National View: Data-center moratoriums penalize public schools, taxpayers
An opinion piece argues that data center moratoriums harm public schools and taxpayers by reducing funding and increasing tax burdens. It contrasts New York's enacted statewide moratorium with Loudoun County, Virginia's economic growth attributed to data centers. The author advocates for highlighting the financial benefits data centers bring to communities.
Paul Steidler, a senior fellow with the Lexington Institute, argues that the increasing number of data center moratoriums primarily harms public schools and homeowners rather than large tech companies. He contends that such moratoriums lead to fewer resources for schools and higher property taxes for residents, as tech companies have numerous alternative locations for development and a proven record of positive community transformation through binding legal agreements.
Steidler highlights New York Governor Kathy Hochul's executive order imposing a one-year statewide moratorium on data centers requiring over 50 megawatts. This decision has created uncertainty for Genesee County, upstate New York, which anticipated $1.3 billion in new wages and $286 million for municipalities and schools from a planned data center. In stark contrast, Loudoun County, Virginia, a region with the highest concentration of data centers, has cut property taxes for ten consecutive years, built new schools, and boasts significantly higher per-pupil spending. Loudoun County projects $1.2 billion in total data center taxes for fiscal year 2027.
Further examples of data center benefits are cited, including a Louisiana school district offering over $50,000 teacher bonuses due to a data center, and Missouri Governor Mike Kehoe's announcement of an Amazon data center in Montgomery County promising hundreds of millions in property tax revenue. Columbia County, Georgia, also aims to substantially reduce residential property taxes through payments from two planned Google data centers. A PwC report indicates the data center industry contributed $204.4 billion in local, state, and federal taxes in 2024, a 24% increase from 2023.
Steidler concludes by emphasizing the urgent need for companies and community leaders to clearly articulate the benefits data centers provide to students, teachers, and taxpayers. He urges them to challenge proponents of moratoriums, including federal legislators like Senator Bernie Sanders and Representative Alexandria Ocasio-Cortez who are calling for a potential national moratorium, to explain why the public should bear substantial tax burdens instead of tech companies.