120 --> 00:54:13,760
the deal like the initial deal,
where is that?

824
00:54:13,760 --> 00:54:18,080
That's a, that's actually a
problem, not a problem.

825
00:54:18,200 --> 00:54:25,480
It's a, it's a attribute of this
that can be frustrating because

826
00:54:25,760 --> 00:54:28,240
we ran into this with, with
ours.

827
00:54:30,040 --> 00:54:32,120
You, you have this proposal on
the table.

828
00:54:32,120 --> 00:54:36,360
And one of the common criticisms
that you want to bring to your

829
00:54:36,360 --> 00:54:39,360
village officials is I don't
want my energy rates to go up

830
00:54:40,160 --> 00:54:42,120
and they turn around and say not
my job.

831
00:54:42,840 --> 00:54:44,920
I, I, I don't know squat about
energy.

832
00:54:44,920 --> 00:54:48,760
That's the PS CS problem, Public
Service Commission's problem,

833
00:54:48,760 --> 00:54:50,720
that's the energy company's
problem.

834
00:54:51,200 --> 00:54:56,200
The energy company is making a
deal separately with each of the

835
00:54:56,200 --> 00:55:00,600
providers, I mean, each of the
data center, the developers and

836
00:55:01,000 --> 00:55:05,520
the people approving the deal
that you may or may not be

837
00:55:05,520 --> 00:55:08,240
trying to resist.
They're village officials.

838
00:55:08,240 --> 00:55:10,560
They don't know this energy
space at all.

839
00:55:10,760 --> 00:55:16,240
And the argument about energy in
my view is not, it's not

840
00:55:16,240 --> 00:55:18,120
effective.
It might be valid.

841
00:55:18,160 --> 00:55:21,200
In fact, I I know it's a valid
topic of conversation and

842
00:55:21,200 --> 00:55:26,440
debate, but it's not going to
change a mind on a village

843
00:55:26,440 --> 00:55:29,120
board.
I don't think because they're

844
00:55:29,120 --> 00:55:31,600
not expertise that they don't
have the expertise and they

845
00:55:31,600 --> 00:55:35,640
don't, they don't have any
choice really but to take the

846
00:55:35,640 --> 00:55:39,120
advice of the experts, which are
the energy company and the

847
00:55:39,120 --> 00:55:42,000
Public Service Commission.
And taking into account the

848
00:55:42,000 --> 00:55:45,960
resources of both sides, that
brings me a little on comfort.

849
00:55:46,400 --> 00:55:50,800
Like with that deal being there,
you're completely the the the

850
00:55:50,800 --> 00:55:54,400
residents of the community are
completely removed from it even.

851
00:55:54,640 --> 00:55:56,880
Yeah, you.
Through their representatives.

852
00:55:56,920 --> 00:56:01,440
Well, yeah, there's a There's
another thread here about how

853
00:56:01,440 --> 00:56:04,280
the deck is stacked against
normal people even.

854
00:56:04,280 --> 00:56:09,560
Just try and navigate either the
the tariff deal for the electric

855
00:56:09,560 --> 00:56:13,720
company or the vote at the
village board with with the

856
00:56:14,320 --> 00:56:18,040
Public Service Commission.
As a citizen, you can submit

857
00:56:18,040 --> 00:56:21,400
comments.
Sometimes there are public

858
00:56:21,400 --> 00:56:25,600
hearings where you can actually
show up and rant, rave, but you

859
00:56:25,600 --> 00:56:28,440
know you're limited to whatever
2 to 3 minutes and make your

860
00:56:28,440 --> 00:56:32,280
case and then go sit down and
hope people listen to you.

861
00:56:32,800 --> 00:56:37,120
And it's not it's usually not a
coordinated message.

862
00:56:37,240 --> 00:56:40,920
It's individuals coming up and
saying I think you're going to

863
00:56:40,920 --> 00:56:45,400
RIP me off.
And it's it's a really hard,

864
00:56:46,760 --> 00:56:50,840
it's a really hard decision to
impose any kind of community

865
00:56:50,840 --> 00:56:54,240
will against.
Likewise, on a village side,

866
00:56:54,760 --> 00:57:00,480
there's a huge problem there
with the process by which these

867
00:57:00,480 --> 00:57:04,760
things are happening.
We ran into this headlong.

868
00:57:06,240 --> 00:57:08,800
We did not have any non
disclosure agreements signed,

869
00:57:09,480 --> 00:57:13,280
but you don't, which is another
interesting thread we should

870
00:57:13,280 --> 00:57:16,440
talk about.
But even absent a non disclosure

871
00:57:16,440 --> 00:57:19,600
agreement, there's nothing
compelling your village to tell

872
00:57:19,600 --> 00:57:21,960
you.
Hey, I just got a call from a

873
00:57:21,960 --> 00:57:24,320
data center company and they
they want to talk about a

874
00:57:24,320 --> 00:57:27,760
proposal to build 1 here and and
they're not going to do that.

875
00:57:28,680 --> 00:57:31,920
They're going to and maybe they
shouldn't, maybe they should

876
00:57:31,920 --> 00:57:35,840
take the call and start having
discussions at some point.

877
00:57:36,480 --> 00:57:39,840
My opinion, they should say,
yeah, this is a pretty big deal.

878
00:57:40,240 --> 00:57:43,240
Maybe we should alert the
community and start a dialogue

879
00:57:43,240 --> 00:57:47,720
with them and try to get their
feedback, maybe even some of

880
00:57:47,720 --> 00:57:50,720
their expertise if we have that.
They don't do that either.

881
00:57:51,280 --> 00:57:55,720
They they carry on through the
discussions with the tech

882
00:57:55,720 --> 00:58:00,320
companies and they get to an
almost baked or even baked and

883
00:58:00,320 --> 00:58:04,960
ready to vote on proposal.
And then they let you know that

884
00:58:04,960 --> 00:58:11,000
it's there and then you're six
weeks away from a vote and

885
00:58:11,400 --> 00:58:12,880
you're six weeks away from a
vote.

886
00:58:13,240 --> 00:58:17,600
You We got lucky and we saw a
rezoning sign in the tall grass

887
00:58:17,600 --> 00:58:20,840
on a lonely road and somebody.
That's how you found out.

888
00:58:21,360 --> 00:58:25,240
And, and there's also a
requirement that they in our

889
00:58:25,240 --> 00:58:28,640
village that they notify people
within 300 feet of the property,

890
00:58:29,160 --> 00:58:33,120
which is, and it's a very low
density residential area.

891
00:58:33,120 --> 00:58:37,600
So that means across the street
there, there might have been, I

892
00:58:37,600 --> 00:58:40,440
don't know, 20 or 30 homes.
I got a letter in the mail

893
00:58:40,440 --> 00:58:45,720
saying there's a rezoning.
And so we got lucky that a

894
00:58:45,720 --> 00:58:48,600
couple, I think it was four or
five people actually called and

895
00:58:48,600 --> 00:58:51,360
said, what's up with this?
And they found out it was a data

896
00:58:51,360 --> 00:58:54,840
center.
But you're on a six week clock

897
00:58:54,840 --> 00:58:59,920
here and you have to bring a
community group together who's

898
00:58:59,920 --> 00:59:02,800
never worked with each other,
who might not know anything

899
00:59:02,880 --> 00:59:04,440
about data centers.
They probably don't know

900
00:59:04,440 --> 00:59:07,520
anything about even their own
expertise is in the group.

901
00:59:08,320 --> 00:59:11,920
You, you have to find the right
leaders, You have to find the

902
00:59:11,920 --> 00:59:14,800
right message.
You have to put a communication

903
00:59:14,800 --> 00:59:19,160
strategy together.
You have to get the community

904
00:59:19,160 --> 00:59:22,960
engaged on the topic because 99
1/2% of them don't even know

905
00:59:22,960 --> 00:59:26,920
what's happening.
And all the while the foot is on

906
00:59:26,920 --> 00:59:30,240
the gas, going 100 miles an hour
to that boat.

907
00:59:31,120 --> 00:59:34,960
And when I look back on it, I
say, how on earth did we win?

908
00:59:35,240 --> 00:59:37,520
I know it sounds impossible.
It sounds impossible.

909
00:59:37,520 --> 00:59:42,800
And, and if you have an eager
well funded developer and you

910
00:59:42,800 --> 00:59:44,920
have an eager City Council who's
trying to solve their

911
00:59:44,920 --> 00:59:49,800
construction number problem and
you have six weeks on the clock,

912
00:59:49,920 --> 00:59:53,080
it's like it's practically
impossible to to win.

913
00:59:53,800 --> 00:59:58,280
So I think that's why our story
was so special in the news and

914
00:59:58,280 --> 01:00:00,720
got so many people calling and
saying, how the heck did you do

915
01:00:00,720 --> 01:00:03,720
that?
But the deck is stacked against

916
01:00:03,720 --> 01:00:05,440
people.
And, and when you show up,

917
01:00:06,080 --> 01:00:09,080
there's open comment at public
meetings where you can get up

918
01:00:09,080 --> 01:00:12,000
and speak your piece, but you
get 2 minutes.

