Rep. Walsh, Sen. Coleman, legislation seeks to combat data center spread
Pennsylvania state legislators, Senator Jarrett Coleman and Representative Jamie Walsh, have introduced a package of bills to repeal tax breaks for data centers and allow municipalities to impose 18-month moratoriums on data center development applications. The proposed legislation aims to address concerns about data centers' massive energy and water use, and noise output, empowering local communities to revise zoning policies. It also seeks to redirect revenue from the repealed tax exemption to the Motor License Fund to reduce the Oil Company Franchise Tax.
Pennsylvania state legislators, Senator Jarrett Coleman (R-Bucks/Lehigh) and Representative Jamie Walsh (R-Ross Township), have introduced a series of bills in both the Senate and House of Representatives aimed at regulating data center development across the Commonwealth.
The proposed legislation seeks to repeal the state's Computer Data Center Equipment Exemption program, enacted in 2021, which provides sales and use tax exemptions for data center equipment. This incentive, according to Senator Coleman, has led to a concerning proliferation of data centers in regions like the Lehigh Valley, raising issues related to massive energy and water consumption, as well as noise pollution. The bills, Senate Bill 1344 and House Bill 2532, propose to redirect the revenue from repealing this tax break to the Motor License Fund, specifically to reduce the Oil Company Franchise Tax.
Additionally, Senate Bill 1345 and House Bill 2533 would grant municipalities the authority to enact an 18-month moratorium on both pending and new data center applications. This pause would allow local governments to revise their zoning ordinances and establish policies to address concerns such as power supply, water consumption, noise, and setbacks, thereby protecting community interests. Representative Walsh emphasized the importance of empowering local communities to protect residents from development projects posing significant risks to health, resources, and quality of life. The legislators assert that Pennsylvanians desire a more thoughtful approach to data center siting and operational requirements.