West Virginia looks to AI data center boom to help eliminate state income tax
West Virginia Gov. Patrick Morrisey unveiled a seven-point plan to attract hyperscale data centers, dedicating 50% of their revenue to eliminate the state income tax. The plan, which builds on a 2025 state law, also aims to protect utility customers and fund local infrastructure. However, local opposition is emerging in some counties due to concerns about utility costs and natural resource usage.
West Virginia Governor Patrick Morrisey has announced a seven-point plan designed to attract hyperscale data centers to the state, with the ambitious goal of using their revenue to reduce and eventually eliminate the state's personal income tax. The plan, developed in collaboration with lawmakers, allocates 50% of approved hyperscale data center project revenue to tax relief, while directing 30% to host counties for schools and local government, 10% to all 55 counties, and another 10% to infrastructure upgrades, including public water systems.
This initiative comes amid increasing national debate over data center development, balancing economic investment and job creation with community concerns over utility costs, water usage, and local control. Governor Morrisey emphasized that the strategy is proactive and designed to ensure all West Virginians benefit, building on the state's 2025 High Impact Data Center Designation (HIDC) process. His plan also addresses power grid reliability, requiring developers to collaborate with interstate grid operators like PJM.
Despite the promise of economic revitalization and tax relief, the plan faces emerging local opposition. "No Data Centers" signs have appeared in West Virginia's Jefferson and Berkeley counties, mirroring concerns from neighboring Virginia counties like Loudoun, which has seen extensive data center expansion. West Virginia House Minority Leader Sean Hornbuckle, initially a sponsor of the 2025 bill, now advocates for amendments to allow greater local control over data center development, expressing worries about a "hostile takeover in our communities."