919
01:00:13,600 --> 01:00:17,200
So I'm, I'm going to give you my
38 years worth of technology

920
01:00:17,200 --> 01:00:20,280
experience and financial
services industry experience.

921
01:00:20,920 --> 01:00:22,880
And I get 2 minutes.
I'm going to have to talk really

922
01:00:22,880 --> 01:00:25,800
fast to tell you my list of
things.

923
01:00:26,520 --> 01:00:32,440
So we had this just as an aside.
Our strategy was, I'm going to

924
01:00:32,440 --> 01:00:38,080
write the top 20 issues in
two-minute increments and then

925
01:00:38,920 --> 01:00:43,160
we're going to get a group of
people to agree to read them two

926
01:00:43,160 --> 01:00:46,400
minutes at a time back-to-back
to back so that we could get a

927
01:00:46,400 --> 01:00:49,840
20 minute speech out.
That was strategy one.

928
01:00:50,120 --> 01:00:55,320
Strategy 2 was we're, we have 7
people whose boats were trying

929
01:00:55,320 --> 01:01:00,240
to sway and we know their names.
We can find out who they are,

930
01:01:00,240 --> 01:01:02,680
what they did for a living, what
makes them tick, what, what

931
01:01:02,680 --> 01:01:05,080
analogies might work with them
if we're trying to explain

932
01:01:05,080 --> 01:01:08,200
something complex.
And we put a very targeted

933
01:01:08,200 --> 01:01:13,160
strategy together to go 1 by 1
by 1 to try to talk to them as

934
01:01:13,280 --> 01:01:16,760
humans.
And but again, pedal to the

935
01:01:16,760 --> 01:01:18,760
metal, you have six weeks to do
it.

936
01:01:18,760 --> 01:01:22,320
And it got really dicey and
scary right up until the last

937
01:01:22,320 --> 01:01:27,760
minute and but it worked.
But if you don't, if you don't

938
01:01:27,760 --> 01:01:31,920
have that kind of quickly
coalescing community group and

939
01:01:32,120 --> 01:01:35,880
experience doing one of the
hardest things in the world,

940
01:01:35,880 --> 01:01:40,120
which is to change someone's
mind, you will fail.

941
01:01:41,280 --> 01:01:44,160
Yeah.
And immediately my mind goes to

942
01:01:44,400 --> 01:01:48,840
like that was kind of the
perfect storm of subject matter

943
01:01:48,840 --> 01:01:53,600
expertise you found out.
So awareness and then the

944
01:01:54,240 --> 01:01:57,320
ability then to move forward
with organizing very quickly.

945
01:01:58,080 --> 01:02:02,520
If I put my mind in the other
side of the shoes that it seems

946
01:02:02,520 --> 01:02:05,960
like the very logical next step
is to target different

947
01:02:06,280 --> 01:02:10,400
geographic areas that aren't
going to have the similar

948
01:02:10,400 --> 01:02:12,920
resources.
So like, you know, and the

949
01:02:14,160 --> 01:02:18,800
community that's not thriving or
an underserved neighborhood or

950
01:02:18,800 --> 01:02:24,240
something like that where
there's even less tools in the

951
01:02:24,240 --> 01:02:27,520
tool belt for the next project
in the next project in the next

952
01:02:27,520 --> 01:02:28,840
project.
You get what I'm getting at.

953
01:02:28,840 --> 01:02:34,360
It seems like an endless rabbit
hole of, OK, the, you know, kind

954
01:02:34,360 --> 01:02:38,160
of these ones fought back.
Let's try here because the

955
01:02:38,160 --> 01:02:40,880
population is different that
might have the same tools.

956
01:02:41,480 --> 01:02:46,160
Absolutely.
I think there's there's a fair

957
01:02:47,760 --> 01:02:53,240
debate about whether the the
tech companies are purposely

958
01:02:53,240 --> 01:02:55,800
targeting smaller communities or
not.

959
01:02:56,960 --> 01:03:01,520
I, I tend to not think they are
doing it purposely.

960
01:03:01,960 --> 01:03:09,040
I I think maybe I'm naive.
In fact many people say I am

961
01:03:09,040 --> 01:03:10,640
naive for that belief, but
that's OK.

962
01:03:11,880 --> 01:03:15,720
I think their number one
priority is proximity to power.

963
01:03:17,040 --> 01:03:22,560
That that is if you, I found a
map of a high voltage

964
01:03:22,560 --> 01:03:26,200
transmission lines in the state
and if you drop a pin on all of

965
01:03:26,200 --> 01:03:31,840
the proposals, they are all
right on top of the the highest

966
01:03:31,840 --> 01:03:34,240
voltage lines.
And some of you know some of

967
01:03:34,240 --> 01:03:36,520
them might need upgrading and
might, might need new stuff.

968
01:03:36,520 --> 01:03:41,960
But the closer they are to power
the, the less their build costs

969
01:03:41,960 --> 01:03:45,800
are going to be.
And it's the single biggest

970
01:03:45,800 --> 01:03:49,280
thing that they need so #2 is
space.

971
01:03:49,360 --> 01:03:51,160
They have to have a ton of
space.

972
01:03:51,800 --> 01:03:56,760
So I think because of priority
one and priority two, they they

973
01:03:56,760 --> 01:04:00,760
default to smaller communities
because they can find a small

974
01:04:00,760 --> 01:04:04,840
community near power lines and
they certainly the only place

975
01:04:04,840 --> 01:04:08,600
they can find say 600 or 1000
acres of contiguous spaces in a

976
01:04:08,600 --> 01:04:14,040
small community.
So I think it's just a

977
01:04:14,680 --> 01:04:19,760
accidental benefit to them that
that's the type of community

978
01:04:19,760 --> 01:04:23,600
that fits their model.
And Gee, it's convenient that

979
01:04:23,600 --> 01:04:26,200
they don't know how to negotiate
with a Fortune 100 company.

980
01:04:26,880 --> 01:04:31,680
I don't think it's sinister,
some people do, but I I will

981
01:04:31,680 --> 01:04:36,280
continue to think, think the
best of people that rather than

982
01:04:36,280 --> 01:04:37,560
the worst.
Yeah.

983
01:04:37,880 --> 01:04:40,120
Well, you have a very unique
lens of it too with where your

984
01:04:40,120 --> 01:04:43,200
career path had taken you in the
decisions that you had to make

985
01:04:43,200 --> 01:04:46,880
throughout the years.
You can more easily put yourself

986
01:04:46,880 --> 01:04:49,760
in the shoes of the other side.
Then I think some other

987
01:04:49,760 --> 01:04:52,400
thoughts.
And that's great that that's

988
01:04:52,400 --> 01:04:55,840
very good because I mean,
there's certainly a disparity

989
01:04:55,840 --> 01:04:57,200
there too.
I'm sure you ran into your

990
01:04:57,200 --> 01:05:00,560
career, made decisions of that
were founded in logic and

991
01:05:00,560 --> 01:05:04,880
reasoning, but were pushed back
against in scenarios that didn't

992
01:05:04,880 --> 01:05:09,160
call for it kind of along those
lines adjacent to it anyway.

993
01:05:09,920 --> 01:05:14,720
What, how, how like much did you
delve into the other

994
01:05:14,720 --> 01:05:17,960
extractionary piece of the the
water concerns?

995
01:05:17,960 --> 01:05:23,240
Is that something that you kind
of include or researched or?

996
01:05:23,600 --> 01:05:30,520
So I did enough research on
water to know that one it wasn't

997
01:05:30,600 --> 01:05:35,320
that argument wasn't going to
move any of our seven votes, OK,

998
01:05:35,320 --> 01:05:40,120
The the industry believes it
solved the water usage problem

999
01:05:40,320 --> 01:05:43,280
with closed loop systems.
The reuse, yeah, there's still

1000
01:05:43,280 --> 01:05:46,760
some open questions about
chemicals they put in it and

1001
01:05:46,840 --> 01:05:50,640
where they're going to take the
used water when they're done

1002
01:05:50,640 --> 01:05:53,600
with it and how often they're
going to have to remove the

1003
01:05:53,600 --> 01:05:56,520
water and put it someplace else.
There's still plenty of open

1004
01:05:56,520 --> 01:06:02,280
questions there.
But the the industry is telling

1005
01:06:02,280 --> 01:06:04,320
people we've solved this
problem.

1006
01:06:04,320 --> 01:06:07,280
We heard you.
We're not going to be water hogs

1007
01:06:07,280 --> 01:06:09,760
anymore.
The flip side is they're going

1008
01:06:09,760 --> 01:06:12,600
to use more energy because, you
know, there's no free lunch.

1009
01:06:13,160 --> 01:06:15,920
So we'll use less water to cool,
but we'll have to use more

1010
01:06:15,920 --> 01:06:19,920
energy to cool instead.
And so the debate shifts to

1011
01:06:19,920 --> 01:06:21,840
energy.
And then the energy problem has

1012
01:06:21,840 --> 01:06:24,640
that probably we talked about
before, which is it's a decision

1013
01:06:24,640 --> 01:06:27,360
somebody else makes, not the
decision makers in your village.

1014
01:06:28,640 --> 01:06:36,240
But my interesting spin on the
water problem is that's an

1015
01:06:36,240 --> 01:06:38,760
example of how fast the industry
changes.

