The cost of wooing Google to the state's foothills could far exceed initial estimates, with tax breaks and other public incentives potentially reaching $260 million.

That is one of the richest packages of recruiting perks ever offered in North Carolina, and one negotiated in strict secrecy. Indeed, new records made public this week give striking detail about government officials' closed-door efforts to get Google to Lenoir.

The company last month announced plans to build a data center in the Caldwell County community, creating as many as 210 jobs and investing $600 million.

City and county leaders waived 100 percent of Google's business property taxes and 80 percent of its real estate taxes for 30 years to get the operation. But they have not publicly disclosed how much revenue the breaks could cause them to forgo.

The new records give the first indication: $165 million over three decades. That figure, included in a document filed on behalf of Caldwell County but challenged by one county official, is in addition to tax breaks and grants approved by the state that could reach $94 million during the same period. Initial estimates of the incentives package were based on that state figure.

And more public money could go to the project. The Department of Transportation has estimated it will spend $700,000 on road work near the Google site. The county wants $222,550 from another pot of public funds to offset the expense of preparing the location.

"The number and scale of economic incentives for which Project 'Google' is eligible are virtually unprecedented in N.C., but so are the potential long-term benefits," states a request to the Golden LEAF Foundation filed by a regional development group for Caldwell County. Golden LEAF oversees state money used for economic development.

Enticements defended

Recruiters defend the incentives, saying Google could transform a community devastated by declines in furniture manufacturing. They say aggressive enticements were necessary to keep the jobs, with average salaries of $48,000 per year, from going to South Carolina, New York or another rival location.

"In the case of this project, the vast majority of the incentives are taxes we would not pay in other states," Google spokesman Barry Schnitt wrote in an e-mail message in response to The News & Observer. "They level the playing field."

He pointed out that Oregon doesn't have a sales tax, and Iowa and Virginia have exempted computer-related industries from certain taxes.

The actual value of North Carolina's enticements depends on how much Google invests. If it meets all its projections, then the total could reach $260 million. That's almost on par with the $280 million in incentives offered in 2004 to win a Dell plant in Winston-Salem. The computer maker promised 1,500 jobs with an average salary of $28,000.

Google pushed hard, and at times with a heavy hand, for the lucrative state incentive it received. The General Assembly last year approved a measure eliminating sales taxes on electricity and equipment that the company buys in the state.

The company's representatives grew frustrated with the legislative process, the documents show, and at one point threatened to pull the project if the bill lacked language that they wanted. They also threatened to walk if lawmakers tied Google's name to the legislation or the state.

Local negotiations appear to have been considerably easier.

On Feb. 6, 2006, Caldwell County and Lenoir leaders privately offered to waive 100 percent of Google's property taxes and 75 percent of its real estate taxes for 15 years. Two days later they upped the offer to 20 years, according to a letter signed by the chairman of the county commissioners and Lenoir's mayor.

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