Part of Big Tech's War on Users Back in January, Brad Smith stood up in Washington and launched Microsoft's Community-First AI Infrastructure initiative. Five commitments. Pay their way on electricity. Replenish the water. Create local jobs. Add to the tax base for hospitals, schools, parks, and libraries. Invest in local AI training and nonprofits. Microsoft was going to be a "good neighbor," and it was going to "set a high bar." Nine months later, per Ars Technica, a group of churches in northern Indiana asked Microsoft how high that bar actually is. Microsoft hasn't answered. The Neighborhood The site is in Granger, in St. Joseph County, just outside South Bend. It's a $1 billion, 900-acre data center, with construction starting this fall and operation targeted for 2029. Indiana rolled out the red carpet for this kind of thing years ago. Qualifying data centers can buy their equipment without paying the state's 7% sales tax, and projects over $750 million can lock that exemption in for up to 50 years. Fifty. Mirror Indy, working from a state tax incentive report, figured the big players could qualify on anywhere from $2.2 billion to $13.2 billion in equipment purchases. At 7%, that's up to $900 million in sales tax the state never sees. Meanwhile, St. Joseph County's local governments are dealing with a state property tax bill that squeezed their ability to raise revenue. Bus lines, health care, child care. The usual stuff that gets cut first. So a coalition of about 25 congregations and community groups called We Make Indiana did the reasonable thing. They sat down with Microsoft's liaison, in a church, and handed over a proposal. The Ask They called it a Fair Share Agreement. Microsoft would pay a percentage of the data center's annual costs into a community fund, every year, from construction through the life of the facility. An independent board would decide where the money goes. It would be binding. Here's the part the Ars headline undersells. They never demanded 1%. Internally they'd kicked around 1 or 2 percent, and figured even 1% could bring in something like $30 to $40 million a year. But the proposal itself asked Microsoft to come back and say what it thought was fair. They didn't slap a number on the table. They asked Microsoft to name one. That was May. The Answer What they got instead, per a company liaison, was up to $1 million in one-time nonprofit donations. Total. The spokesperson line to Ars was the classic: they value the input, it's an important part of the listening process, it's too early, investment decisions haven't been made. Some initial grants have gone out, amounts undisclosed. So far the priority has been educational nonprofits and a community college. To teach people AI skills. Which, to be fair, is literally commitment number five. "Invest in local AI training." I just want to point out that a company whose entire growth story right now is selling AI has found that the most pressing need in a struggling county is… more people comfortable using AI. Funny how that works. I can't read that grant list without picturing Kronk at the dinner table. Oh right, the fuse. The fuse that is burning. The fuse that we've been racing to stay ahead of. When you're sprinting to find something sticky enough to outrun the burn rate, nothing buys runway quite like a fresh batch of future users, trained up on the county's dime. Ryan Juskus, one of the group's leaders, put it more bluntly than I would have: the grants aren't proportional, aren't ongoing, and are entirely on Microsoft's terms. Mostly, he said, they "buy silence." "Maybe It's Just Not Profitable at 1%" That was my first gut read too. And I don't think it's the actual reason, because the numbers don't support it. Even using the coalition's own estimate, $30 to $40 million a year is small next to a 50-year sales tax exemption, let alone what Microsoft is spending on AI buildout across the country. I'd bet this site doesn't stop making money at 1%. I really doubt anyone at Microsoft is looking at a spreadsheet where Granger goes red over a community fund. What 1% does is set a precedent. If Granger gets a binding, independently governed fund, every county Microsoft builds in next gets to point at it. "You did it for South Bend." And Microsoft has already broken ground on a second northern Indiana site, so that's not a hypothetical. Stand.earth is working with We Make Indiana and with groups near other Microsoft sites. Somebody's writing this template down. And it's showing up in legislation too. Pennsylvania state Sen. Lindsey Williams' Data Center Fair Share Act would require binding community benefits agreements, with at least 10% of total project cost, and the community deciding how it's spent. Governor Shapiro has since signed an executive order that requires developers to negotiate