1016
01:06:40,200 --> 01:06:44,280
And you can't have it both ways.
Like you can't tell me this is a

1017
01:06:44,280 --> 01:06:46,640
really stable asset in your
community and it's going to

1018
01:06:46,640 --> 01:06:50,720
produce lots of tax revenue
forever and ever when five years

1019
01:06:50,720 --> 01:06:54,720
ago there was no such thing as
closed loop water systems and

1020
01:06:54,720 --> 01:06:56,480
now there are.
And they're did this, they're

1021
01:06:56,480 --> 01:06:59,080
the standard.
That's how quickly you guys

1022
01:06:59,240 --> 01:07:02,240
pivot.
And you pivoted for good reason.

1023
01:07:02,800 --> 01:07:05,840
But now everybody that's still
using the water hog systems is

1024
01:07:05,840 --> 01:07:08,480
going to get pressured to
upgrade their facilities to the

1025
01:07:08,480 --> 01:07:11,200
closed loop systems.
And there's a cost associated

1026
01:07:11,200 --> 01:07:14,280
with that.
At some point, these technology

1027
01:07:14,280 --> 01:07:21,560
changes add up to becoming cost
prohibitive and they can't rent

1028
01:07:21,560 --> 01:07:24,560
the facility anymore or they
just decide we're going to try

1029
01:07:24,560 --> 01:07:26,480
to reuse this as some other
thing.

1030
01:07:28,240 --> 01:07:32,240
But it feeds into that argument
that, you know, maybe there is a

1031
01:07:32,240 --> 01:07:35,000
risk here on the on the long end
of this thing.

1032
01:07:35,000 --> 01:07:37,800
And maybe it won't last forever
because technology indeed does

1033
01:07:37,800 --> 01:07:42,760
change all the time.
Yeah, it's, it's a, it's an

1034
01:07:43,040 --> 01:07:46,640
interesting take on it.
But in terms of just the water

1035
01:07:46,640 --> 01:07:51,080
issue, I haven't gone any
further with the nuances around

1036
01:07:51,080 --> 01:07:54,040
the chemicals or the water
removal or whatever.

1037
01:07:54,080 --> 01:07:59,760
I, I, because again, my goal is
I want to help people educate

1038
01:08:00,520 --> 01:08:06,360
their elected officials on the
risks and I want to, I'm going

1039
01:08:06,360 --> 01:08:09,680
to have limited time with them.
So I want, I want to do it on

1040
01:08:09,680 --> 01:08:12,400
the big ticket items that I know
are still there.

1041
01:08:12,400 --> 01:08:16,120
You know that the unsolvable
problems that if you're going to

1042
01:08:16,120 --> 01:08:18,920
move forward, need to be
mitigated because they can't be

1043
01:08:18,920 --> 01:08:21,160
removed.
Yeah, yeah.

1044
01:08:21,160 --> 01:08:22,319
I thought it was super
interesting.

1045
01:08:22,319 --> 01:08:27,760
So in preparation for this
conversation, I listen to and I,

1046
01:08:27,800 --> 01:08:30,560
I can't believe he got the sign
off to do on this, but I can't

1047
01:08:30,560 --> 01:08:32,760
remember the name, name of the
podcast or anything, but it was

1048
01:08:32,840 --> 01:08:35,479
a, it was a developer.
So it was like a lead developer

1049
01:08:35,640 --> 01:08:38,880
of these sites.
And he was on a podcast and he

1050
01:08:38,880 --> 01:08:43,000
talked seemingly very
authentically for an hour and a

1051
01:08:43,000 --> 01:08:45,720
half about all of these key
issues.

1052
01:08:46,680 --> 01:08:50,880
And the water one really struck
me because he mentioned the same

1053
01:08:50,880 --> 01:08:53,319
thing you did with the industry,
solved it with closed loop

1054
01:08:53,319 --> 01:08:56,960
systems.
And then here's where it gets

1055
01:08:56,960 --> 01:09:01,920
weird.
He mentioned that the the energy

1056
01:09:01,920 --> 01:09:06,640
pushback and the water pushback.
He mentioned that even though

1057
01:09:06,640 --> 01:09:10,960
the closed loop systems were far
more efficient, he had LED

1058
01:09:10,960 --> 01:09:14,640
projects where they went with
the far more energy consuming

1059
01:09:14,640 --> 01:09:17,600
air cooled system, which I don't
know how it works.

1060
01:09:17,600 --> 01:09:19,279
Whatever 1 uses air, 1 uses
water.

1061
01:09:19,279 --> 01:09:22,279
I don't know all the logistics,
but they went with the more

1062
01:09:22,359 --> 01:09:25,319
expensive one virtually because
of the optics.

1063
01:09:25,319 --> 01:09:27,960
Like it was a long, way longer
explanation than that.

1064
01:09:27,960 --> 01:09:31,720
But what I got out of it is they
went with the lesser efficient 1

1065
01:09:32,240 --> 01:09:36,160
because of the optics of the
water use.

1066
01:09:36,160 --> 01:09:39,760
Sure.
Which once you start delving

1067
01:09:39,760 --> 01:09:46,120
into making decisions because of
optics as opposed to logic and

1068
01:09:46,120 --> 01:09:49,680
reasoning.
Was very concerning to me to

1069
01:09:49,680 --> 01:09:54,480
hear him be willing to say that
on a podcast and just be like,

1070
01:09:54,480 --> 01:09:57,760
that's the way it was.
That's it was wild.

1071
01:09:58,320 --> 01:09:59,640
Yeah.
That, that actually doesn't

1072
01:09:59,640 --> 01:10:04,440
surprise me as much if you think
about it in the terms of look at

1073
01:10:04,440 --> 01:10:05,800
all the pushback they're
getting.

1074
01:10:06,280 --> 01:10:10,040
Yeah.
And they can invest a year and a

1075
01:10:10,040 --> 01:10:12,960
half trying to get one of these
deals over the line.

1076
01:10:13,800 --> 01:10:18,200
And are they willing to go with
a slightly less efficient

1077
01:10:18,720 --> 01:10:22,240
cooling system to push it over
the line, or are they going to

1078
01:10:22,240 --> 01:10:25,000
go with the more efficient one
and risk losing a year and a

1079
01:10:25,000 --> 01:10:27,400
half worth of work and having to
start over in another community?

1080
01:10:28,280 --> 01:10:31,920
So there's always, again, it's
incentives, right?

1081
01:10:31,920 --> 01:10:34,440
It's the, it's the, the
trade-offs.

1082
01:10:34,640 --> 01:10:38,280
And sometimes, sometimes you
make a decision that on its

1083
01:10:38,280 --> 01:10:42,360
surface looks wrong or
troubling.

1084
01:10:43,040 --> 01:10:45,760
But if you dig a little deeper
and look at all the variables,

1085
01:10:46,080 --> 01:10:48,600
it makes sense.
And, and I'll use Mount Pleasant

1086
01:10:48,600 --> 01:10:52,800
as an example, there's not a lot
of pushback in Mount Pleasant on

1087
01:10:53,080 --> 01:10:56,280
even the most recent fifteen
data center announcement for

1088
01:10:56,280 --> 01:11:04,240
Microsoft because it's replacing
something Foxconn commitments

1089
01:11:04,800 --> 01:11:08,760
that's even worse, right?
What Foxconn's not delivering

1090
01:11:09,040 --> 01:11:10,920
and Microsoft's there to bail
them out.

1091
01:11:10,920 --> 01:11:14,200
They're, they probably welcome
the data centers because they're

1092
01:11:14,200 --> 01:11:15,920
bailing them out of a really
deep hole.

1093
01:11:16,760 --> 01:11:21,440
And so, yeah, there's, there's
always nuance there.

1094
01:11:21,440 --> 01:11:25,720
And I, I think that that person
was probably being super genuine

1095
01:11:25,720 --> 01:11:27,320
about their decision making
process.

1096
01:11:27,320 --> 01:11:30,440
And I completely understand why
they're doing it because of the

1097
01:11:30,440 --> 01:11:33,560
investment they're making in
particularly in time.

1098
01:11:34,560 --> 01:11:38,120
And by the way, on the time
function, these tech companies

1099
01:11:38,120 --> 01:11:41,120
are in a hurry to build.
You know, you look around and

1100
01:11:41,120 --> 01:11:44,840
you think why?
It's like 2 1/2 trillion dollars

1101
01:11:44,840 --> 01:11:48,000
worth of data center proposals
in aggregate.

1102
01:11:48,840 --> 01:11:51,840
Now granted, they're throwing a
lot of them against the wall to

1103
01:11:51,840 --> 01:11:53,760
see which ones stick, and they
know they're not going to get

1104
01:11:53,760 --> 01:11:59,480
all 2 1/2 trillion.
But getting inside their heads

1105
01:11:59,480 --> 01:12:03,840
on why they're proposing so many
artificial intelligence is a

1106
01:12:03,840 --> 01:12:08,160
very expensive operation.
And I don't mean expensive data,

1107
01:12:08,160 --> 01:12:10,080
I mean computing resource
intensive.

