Ohio targets $40 billion data center boom with local votes, pollution rules, and no tax breaks
Ohio lawmakers have introduced House Bill 983, a sweeping proposal that would require voter approval for data center projects over one megawatt, including expansions, extending this requirement to municipalities within a five-mile radius. The bill also includes new pollution regulations for air and water discharge, holds developers liable for water supply impacts, and bans property tax breaks. This legislation aims to address public concerns over electricity and water strain, environmental impact, and tax incentives, potentially making future data center developments significantly harder to build.
Ohio's state lawmakers have introduced House Bill 983, a comprehensive proposal aimed at regulating the state's burgeoning data center industry, which is projected to attract $40 billion in investment over the next four years. The bill mandates voter approval for any data center project or expansion exceeding one megawatt of peak electric load, with the requirement extending to all municipalities and townships within a five-mile radius of the site.
The proposed legislation also targets environmental impacts and resource use. It would hold data center developers liable for local water supply and pressure impacts and impose new air-emission and water-discharge limits for various compounds, including PFAS, glycols, and metals, which would apply to existing facilities after 18 months. Furthermore, House Bill 983 seeks to eliminate property tax breaks for data centers and associated power plants offered by local governments, while making all development and supply agreements publicly disclosable.
Proponents of the bill cite concerns that large data centers strain electricity and water systems, potentially leading to higher utility rates for residents. They also highlight issues like wastewater discharge, air emissions, noise, visual impact, and the controversial use of tax incentives. Critics, however, argue that requiring repeated community-wide votes could effectively halt most new projects, slowing economic development and costing the state billions in potential revenue.
Whether House Bill 983 advances or not, it signifies a shift in the narrative around data center growth in Ohio, moving beyond purely economic considerations to encompass debates over energy, water, pollution, and the extent of public control over local development. The outcome of this legislative effort could serve as a precedent for other states grappling with similar issues.