Governor’s data center committee raises concerns about tax breaks, water use
Oregon Governor Tina Kotek's Data Center Advisory Committee has released a preliminary report highlighting concerns about data center tax breaks, water, and energy use. The report, open for public comment, follows significant public opposition and has led Governor Kotek to propose a one-year moratorium on data center approvals on state land. The committee emphasized the need for better oversight and information on the industry's impacts.
The Data Center Advisory Committee, appointed by Oregon Governor Tina Kotek, has published a 20-page report of "preliminary learnings and questions" after nine months of fact-finding meetings. The report, which is open for public comment until October 24, highlights the need for greater oversight of the data center industry and a centralized repository of information regarding data centers' type, water and energy consumption, and state tax incentives. The committee's findings come amidst growing public backlash against data center proliferation in Oregon, a sentiment echoed by gubernatorial candidates Kotek and state Senator Christine Drazan.
Governor Kotek recently announced her support for a statewide data center moratorium, proposing a one-year pause on approvals for new data centers on state-owned land or in state buildings. She noted the state's limited authority to implement a broader, all-out moratorium. The committee has received over 700 written and nine hours of verbal comments, with approximately 90% expressing opposition, largely centered on utility affordability.
The report acknowledges that Oregon, a top 10 US market for data centers, has attracted facilities for over two decades due to a lack of sales tax, moderate climate, cheap electricity, and generous property tax incentives. However, the committee identified a significant lack of transparency due to non-disclosure agreements. An ECOnorthwest analysis revealed 123 to 144 facilities in the state, with approximately 9,000 acres proposed for future development, many in rural areas.
Key concerns raised include increasing energy and water demands, with water quantity seen as a greater issue than quality due to competition with irrigation. The committee also questioned the financial benefits, noting that Morrow County's assessor reported $7.2 billion in tax-exempt data center property value for 2025, exceeding the county's total taxable property value. The report refrained from specific policy recommendations but posed questions on balancing investment attraction with community benefits.