1108
01:12:11,680 --> 01:12:16,160
On the flip side, or contrary to
that, a Google search has been

1109
01:12:16,320 --> 01:12:19,600
made so efficient it's like a
fraction of a fraction of a

1110
01:12:19,600 --> 01:12:24,680
penny per search.
Artificial intelligence searches

1111
01:12:24,680 --> 01:12:31,880
or usages are not cheap.
Add to that the buzz around the

1112
01:12:31,880 --> 01:12:34,560
world that artificial
intelligence needs to be in

1113
01:12:34,560 --> 01:12:37,880
every product, everywhere, doing
everything, and you have

1114
01:12:37,880 --> 01:12:40,560
expensive times.
Everything equals I need a

1115
01:12:40,560 --> 01:12:42,360
really large number of data
centers.

1116
01:12:43,440 --> 01:12:49,920
So another risk that that
articulates to that I used to

1117
01:12:49,920 --> 01:12:54,640
articulate to people making
these decisions is, well, what

1118
01:12:54,640 --> 01:12:58,240
happens if somebody comes along
and makes that operation a lot

1119
01:12:58,360 --> 01:13:01,360
more efficient?
Which is almost inevitable,

1120
01:13:01,360 --> 01:13:03,080
right?
It is more than, it's more than

1121
01:13:03,080 --> 01:13:07,280
inevitable.
But you, if you're a, if you're

1122
01:13:07,280 --> 01:13:10,560
a tech company or even a regular
run-of-the-mill company that

1123
01:13:10,560 --> 01:13:13,000
wants to put artificial
intelligence and everything,

1124
01:13:13,320 --> 01:13:17,240
you, you can't bet on that
happening because it might

1125
01:13:17,240 --> 01:13:19,600
happen in six months, it might
happen in six years.

1126
01:13:20,280 --> 01:13:23,480
So you have to keep pushing
based on what you know today.

1127
01:13:24,000 --> 01:13:26,520
And that's why all these
proposals are out there and

1128
01:13:26,520 --> 01:13:31,360
they're trying to build so fast.
If they bet wrong, if they bet

1129
01:13:31,360 --> 01:13:34,000
that somebody will make it more
efficient or we won't need it in

1130
01:13:34,000 --> 01:13:37,320
every product and that proves
not to be true, they just lost

1131
01:13:37,320 --> 01:13:42,800
their business or or at least
took a big hit to their market

1132
01:13:42,920 --> 01:13:45,680
share.
So they're running scared.

1133
01:13:47,000 --> 01:13:50,960
They're literally trying to save
their business from this major

1134
01:13:50,960 --> 01:13:55,480
shift in technology with which
by all accounts is a very

1135
01:13:55,480 --> 01:13:57,640
exciting new technology that can
do a lot of things.

1136
01:13:57,640 --> 01:14:00,640
It could also do a lot of harm
if not handled correctly.

1137
01:14:01,120 --> 01:14:06,160
But yeah, they they have no
choice but to all hit the gas

1138
01:14:06,280 --> 01:14:11,040
and go as fast as they can.
But it as a software guy in my

1139
01:14:11,120 --> 01:14:16,040
former life, it is inevitable on
the short term.

1140
01:14:16,040 --> 01:14:20,800
In the reasonably short term, a
few years, not a lot of years

1141
01:14:20,800 --> 01:14:25,680
term that we figure out a way to
make artificial intelligence a

1142
01:14:25,680 --> 01:14:32,040
heck of a lot more efficient
unless some big giant pile of

1143
01:14:32,040 --> 01:14:37,360
money shows up in terms of
revenue for AI, it has to

1144
01:14:37,360 --> 01:14:40,640
because it's an it's an expense
to everybody's product and

1145
01:14:41,320 --> 01:14:44,320
either you have revenue to cover
it or you can't do it.

1146
01:14:45,200 --> 01:14:48,960
Especially with the way that the
AI industry is, you know,

1147
01:14:48,960 --> 01:14:51,920
promoting and pushing use, I
mean, Super Bowl commercials and

1148
01:14:51,920 --> 01:14:56,280
stuff like promoting the use.
And maybe this is a great kind

1149
01:14:56,280 --> 01:15:02,840
of bridge to maybe shifting
gears a little bit, not really

1150
01:15:02,840 --> 01:15:09,840
playing devil's advocate, but in
the grand scheme, why are, in

1151
01:15:09,840 --> 01:15:16,840
your opinion, why are these
necessary for growth moving

1152
01:15:16,840 --> 01:15:20,080
forward?
Like what are the benefits that

1153
01:15:20,480 --> 01:15:23,800
every that people are going to
see because of the development

1154
01:15:24,080 --> 01:15:28,440
of artificial intelligence?
Well, I think you can.

1155
01:15:28,880 --> 01:15:33,280
You can start to see it today
just with, I guess what I'd call

1156
01:15:33,280 --> 01:15:38,520
it enhanced search.
You know, sit next time you sit

1157
01:15:38,520 --> 01:15:42,880
down at a Google search prompt
or whatever, pick your, pick

1158
01:15:42,880 --> 01:15:45,960
your search engine.
You know, in the old days, a

1159
01:15:46,200 --> 01:15:49,960
couple years ago, the really old
days, you would, you would have

1160
01:15:49,960 --> 01:15:54,640
to intuit what the right search
terms were and find articles and

1161
01:15:54,640 --> 01:15:57,960
start reading the articles.
And you'd have to do a bunch of

1162
01:15:57,960 --> 01:16:02,200
the legwork yourself.
And you can see it now.

1163
01:16:02,200 --> 01:16:06,320
I, you can start just forming
regular English questions and

1164
01:16:06,720 --> 01:16:08,680
it'll go do all that legwork for
you.

1165
01:16:09,240 --> 01:16:11,520
Well, that's a huge time
savings.

1166
01:16:11,800 --> 01:16:14,160
Of course, it could do it wrong
and send you down a terrible

1167
01:16:14,160 --> 01:16:16,400
rabbit hole, but that's another
problem.

1168
01:16:17,160 --> 01:16:24,200
So yeah, if if used
benevolently, it can be a

1169
01:16:24,200 --> 01:16:29,800
massive aid in doing a lot of
that tedious legwork.

1170
01:16:30,720 --> 01:16:37,080
And I can think of innumerable
use cases where that kind of

1171
01:16:37,080 --> 01:16:43,000
analysis would make life better.
It would, you know, calling,

1172
01:16:43,000 --> 01:16:47,480
calling into a call Center for
customer service, some amount of

1173
01:16:47,480 --> 01:16:50,600
artificial intelligence applied
to that that gets you to the

1174
01:16:50,600 --> 01:16:52,640
right person would be really
humble, right?

1175
01:16:52,640 --> 01:16:56,560
Instead of telling your Story 3
times to before you finally get

1176
01:16:56,560 --> 01:17:00,240
to the human that can answer
your question or, or even having

1177
01:17:00,240 --> 01:17:03,560
your question asking your
question in English and having

1178
01:17:03,560 --> 01:17:05,240
it answered without needing the
human.

1179
01:17:05,680 --> 01:17:08,880
You know, there are all kinds of
things that come to mind as

1180
01:17:09,080 --> 01:17:14,760
being able to be smarter than we
are today with our more

1181
01:17:14,760 --> 01:17:20,240
traditional software systems.
Everybody is right to think the

1182
01:17:20,240 --> 01:17:23,600
possibilities are endless.
As you know, we said that with

1183
01:17:23,600 --> 01:17:25,720
the Internet, the possibilities
are endless.

1184
01:17:26,440 --> 01:17:30,480
And, and back to the the other,
the risk topic.

1185
01:17:30,920 --> 01:17:33,680
Yeah, the possibilities were
endless with the Internet.

1186
01:17:33,680 --> 01:17:35,880
And the Internet was going to be
everywhere.

1187
01:17:36,200 --> 01:17:39,040
And we overbuilt like crazy
getting there and we had a whole

1188
01:17:39,040 --> 01:17:41,600
bunch of companies fail and
crash.

1189
01:17:41,760 --> 01:17:44,720
And there's a parallel here to
that.

1190
01:17:46,760 --> 01:17:51,320
It, it's more it's, it's at
least rhyming, if not repeating.

1191
01:17:53,040 --> 01:17:55,680
There's a huge buzz about what
AI can do.

1192
01:17:55,680 --> 01:18:00,200
And it's all legitimate.
And it's likely here to stay as

1193
01:18:00,200 --> 01:18:02,400
the Internet was here to stay
all along.

1194
01:18:02,960 --> 01:18:06,200
But we are going to struggle
mightily figuring out how it's

1195
01:18:06,200 --> 01:18:11,600
going to fit and, and we are
over building both because it's

1196
01:18:11,600 --> 01:18:15,280
super expensive right now, but
and the price has to come down,

1197
01:18:15,960 --> 01:18:20,040
but also because we're just
going to, as the technology

1198
01:18:20,040 --> 01:18:22,240
industry always does, we're
going to toss stuff against the

1199
01:18:22,240 --> 01:18:25,520
wall and see what works.
And if people end up being

1200
01:18:25,520 --> 01:18:28,360
willing to pay for it, great.
And if they don't, then it

1201
01:18:28,360 --> 01:18:30,200
becomes an expense you have to
manage.