a community benefits agreement once a municipality approves a project. So the thing Microsoft won't discuss voluntarily in Indiana is becoming mandatory one state over. A signed 1% deal in Granger doesn't just cost 1%. It makes "these agreements are unworkable" a much harder argument to make in every statehouse considering 10%. It's Also About Who Holds the Checkbook The other half is control. The $1 million in grants: one-time, discretionary, recipients chosen by Microsoft, and conveniently on-message. The Fair Share Agreement: ongoing, binding, and an independent board deciding where the money goes. One of those is a press release. The other is an obligation. It's worth reading the tax line of the pledge closely, too. Commitment number four says Microsoft won't ask local municipalities to cut their property tax rates. A 50-year state sales tax exemption isn't a municipality being asked for anything. It's just sitting there, available, and Microsoft stands to benefit enormously from it. The pledge is technically honored. The county still gets squeezed. The Sticky Note Wall My favorite detail from the Ars piece is how Microsoft runs these community sessions. According to Nathan Taft at Stand.earth, it's not one speaker taking questions in front of the room. It's five or six reps scattered around, residents clustered in little groups, and when someone asks something hard, it goes on a sticky note that gets stuck on the wall. Think about what that format does. Nobody ever hears anyone else's hard question. Nobody hears the non-answer. The room never becomes a room. Every concern gets "heard" individually and then quietly disappears into a stack of Post-its. When a group member with a background in environmental policy asked how Microsoft planned to handle decommissioned materials, the rep didn't have an answer. The liaison who took the proposal admitted it was beyond her boss's purview. A different Microsoft rep, on local radio, said the proposal wasn't on his radar. That tells you the decision isn't being made in South Bend, and nobody who could make it is showing up to the open house. In June I wrote about OpenAI in Saline Township, where the township said no and the answer was, basically, lawyers. Even that version ended with $14 million to the township and fire departments, plus another $10 million for the rec center. The template OpenAI sued its way into still paid out more than Microsoft's entire offer to South Bend. Microsoft's version is politer. No lawyers needed. Just a very nice listening session and a wall full of sticky notes. They Might Have Picked the Wrong Congregation Here's why I'm not writing this one off, though. We Make Indiana has been organizing since 2024, building on a group that goes back to 2018. They already rallied hundreds of people to a public meeting that ran until 4 a.m. and got a rumored Meta data center blocked. They're not trying to stop the Microsoft project. They want it done proportionally. And they've found leverage. The county's economic development director wants to set up a tax increment financing district around the Microsoft site. If you've never had to care what a TIF is, lucky you. The short version: the county draws a line around an area and freezes the property tax base at today's value. As development pushes values up, the new property tax money above that frozen baseline doesn't flow to the usual places like schools, libraries, and the general budget. It gets set aside and spent inside the district, typically on roads, utilities, and other infrastructure that makes the development work. It's often pitched as the project paying for itself, but in practice, a chunk of the tax growth a giant data center would normally generate for the whole county gets walled off and funneled back into the site. Microsoft hasn't publicly backed the TIF, but locals figure it would benefit, and worry it could fund future expansion. So it's another incentive on top of the 50-year sales tax exemption. And every incentive the county still has to hand out is a bargaining chip. The group's pitch to county officials is simple: No TIF without a Fair Share. On Tuesday, September 22, clergy were at the County-City Building in South Bend asking county officials to do exactly that. They want it to be an election issue this fall. Andre Stoner, a former pastor who leads the group, framed it as a question of power: does Microsoft think it needs to talk to them at all? That's the real question. Microsoft wrote "good neighbor" in a five-point plan and put it on a handout with a QR code. A good neighbor, when asked what they think is fair, says a number. Even a low one. Microsoft said "it's too early." County officials may get to decide whether it's too early for a TIF, too. I'll check back after the election. Find me on Mastodon at @ppb1701@ppb.social.