What to know about Pennsylvania’s data center tax exemption and the shifting attitudes surrounding it
Pennsylvania is facing growing controversy over its data center tax exemption as officials, developers, labor groups and residents debate the economic benefits and environmental and infrastructure costs. Opposition has halted NorthPoint Development’s Project Hazelnut in Hazle Township through a zoning denial and lawsuit, while residents have also challenged a TECfusions project in Upper Burrell Township.
Pennsylvania’s Computer Data Center Equipment Exemption Program has attracted major investment but is projected to cost the state nearly $1.9 billion in foregone tax revenue over seven years. Gov. Josh Shapiro initially promoted data center development and fast-track permitting, including Amazon-backed Project Hazelnut in Hazle Township, but later removed data centers from the fast-track program and introduced stricter Governor’s Responsible Infrastructure Development Standards tied to state permits and tax benefits. A legislative effort by Rep. Greg Vitali to repeal the exemption passed the House but remains stalled in the Senate.
Local resistance has intensified in areas hosting proposed facilities. Hazle Township denied NorthPoint Development’s zoning approval after residents raised concerns about land clearing and environmental impacts; a county court upheld the decision, and NorthPoint has appealed to the Commonwealth Court. In Upper Burrell Township, supervisors approved TECfusions’ land development plan despite opposition, prompting residents and Protect PT to file a land-use appeal. Both townships adopted temporary data center moratoriums while developing local rules, and Upper Burrell later passed a data center ordinance. Supporters, including construction unions, emphasize jobs and investment, while opponents argue that communities bear risks involving water, pollution, noise, electricity and inadequate local oversight.