1202
01:18:30,960 --> 01:18:34,000
But I agree with people, there
are endless use cases.

1203
01:18:34,000 --> 01:18:37,360
I also agree with people there
are endless nefarious use cases.

1204
01:18:38,520 --> 01:18:44,120
And, and the bottom line, the
whole industry right now is

1205
01:18:44,120 --> 01:18:45,920
struggling with or not
struggling.

1206
01:18:45,920 --> 01:18:50,120
They're, they're groping for
what is the right use and they

1207
01:18:50,120 --> 01:18:52,520
want to, they, everybody wants
to be the one that figures it

1208
01:18:52,520 --> 01:18:55,720
out.
And so the money is chasing that

1209
01:18:55,720 --> 01:18:59,720
because whoever figures it out
is the next trillion dollar

1210
01:18:59,720 --> 01:19:01,520
company.
Absolutely.

1211
01:19:01,520 --> 01:19:04,960
And it's worth the bet.
Yeah, it's going to be

1212
01:19:04,960 --> 01:19:09,120
fascinating to see develop, you
know, my role in in my

1213
01:19:09,120 --> 01:19:11,280
day-to-day role.
And I mean even stuff with the

1214
01:19:11,280 --> 01:19:14,680
podcast to, you know, almost on
a daily basis.

1215
01:19:14,680 --> 01:19:19,080
I use AI in in different
capacities and it's it's

1216
01:19:19,080 --> 01:19:29,520
interesting to see the the
difference in perception of it

1217
01:19:29,880 --> 01:19:33,680
between someone who uses it
regularly or has never.

1218
01:19:33,680 --> 01:19:37,200
Like there's plenty of people
that have never asked to ChatGPT

1219
01:19:37,200 --> 01:19:42,880
a question or something.
And there's a lot, you know, we

1220
01:19:42,880 --> 01:19:46,840
won't get into too much like
conjecture, prognosticating or

1221
01:19:46,840 --> 01:19:49,080
anything.
But there there's it's going to

1222
01:19:49,080 --> 01:19:52,000
be fascinating to see how it
comes to play in the use of

1223
01:19:52,000 --> 01:19:55,480
day-to-day lives on a in a
widespread way, and what ends up

1224
01:19:55,480 --> 01:19:58,480
becoming the quote UN quote
Google.

1225
01:19:58,480 --> 01:20:02,240
Yeah, there, there are, there
are so many interesting threads

1226
01:20:02,240 --> 01:20:06,000
that come off of the technology.
There's there's a whole legal

1227
01:20:06,000 --> 01:20:09,320
thread.
What you know who's who's going

1228
01:20:09,320 --> 01:20:13,000
to be accountable for, legally
accountable for something that

1229
01:20:13,000 --> 01:20:16,120
goes wrong because of an AI
algorithm that got something

1230
01:20:16,120 --> 01:20:19,400
upside down.
Yeah, yeah, they're, they're

1231
01:20:19,400 --> 01:20:22,680
just innumerable different
regulation.

1232
01:20:22,680 --> 01:20:25,120
How are we going to regulate it?
It has to be some sort of

1233
01:20:25,120 --> 01:20:27,040
regulation around privacy of
data and.

1234
01:20:27,600 --> 01:20:32,240
And creation of fake images that
look pretty damn real.

1235
01:20:32,760 --> 01:20:37,000
They're endless topics on and
subtopics within all of those,

1236
01:20:38,640 --> 01:20:45,240
and it's going to be rough and
tumble and probably never ending

1237
01:20:45,720 --> 01:20:48,040
getting to decent answers on
them.

1238
01:20:49,160 --> 01:20:51,560
But we can't stuff the genie
back in the bottle.

1239
01:20:51,960 --> 01:20:55,200
That's impossible.
And there are legitimately

1240
01:20:55,200 --> 01:21:00,040
fantastic uses of it that will
save us a lot of time and effort

1241
01:21:00,040 --> 01:21:02,760
and money and so on.
And it's going to be a big

1242
01:21:02,760 --> 01:21:10,560
adjustment for our economy and
our lives to adjust to something

1243
01:21:10,560 --> 01:21:13,640
that's doing a lot for us that
we otherwise didn't.

1244
01:21:13,960 --> 01:21:17,920
And, and one day you'll wake up
and realize, just like today,

1245
01:21:17,920 --> 01:21:20,560
you wake up and realize, I can't
get anywhere without Google

1246
01:21:20,560 --> 01:21:24,440
Maps, right.
And we used to like look at the

1247
01:21:24,440 --> 01:21:28,560
map before we left in the car to
get where we were going.

1248
01:21:29,160 --> 01:21:33,400
That same path we're on.
We're on that with AI and we're

1249
01:21:33,400 --> 01:21:36,760
going to wake up one day and
say, jeez, it's everywhere.

1250
01:21:36,760 --> 01:21:38,560
And how, how would I do anything
without it?

1251
01:21:39,440 --> 01:21:43,480
And it's, you know, it can be
frightening to people and and it

1252
01:21:43,480 --> 01:21:45,600
also can be legitimately
concerning.

1253
01:21:45,600 --> 01:21:48,360
I share those concerns because
they're awful lot of people out

1254
01:21:48,360 --> 01:21:52,920
there that will cast aside their
ethics to do something to turn a

1255
01:21:52,920 --> 01:21:58,200
buck and and we have to be
diligent in preventing them from

1256
01:21:58,200 --> 01:22:02,200
doing those things.
I use that same exact example in

1257
01:22:02,200 --> 01:22:05,480
the classroom all the time.
Yeah, I'm actually, I have to.

1258
01:22:05,480 --> 01:22:08,680
I'm moderating an AI panel in a
couple weeks.

1259
01:22:09,640 --> 01:22:13,080
And like, I, I use that example
all the time.

1260
01:22:13,080 --> 01:22:15,040
And I use it in relation to my
dad.

1261
01:22:15,040 --> 01:22:16,840
My dad still doesn't use Google
Maps.

1262
01:22:16,840 --> 01:22:19,040
He's got a smartphone now, but
he doesn't use Google Maps for

1263
01:22:19,040 --> 01:22:22,200
him.
I talk with him and he can he

1264
01:22:22,200 --> 01:22:26,760
remembers Rd. names in little,
you know, ABC Wisconsin that he

1265
01:22:26,760 --> 01:22:29,680
hasn't been since 1999.
And he's like, yeah, you just

1266
01:22:29,680 --> 01:22:32,400
got to turn on this road.
Yeah, I'm lucky.

1267
01:22:32,400 --> 01:22:34,560
I know this road my my house is
on.

1268
01:22:36,320 --> 01:22:38,600
Like I lived in my neighborhood
for three years before I knew

1269
01:22:38,600 --> 01:22:40,160
the road that I turned on to my
Rd. from.

1270
01:22:41,560 --> 01:22:45,000
And there's a lot of fun
conversation that can be had in

1271
01:22:45,000 --> 01:22:46,520
that area.
It's, it's fun to chat about

1272
01:22:46,520 --> 01:22:49,840
what you know, how it's going to
change humanity.

1273
01:22:49,920 --> 01:22:53,560
And there's a lot of scary stuff
in that too, about what comes of

1274
01:22:53,560 --> 01:22:55,200
it.
And that's all very real.

1275
01:22:55,320 --> 01:22:59,040
And we could probably, we could
talk ad nauseam about, about

1276
01:22:59,040 --> 01:23:03,960
those things.
But I I love the my awareness

1277
01:23:03,960 --> 01:23:08,600
right now is the community
impact of it.

1278
01:23:08,920 --> 01:23:11,000
I do have one kind of fun
question before we move on from

1279
01:23:11,000 --> 01:23:16,880
that.
I I've thought a plenty about I

1280
01:23:16,880 --> 01:23:20,480
saw that Elon he you know, he
makes these wild forecasts all

1281
01:23:20,480 --> 01:23:23,480
the time.
He he forecasted like he's

1282
01:23:23,480 --> 01:23:26,840
dangling this carrot it it and I
don't know what his incentive is

1283
01:23:26,840 --> 01:23:28,640
about it.
It has to be something that

1284
01:23:28,640 --> 01:23:32,720
Tesla is moving in that
direction as opposed to vehicles

1285
01:23:32,720 --> 01:23:35,320
like where they have been.
But he's dangled this thing

1286
01:23:35,320 --> 01:23:38,760
that, you know, potentially X
amount of years, no one will

1287
01:23:38,760 --> 01:23:42,080
have to work anymore.
And we'll have this grand

1288
01:23:42,080 --> 01:23:46,360
problem of finding our value in
life when we don't have it tied

1289
01:23:46,360 --> 01:23:47,400
to our job.
Yeah.

1290
01:23:48,120 --> 01:23:51,280
As someone who, you know, spent
a long career in the sector and,

1291
01:23:51,280 --> 01:23:57,960
and kind of like has a gauge on
it, is that is that grandiose,

1292
01:23:57,960 --> 01:24:00,840
you know, hyperbole or is it
realistic?

1293
01:24:01,200 --> 01:24:07,640
I it's, it's hyperbole.
I I don't think that, I don't

1294
01:24:07,640 --> 01:24:10,360
think that's possible.
I people need to work.

