West Virginia’s governor courts data center industry as Virginia mulls ending tax exemptions

West Virginia Governor Patrick Morrisey has publicly invited data center companies to his state, capitalizing on Virginia's ongoing budget dispute over proposed early termination of data center tax exemptions. Morrisey highlighted West Virginia's streamlined regulatory process, quicker build times, and innovative energy legislation, including a bill passed in the 2025 session to create energy microgrids and exempt data centers from local zoning ordinances. This push has already led to two data center announcements for West Virginia, including one from Google. In contrast, Virginia's General Assembly is at an impasse regarding its biennial budget, specifically on whether to end sales and use tax exemptions for data centers in 2027, rather than their scheduled expiration in 2035. The state Senate's budget proposal includes the early end, creating a $1 billion revenue difference with the House's plan. This debate has sparked warnings from lawmakers like Sen. Tammy Mulchi and Del. Eric Phillips that Pittsylvania County could lose a significant $73 billion Stack Infrastructure project at the Berry Hill megasite, which promises over 2,000 jobs. Secretary of Finance Mark Sickles echoed these concerns, stating the project's fate depends on maintaining Virginia's competitiveness. While Senate Majority Leader Scott Surovell believes a compromise is possible, House Minority Leader Terry Kilgore warned that industry investment is "highly competitive" and data centers will seek more favorable environments if Virginia's policies shift. The Data Center Coalition's president, Josh Levi, confirmed that the industry has offered compromise proposals, which have been rejected, and emphasized the mobility of data center investment. The budget must be resolved by June 30.