Could data centers boost Appalachian Ohio? Experts say it’s complicated

The article explores the complicated promise of data center developments in Appalachian Ohio, a region struggling with economic distress since the decommissioning of a uranium enrichment plant in 2001. A proposed data center in Pike County, potentially the country's largest, was met with initial enthusiasm by officials like Commissioner Tony Montgomery, who sees it as a vital economic boost. Similarly, Adams County considers data centers for former power plant sites, and Washington County is also expecting development. However, local residents and economic experts express significant skepticism, drawing parallels to past industrial projects that yielded more harm than good, such as C8 and Dupont's impact in Washington County. Jennifer Dusky, a Washington County resident, voiced concerns about land affordability and the area's natural resources being exploited. Experts like Ball State economics professor Mike Hicks argue that while data centers are attracted to cheap land and willing local governments, they offer few permanent jobs and the economic benefits are often overstated, especially when considering the significant tax incentives offered. The article highlights Ohio's efforts to attract data centers through sales tax breaks, competitive electricity rates, and property tax abatements, leading to the state becoming a major hub for the industry. However, critics, including Sean O'Leary from the Ohio River Valley Institute, contend that generous incentives create a "race to the bottom" that diminishes the financial benefits for communities. The true job creation impact is debated, with direct employment figures much lower than the "indirect and induced" numbers often cited by industry reports, and concerns about whether jobs are truly new or simply shifted from elsewhere. The issue of tax abatements is a major flashpoint. Scioto County approved a 75% tax abatement for a Google data center, negotiating a $500,000 annual payment-in-lieu-of-taxes (PILOT), which some residents deem insufficient given rising electricity costs and water impact. Adams County commissioners are considering a 75% to 100% abatement for an Amazon project, and Washington County may approve a 100% abatement while negotiating a PILOT. Experts like Hicks argue that net economic positives disappear once municipalities grant these significant tax breaks, underscoring the need for communities to carefully consider opportunity costs and negotiate robust revenue streams if they pursue data center developments.