1295
01:24:11,080 --> 01:24:13,560
People.
People get value from working.

1296
01:24:13,640 --> 01:24:18,640
And every technology advancement
in the past has displaced jobs,

1297
01:24:18,640 --> 01:24:21,040
but they've been replaced with
something else.

1298
01:24:21,040 --> 01:24:25,520
If we've humans will adapt and
they will adapt to do something

1299
01:24:25,520 --> 01:24:28,120
that solves tomorrow's problem
instead of today's problem.

1300
01:24:30,080 --> 01:24:37,320
And so, yeah, I think it's
hyperbolic and, and the model of

1301
01:24:37,640 --> 01:24:40,760
all of us silly humans sitting
around and reaping the benefits

1302
01:24:40,760 --> 01:24:44,240
of robots running around doing
everything for us.

1303
01:24:45,040 --> 01:24:51,240
I I don't think that ends well.
Yeah, I don't that that sounds

1304
01:24:51,640 --> 01:24:54,160
like a model that would never
ever work.

1305
01:24:54,160 --> 01:24:56,160
Sounds really dystopian.
Yeah, exactly.

1306
01:24:56,160 --> 01:25:02,400
Yeah, it it's, you know, as, as
someone who you know, is

1307
01:25:02,400 --> 01:25:04,440
passionate about a lot of
different things and is willing

1308
01:25:04,440 --> 01:25:06,760
to run in really strange
directions at times just to

1309
01:25:06,760 --> 01:25:10,560
chase that passion.
It's fun to think about.

1310
01:25:10,720 --> 01:25:16,560
But I agree the, there will
always be.

1311
01:25:17,280 --> 01:25:20,160
I, I don't think you know, that
the person doesn't go to work

1312
01:25:20,160 --> 01:25:25,600
the, the nine to five job, you
know, and make their $70,000

1313
01:25:25,600 --> 01:25:28,600
and, and work on the line or
whatever they're doing.

1314
01:25:29,080 --> 01:25:34,880
They don't do it of firm faith
and belief in the end product

1315
01:25:34,880 --> 01:25:37,720
all the time.
It it it's that or or like the

1316
01:25:37,720 --> 01:25:40,800
other side of supporting your
family and stuff, which we all

1317
01:25:40,800 --> 01:25:44,640
have to do.
There's, there's a human value

1318
01:25:44,640 --> 01:25:54,160
that is pretty unanimous that
searches for, I'm at a loss for

1319
01:25:54,160 --> 01:25:57,960
words kind of something to cling
to that it is part of your

1320
01:25:58,720 --> 01:26:03,440
identity in a way.
And I don't, I guess what I'm

1321
01:26:03,440 --> 01:26:08,840
getting at is I don't see that
becoming disconnected from

1322
01:26:09,200 --> 01:26:12,440
acquiring resources as it has
been in the past.

1323
01:26:12,440 --> 01:26:15,200
Like I, I don't see how those
two things could divert so far

1324
01:26:15,200 --> 01:26:17,800
away that tomorrow I don't have
to go to work.

1325
01:26:18,120 --> 01:26:20,680
I just have to decide what I'm
passionate about, then do it.

1326
01:26:20,680 --> 01:26:25,120
It's always going to come with
some type of fiscal or resource

1327
01:26:25,720 --> 01:26:28,160
trade, I think.
Yeah, absolutely.

1328
01:26:28,840 --> 01:26:32,080
You, you can't.
I think it's too ingrained in

1329
01:26:32,080 --> 01:26:35,080
human beings to want to be able
to produce something of value

1330
01:26:35,080 --> 01:26:37,800
for someone else, whether it's a
good or a service or whatever.

1331
01:26:38,720 --> 01:26:42,600
You, you can't.
It would not end well if our

1332
01:26:42,600 --> 01:26:47,560
jobs were to sit on the couch
and watch TV and not ever do

1333
01:26:47,560 --> 01:26:49,040
anything.
We would go nuts.

1334
01:26:49,040 --> 01:26:53,320
And we, it, there's, there's
something human there that you

1335
01:26:53,320 --> 01:26:58,200
can't escape.
And, and AI is not going to

1336
01:26:58,440 --> 01:27:00,600
cause us to go down that path.
There's no way.

1337
01:27:00,600 --> 01:27:02,880
We'll, we'll figure out
something else to do that people

1338
01:27:02,880 --> 01:27:08,040
want to exchange dollars or
services or whatever, whether

1339
01:27:08,040 --> 01:27:11,520
it's a barter system or a
monetary system, We've always

1340
01:27:11,520 --> 01:27:16,600
traded things in a mutual
exchange that is beneficial to

1341
01:27:16,600 --> 01:27:18,760
both parties.
And we're going to continue to

1342
01:27:18,760 --> 01:27:21,120
do that.
Hopefully for hopefully it goes

1343
01:27:21,120 --> 01:27:23,720
up for the price of the person
actually playing the guitar.

1344
01:27:23,720 --> 01:27:30,400
It is it is possible that it
displaces a lot more jobs than

1345
01:27:31,520 --> 01:27:33,880
any other technology change has
in the past.

1346
01:27:33,880 --> 01:27:35,840
Yeah.
That's a, that's a possibility.

1347
01:27:36,080 --> 01:27:40,520
It could be more disruptive, but
I'm even a little skeptical of

1348
01:27:40,520 --> 01:27:43,840
that.
I, I think the timeline on that

1349
01:27:44,360 --> 01:27:50,440
is protracted and there's not
some Cliff awaiting us where

1350
01:27:51,440 --> 01:27:54,000
quarter of the population now no
longer has work to do.

1351
01:27:54,000 --> 01:27:57,680
The technology's not that ready
for prime time, in case you

1352
01:27:57,680 --> 01:27:59,440
haven't noticed in your own use
of it.

1353
01:28:00,080 --> 01:28:05,680
I it gets some stuff horribly
wrong and it'll tighten up over

1354
01:28:05,680 --> 01:28:09,440
time, but it's any kind of
change like that is going to be

1355
01:28:09,440 --> 01:28:13,240
more gradual than the
prognosticators predict.

1356
01:28:13,480 --> 01:28:18,000
Yeah, it is fascinating to see
how much, how quickly it has

1357
01:28:18,000 --> 01:28:21,880
gotten better, you know, even
within the last two years,

1358
01:28:21,920 --> 01:28:24,640
things two years ago that I
would have never thought using

1359
01:28:24,640 --> 01:28:29,240
it for today I can use it very
effectively and efficiently.

1360
01:28:30,320 --> 01:28:36,400
So it is interesting and that
there's certainly there's

1361
01:28:36,400 --> 01:28:40,520
certainly a component to it of I
get the motivation because of

1362
01:28:40,520 --> 01:28:44,040
it's, it's almost like another
space race in a way, like the

1363
01:28:44,200 --> 01:28:49,480
the countries who implement this
correctly are going to be much

1364
01:28:49,480 --> 01:28:54,120
better positioned than than
countries that don't to move

1365
01:28:54,120 --> 01:28:57,800
forward in whatever the the the
post AI world develops into.

1366
01:28:58,560 --> 01:29:02,480
So that was that's one of my
main intentions to really dive

1367
01:29:02,480 --> 01:29:07,400
in and try to understand this
holistically, because I get that

1368
01:29:07,400 --> 01:29:12,520
lay and I and I agree with it to
some instance where that like

1369
01:29:12,520 --> 01:29:15,200
who, who wins, quote UN quote
wins.

1370
01:29:15,200 --> 01:29:17,960
That's a bad way to put it.
But who develops this more

1371
01:29:17,960 --> 01:29:22,960
effectively and and quicker and
in a way that benefits for the

1372
01:29:22,960 --> 01:29:26,440
most part, the output.
I'm saying not the communities

1373
01:29:26,440 --> 01:29:30,320
because I, I think that's pretty
clear as of right now, but who,

1374
01:29:30,400 --> 01:29:34,800
who benefits as a whole from it
are going to be very well

1375
01:29:34,800 --> 01:29:38,320
positioned moving forward.
And I think that's where some of

1376
01:29:38,320 --> 01:29:40,680
the trade off has to come in
with this conversation because

1377
01:29:40,680 --> 01:29:44,080
it's like the kind of the not in
my backyard argument, right?

1378
01:29:44,080 --> 01:29:46,840
It's like, well, I don't want it
by me, but we really need it.

1379
01:29:47,760 --> 01:29:51,680
Here's here's the place.
But there will always be these

1380
01:29:52,240 --> 01:30:00,640
forces manipulating where
something like this ends up and

1381
01:30:00,640 --> 01:30:02,880
where the infrastructure goes
and where they go.

1382
01:30:02,920 --> 01:30:06,200
Sure.
And I just see from a bird's eye

1383
01:30:06,200 --> 01:30:11,240
view, from the layman's view, I,
your, our conversation today

1384
01:30:11,240 --> 01:30:15,400
completely justified in my mind
where I was at that the levels

1385
01:30:15,600 --> 01:30:20,040
of power and resources between
the two parties at the

1386
01:30:20,040 --> 01:30:23,280
bargaining table are the
disparity between them is so

1387
01:30:23,280 --> 01:30:27,000
huge that it's, it's past the
point of being unfair.

