Facebook contractors

Miles Gossett, general manager for Skilled Trades, left, chats with Jeff Richins, a lead estimator with Jacobsen Construction, during a Facebook Data Center construction meet-and-greet with potential subcontractors and vendors held at Las Lunas High School.

LOS LUNAS — The general contractor of the Facebook data center in Los Lunas said it is willing to be flexible on some of the requirements it has for subcontractors and that it is committed to hiring locally.

Fortis Construction of Portland, Ore., released a statement in response to criticism from the construction industry here about the standards to which potential subcontractors would be held.

At a meeting last month for potential subcontractors and vendors, Fortis said in addition to an excellent safety record and experience working on large projects, the businesses that subcontract with the company directly would need to have no more than 20 percent of their annual revenue coming from the data center project.

The president of the Associated Builders and Contractors of New Mexico said she was “shocked and dismayed” that Fortis would impose a revenue requirement that would likely exclude many local subcontractors.

Downey & Co.’s Chris Downey, who specializes in contract bonds and insurance for commercial contractors, called the 20 percent requirement “preposterous” and “elitist.”

In a statement emailed to the Journal, Fortis has clarified its position, saying the 20 percent threshold is a guideline and one of many factors the company will take into consideration.

“It’s very important to us and to Facebook that we hire local contractors,” said Fortis executive vice president David Aaroe in the statement. “As part of our vetting process, we require primary subcontractors to have a plan in place to hire locally.

“The 20 percent target is flexible and we take into account multiple factors to gauge a subcontractor’s financial stability, safety records, and past performance on similar projects.”

The data center is the largest capital investments in New Mexico in recent memory. The first phase of the project is expected to take two years to complete and cost $250 million. Over seven years and multiple phases, the data center is expected to generate up to 500 construction jobs.

To incentivize the social media giant to choose New Mexico for its new data center, Facebook was offered $10 million in Local Economic Development Act funding in addition to a gross-receipts tax reimbursement of up to $1.6 million annually and $30 billion in industrial revenue bonds that act as a property tax break.

There currently is no legislation requiring companies that are the recipients of such incentive packages to hire locally, though both Facebook and Fortis have consistently stated they are committed to doing so.

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