General Assembly to consider comprehensive study on data centers
As the June 30 budget deadline nears, the Virginia House of Delegates and Senate are still unable to agree on tax breaks for data centers.
The House Appropriations Committee announced a budget conference proposal on June 12 that doesn’t require data centers to meet environmental standards to be exempted from the state’s 5.3 percent sales and use tax. That issue has been a matter of contention, stalling budget negotiations for weeks.
Instead, it calls for the establishment of a commission to develop a comprehensive study on data centers. The final report is due Nov. 1.
Related story: Board approves land sale for a data center
The sales tax exemption helps data centers save about $1.6 billion a year, mostly on expenses for replacing and upgrading computer equipment.
According to the Virginia Mercury, House Speaker Don Scott (D-Portsmouth) has supported the tax breaks because of the local tax revenue data centers generate and the union jobs that come with their construction. He urges the Senate to support the budget compromise package.
Related story: BoS backs data center industry on substations, rejects residents’ concerns
The House Appropriations conference proposal includes the following language on the commission’s study on data centers:
- The commission will thoroughly evaluate the direct and indirect costs and benefits of the data center industry, with a report and recommendations for legislation to address the financial, energy, air, water, and noise impacts in time for consideration by the 2027 General Assembly.
- The commission “will ensure energy demands generated by data centers are not borne by residential ratepayers.”
- The commission “will investigate all elements of data center impacts, including community benefits agreements.”
- The commission will “consider the importance of the data center industry to revenue streams for local governments – including those with large industry presence and those interested in attracting future development.”
- The commission will consider future potential strategies for generating additional state revenue from the data center industry.
Related story: Dominion sale raises alarm bells
Little late to the party, no?
Virginia already has more data centers than any other state (609ish). Loudon itself the most in the world. And now along comes Fairfax deciding to study the situation. Drag it out a while and Texas will overtake VA.
Fairfax?
Where is FFX county involved. This is about the state budget.
Thanks. I don’t know why I goofed like that. Must’ve got hold of some bad AI.
The committee will ensure,investigate,have meetings on how to manage the data centers.Tax breaks for data centers. Hmm ..It will generate some jobs..But the construction jobs workers are brought in from other states.When they are done.they go home.The data centers employ locals but only a certain number of employees are needed. It is not worth the cost. The governor vetoed the Fairfax center.Citizens don’t want the centers .Yet the politicians push for it..And don’t stop..Learn from the coalition of Fairfax citizens who opposed the center in Tyson politicians..
It seems wild that data centers need tax breaks when they’re supposedly driving the greatest wealth amd productivity generation in the country. Forecasts estimate global capital expenditures in the sector could reach up to $7 trillion by 2030.
Do data center fat cats really need socialized federal and state support by way of tax breaks and exemptions to pollute our environment? Do they need welfare more than living, breathing human citizens? I think not. And who will pay to remidate the environmental damage? It clearly won’t be paid for by the tax dollars that the pollutors didn’t pay!
Agree with Wild. Why do they need tax breaks? And how about they pay for trucking in their own water and pay for any upgrade for electricity they need rather than have taxpayers foot the bill? And NO CASINO in Tysons will not be overcome!!
Data centers pollute our waterways. Stopping data centers locally is so much more important than trying to stop global warming.