1388
01:30:27,000 --> 01:30:32,320
It it's just not even realistic.
Correct on the topic of we need

1389
01:30:32,320 --> 01:30:38,120
them somewhere, but where It's a
common topic that I address when

1390
01:30:38,120 --> 01:30:43,920
I talk to communities as a
technology professional, I think

1391
01:30:43,920 --> 01:30:49,240
we need data centers.
I, I don't dispute that I'm not

1392
01:30:49,240 --> 01:30:54,680
a no data center anywhere guy.
So people have asked me, OK,

1393
01:30:54,800 --> 01:30:58,560
smart ass, if, if we have to
have them somewhere where.

1394
01:30:59,360 --> 01:31:04,040
And my answer is one they need
because of the risk of

1395
01:31:04,520 --> 01:31:06,760
technology change and
obsolescence and lower

1396
01:31:06,760 --> 01:31:09,520
valuations of buildings and
financial concentration, blah

1397
01:31:09,520 --> 01:31:11,880
blah blah.
They have to be in a place that

1398
01:31:11,880 --> 01:31:14,840
has a large enough tax base to
absorb that kind of problem.

1399
01:31:15,640 --> 01:31:20,000
If you put them in a place where
they're half your tax base,

1400
01:31:20,680 --> 01:31:24,120
that's not going to end well.
But if it's 5% of your tax base,

1401
01:31:24,120 --> 01:31:26,400
OK, now it's getting a little
more tolerable.

1402
01:31:26,400 --> 01:31:28,280
If it's 1%, that'd be even
better.

1403
01:31:30,480 --> 01:31:36,920
The other salient feature of
places where they can be as some

1404
01:31:36,920 --> 01:31:42,120
place that decides they want to
do a lot of them, Northern

1405
01:31:42,120 --> 01:31:43,520
Virginia wants to do a lot of
them.

1406
01:31:43,520 --> 01:31:46,720
They like data centers, call
they're crazy, but whatever.

1407
01:31:46,960 --> 01:31:50,280
You know that if you want to
build a lot of them, go to town.

1408
01:31:50,840 --> 01:31:54,600
You will have constant
construction and you'll have

1409
01:31:54,600 --> 01:31:58,080
constant economic development
because of all the construction.

1410
01:31:58,240 --> 01:32:01,640
The construction becomes the
permanent thing about your data

1411
01:32:01,640 --> 01:32:03,920
centers.
You've got some little towns out

1412
01:32:03,920 --> 01:32:08,560
West in Oregon and Washington
that that are near good power

1413
01:32:08,560 --> 01:32:13,840
sources that have decided we're
going to do a lot of them.

1414
01:32:14,160 --> 01:32:18,840
There's some places in Iowa
10/15/20 data centers over the

1415
01:32:18,840 --> 01:32:22,080
course of 15 to 20 years, just
non-stop construction.

1416
01:32:22,720 --> 01:32:25,280
So if that's what a community
wants to do because it's

1417
01:32:25,280 --> 01:32:28,480
desperate, it's you know, maybe
maybe it's on just on the other

1418
01:32:28,480 --> 01:32:33,880
side of an event where the big
employer in town left and they

1419
01:32:34,040 --> 01:32:35,600
they're desperate for the
revenue.

1420
01:32:35,640 --> 01:32:39,480
Fine, make that decision openly
and consciously and maybe your

1421
01:32:39,480 --> 01:32:43,160
small town can be that place
that becomes the next data

1422
01:32:43,160 --> 01:32:50,480
center desert or whatever.
But that if it's not going to be

1423
01:32:50,480 --> 01:32:52,640
some place where they want to do
a lot of them, it's and you're

1424
01:32:52,840 --> 01:32:56,520
trying to pick this place, it
has to have the tax base to

1425
01:32:56,520 --> 01:32:59,000
absorb it.
And then the data, the data

1426
01:32:59,000 --> 01:33:02,160
center industry, the technology
industry has a problem because

1427
01:33:02,160 --> 01:33:07,600
they're so big.
To have a community that's large

1428
01:33:07,600 --> 01:33:12,960
enough to absorb the tax base
loss of a billion, $2 billion

1429
01:33:12,960 --> 01:33:17,040
worth of buildings, that takes a
reasonably large community and

1430
01:33:17,040 --> 01:33:19,040
now you don't have the space
available.

1431
01:33:20,000 --> 01:33:24,760
So what I think has happened to
date is the industry is pushing

1432
01:33:25,000 --> 01:33:28,280
forward with, well, this is the
most appropriate thing for us to

1433
01:33:28,280 --> 01:33:30,320
build based on the business
problem that we have.

1434
01:33:30,840 --> 01:33:34,400
So we want to build this thing.
This thing doesn't fit in the

1435
01:33:34,400 --> 01:33:38,560
place that makes sense for
municipality to host.

1436
01:33:39,440 --> 01:33:41,520
And so now we're between a rock
and a hard place.

1437
01:33:41,520 --> 01:33:44,360
What do we do?
I think the industry needs to

1438
01:33:44,360 --> 01:33:48,200
solve that problem just like it
solved the water problem.

1439
01:33:48,800 --> 01:33:51,400
Stop building 3,000,000 square
feet of building.

1440
01:33:52,440 --> 01:33:54,080
Build.
Build smaller buildings.

1441
01:33:54,080 --> 01:33:58,000
Yes, it costs more.
Yes, there's more cost per

1442
01:33:58,000 --> 01:34:00,040
building.
You know, there's fixed cost per

1443
01:34:00,040 --> 01:34:02,680
building.
There's all that annoying zoning

1444
01:34:02,680 --> 01:34:05,920
and permitting nonsense that is
times 3 now instead of times

1445
01:34:05,920 --> 01:34:09,720
one.
I get all that, but just because

1446
01:34:09,720 --> 01:34:12,520
something is more convenient for
you doesn't mean you get to do

1447
01:34:12,520 --> 01:34:13,640
it.
Right.

1448
01:34:14,000 --> 01:34:16,880
You, you have to meet these
communities halfway.

1449
01:34:17,560 --> 01:34:23,240
If if you go into a a small town
and say I want to build a

1450
01:34:23,240 --> 01:34:28,800
100,000 square foot data center,
that might be perfectly fine.

1451
01:34:29,800 --> 01:34:33,040
It might be perfectly absorbable
depending on the size of the

1452
01:34:33,040 --> 01:34:38,160
community and and easy to get
approved but if you want

1453
01:34:38,160 --> 01:34:45,000
3,000,000 square feet then it
it's a non starter so it's a

1454
01:34:45,000 --> 01:34:47,880
hard problem to solve.
I get, and it's way easier said

1455
01:34:47,880 --> 01:34:53,520
than done, but I I'd think the
industry really needs to address

1456
01:34:54,040 --> 01:34:57,920
that.
The most important features that

1457
01:34:57,920 --> 01:35:01,040
they are searching for all
happen to be in these little

1458
01:35:01,040 --> 01:35:05,240
tiny towns that are overwhelmed
by the footprint of the

1459
01:35:05,240 --> 01:35:09,200
facility.
And I really want to put

1460
01:35:09,200 --> 01:35:11,680
pressure on them to solve for
that problem.

1461
01:35:12,440 --> 01:35:15,080
I don't know how they solve it.
Like they could easily just make

1462
01:35:15,080 --> 01:35:17,880
things smaller, but I know what
problems that visits upon them.

1463
01:35:18,600 --> 01:35:21,120
So I know it's not an easy
problem to solve, but I think

1464
01:35:21,120 --> 01:35:24,200
that's the real problem here
that they need to address.

1465
01:35:24,960 --> 01:35:28,080
That's a really interesting
thing that I've never thought

1466
01:35:28,080 --> 01:35:30,720
about up to this point because I
don't I guess I don't know

1467
01:35:30,720 --> 01:35:33,680
enough about the XS and OS to
know if it's possible.

1468
01:35:33,680 --> 01:35:40,760
But is it purely like, can it be
broken down to this amount of

1469
01:35:40,760 --> 01:35:45,200
square feet is needed and it
doesn't matter if it's one

1470
01:35:45,200 --> 01:35:48,360
building or 100 buildings, it
does the same thing.

1471
01:35:48,360 --> 01:35:50,480
Like I don't even know what kind
of equipment goes into it.

1472
01:35:50,480 --> 01:35:53,080
Or I, I don't, I have no idea
the XS and OS.

1473
01:35:53,080 --> 01:35:57,560
I mean, I'm a marketing guy.
I, I don't, I don't know what

1474
01:35:58,520 --> 01:36:01,760
is, is that like, because that
seems too easy.

1475
01:36:02,640 --> 01:36:07,560
Is it possible?
It's not easy because it it

1476
01:36:07,560 --> 01:36:12,080
require, it would require a lot
more build cost and build time

1477
01:36:13,160 --> 01:36:17,320
to build say five times as many
because they're all 20% of the

1478
01:36:17,320 --> 01:36:23,040
size that that's a that is a big
change that is not easily

1479
01:36:23,040 --> 01:36:26,760
accommodated and and it drives
up the IT drives up the cost.

