"Data Center Alley" in suburban Virginia may be hitting a dead end
Loudoun County, Virginia, has built a large tax base around its dense concentration of data centers, but older facilities are depreciating and generating less revenue. Residents are increasingly opposing new data centers over their power and water use, while county officials consider how to manage future declines in tax revenue.
Loudoun County, Virginia, known as “Data Center Alley,” receives nearly 40% of its tax revenue from data centers and has used that money to fund schools, roads and lower property taxes. But older facilities depreciate, reducing their tax contributions and creating pressure to approve new construction to maintain revenue growth.
Residents have pushed back against further development, citing data centers’ electricity and water consumption as well as their proximity to homes. County Commissioner of the Revenue Robert Wertz and Budget Director Megan Bourke said Loudoun has some flexibility through a Revenue Stabilization Fund, though officials may eventually need to raise other revenue or reduce spending as data center tax receipts decline.