1480
01:36:27,200 --> 01:36:29,440
See, I'm OK with that.
Oh, I know, I know you are.

1481
01:36:29,440 --> 01:36:31,480
But it, you know, everything has
a trade off, right?

1482
01:36:31,480 --> 01:36:37,720
And I don't, I don't want to
pretend that I don't want to.

1483
01:36:38,000 --> 01:36:41,160
I don't want to pretend I don't
care about, you know, trying to

1484
01:36:41,160 --> 01:36:43,480
help them solve a problem to
make a match.

1485
01:36:43,480 --> 01:36:47,520
You know, if if there is a match
here and you can build a couple

1486
01:36:47,520 --> 01:36:50,920
smaller ones here because they
fit into the community, maybe

1487
01:36:50,920 --> 01:36:53,920
that's a win for everybody.
I know what the side effect of

1488
01:36:53,920 --> 01:36:55,640
that is to your business.
And maybe we can have a

1489
01:36:55,640 --> 01:36:59,320
negotiation to talk about how to
make everybody happy.

1490
01:36:59,440 --> 01:37:01,480
I guess what negotiations
supposed to be about.

1491
01:37:02,040 --> 01:37:06,760
But these, they're building them
so big because artificial

1492
01:37:06,760 --> 01:37:08,960
intelligence is such an
expensive operation and they

1493
01:37:08,960 --> 01:37:14,040
need so many of them that
economically that's just simply

1494
01:37:14,040 --> 01:37:16,160
the most efficient thing to do
is make them massive.

1495
01:37:17,520 --> 01:37:19,760
We thought they were massive
before when cloud computing

1496
01:37:19,760 --> 01:37:24,080
became the thing and they were
building 100,200 thousand square

1497
01:37:24,080 --> 01:37:25,960
foot buildings.
Well, now there are 1,000,000

1498
01:37:26,160 --> 01:37:30,320
and and there are multiple
buildings per campus because the

1499
01:37:31,040 --> 01:37:32,880
footprint of the computing is so
big.

1500
01:37:34,400 --> 01:37:40,760
There's nothing technically
stopping them from having the

1501
01:37:40,760 --> 01:37:43,960
building cut in half where where
you have space between two

1502
01:37:43,960 --> 01:37:45,960
buildings.
Like they can make them smaller

1503
01:37:46,400 --> 01:37:49,640
and they're and we tie them
together with networks that that

1504
01:37:49,640 --> 01:37:52,640
happens all the time today.
You know, you do something on

1505
01:37:52,640 --> 01:37:55,280
your phone and you're probably
hitting multiple data centers.

1506
01:37:57,040 --> 01:37:59,400
So yeah, you can you could build
more of them.

1507
01:37:59,560 --> 01:38:01,960
It's just inconvenient and more
expensive.

1508
01:38:03,120 --> 01:38:09,000
But there's a real problem there
with the size and the top 2

1509
01:38:09,000 --> 01:38:12,680
criteria always seeming to land
in small towns.

1510
01:38:13,160 --> 01:38:17,320
Yeah.
And I just, I haven't yet seen

1511
01:38:17,320 --> 01:38:21,200
anybody acknowledge that and say
maybe there's a solution there.

1512
01:38:21,280 --> 01:38:23,920
I don't know.
Yeah, I could.

1513
01:38:24,400 --> 01:38:27,880
You know, the more I learn, I, I
kind of, I'm, I'm really glad to

1514
01:38:27,880 --> 01:38:33,280
hear you talk about the, the
making sense of being within the

1515
01:38:33,280 --> 01:38:35,680
landscape of large tax bases,
because that's kind of where my

1516
01:38:35,680 --> 01:38:38,120
brain was at too.
Like it, it has to be in these

1517
01:38:38,120 --> 01:38:40,160
areas.
And I, I completely like, I've

1518
01:38:40,160 --> 01:38:43,720
thought about the, the
constraints of the land there.

1519
01:38:43,720 --> 01:38:47,760
That's why they don't do it
there.

1520
01:38:48,160 --> 01:38:50,480
You know, I've thought of some
pie in the sky ideas in that

1521
01:38:50,480 --> 01:38:54,200
realm, but I guess we'll stick
in the, we'll stick along the

1522
01:38:54,200 --> 01:38:57,000
lens of not prognosticating.
I've probably held, I've held

1523
01:38:57,000 --> 01:38:59,120
enough of your time.
I really appreciate it.

1524
01:38:59,640 --> 01:39:03,840
It's been a really enlightening
conversation and I think it's

1525
01:39:03,840 --> 01:39:08,080
going to be really helpful.
I guess for for the folks

1526
01:39:08,080 --> 01:39:12,400
hanging on that run into this
situation.

1527
01:39:12,680 --> 01:39:18,840
What how does this layer of
support that you've created work

1528
01:39:18,840 --> 01:39:22,400
as opposed to how I find just
the interest I happened upon the

1529
01:39:22,400 --> 01:39:24,920
social media post like if it
could be if this is coming to a

1530
01:39:24,920 --> 01:39:28,520
community, is there it seems
there's an entity now that they

1531
01:39:28,520 --> 01:39:32,080
can reach out to.
Yeah, the the you there is

1532
01:39:32,080 --> 01:39:34,160
plural.
I, I haven't personally created

1533
01:39:34,160 --> 01:39:36,000
this.
It's a it's been an organic

1534
01:39:37,800 --> 01:39:44,440
organization that's formed in
the app Signal, where as more

1535
01:39:44,440 --> 01:39:52,200
communities and experts in
various vertical with vertical

1536
01:39:52,200 --> 01:39:56,640
expertises get involved that
we're all coming together and

1537
01:39:56,640 --> 01:40:00,000
we're, we're bringing friends in
and there's a big group of

1538
01:40:00,040 --> 01:40:03,600
people that talk all the time
and we'll reach out to other

1539
01:40:03,600 --> 01:40:07,440
communities when we hear about
proposals and offer our help.

1540
01:40:08,600 --> 01:40:12,080
If you want to find us.
I I don't have a home page for

1541
01:40:12,080 --> 01:40:16,920
doing that, but if you go.
Onto Facebook and look at any of

1542
01:40:16,920 --> 01:40:21,400
the communities that have an
active or, or even a rejected

1543
01:40:21,400 --> 01:40:23,680
proposal.
Now, whether it's Caledonia's or

1544
01:40:23,680 --> 01:40:28,360
Deforest or Port Washington or
whatever, you can find us

1545
01:40:28,360 --> 01:40:33,240
through those Facebook pages.
Just, if you just start asking

1546
01:40:33,240 --> 01:40:38,560
for help with data centers on
any of those pages, you'll get

1547
01:40:38,560 --> 01:40:40,520
to us really fast.
Perfect.

1548
01:40:40,520 --> 01:40:44,480
And we'll probably hear about
your proposal at the same time

1549
01:40:44,480 --> 01:40:48,640
you do and, and, and call and
offer our help.

1550
01:40:49,480 --> 01:40:51,120
That's what that's what we're
trying to do.

1551
01:40:51,120 --> 01:40:55,960
And in fact, there's a, there's
a meeting on Sunday out in

1552
01:40:55,960 --> 01:40:58,160
Menominee.
They've had a proposal that's

1553
01:40:58,160 --> 01:41:02,760
been sort of on and off and
community organizer out there

1554
01:41:02,760 --> 01:41:05,000
has put together a panel
discussion this Sunday.

1555
01:41:05,640 --> 01:41:11,280
So we're really active across
the whole state and, and even

1556
01:41:11,280 --> 01:41:14,120
the upper Midwest trying to help
as many folks as we can.

1557
01:41:14,120 --> 01:41:18,120
And it's, it's easy to find us.
You just drop a couple pings and

1558
01:41:18,120 --> 01:41:22,240
next thing you know it, you'll
have people offering to help and

1559
01:41:22,440 --> 01:41:26,000
provide materials that we've
gathered and prepared to help

1560
01:41:26,000 --> 01:41:30,080
educate and guide you on all the
major topics.

1561
01:41:30,360 --> 01:41:33,120
Perfect.
Well, my final note is that I

1562
01:41:33,120 --> 01:41:35,680
appreciate you doing something
you don't have to do.

1563
01:41:36,600 --> 01:41:38,960
It is actually.
I have to do it.

1564
01:41:38,960 --> 01:41:43,960
I I can't stand the imbalance.
I just it just drives me crazy

1565
01:41:43,960 --> 01:41:48,880
that small communities in
particular are getting stomped

1566
01:41:48,880 --> 01:41:51,000
on and I just want to how I have
to help.

1567
01:41:51,360 --> 01:41:55,200
Yeah, that that being compelled
or called to do something is

1568
01:41:55,200 --> 01:41:58,600
powerful, that's for sure.
So thank you for your time and

1569
01:41:58,600 --> 01:42:00,240
energy for doing it.
Yeah, my pleasure.

1570
01:42:00,240 --> 01:42:01,480
It's going to help a lot of
people.

1571
01:42:01,520 --> 01:42:02,920
And thanks for coming to chat
with me.

1572
01:42:03,040 --> 01:42:04,720
I I appreciate you having me on.