Nebraska data centers have received $519M in property tax exemptions since 2021

Nebraska Governor Jim Pillen issued an executive order on Monday to halt state business tax incentives for data centers and establish a task force to review related policies. The move comes as figures from the governor’s office reveal that data centers have received an estimated $519 million in property tax exemptions since January 1, 2021, and are projected to receive incentives totaling millions more through June 30, 2026. This includes $15 billion in exempted personal property.

While the order initially specified "large-scale" data centers, Governor Pillen clarified that all data centers, regardless of size, would be ineligible for Nebraska Imagine Act credits and tax incentives moving forward. He emphasized that the action is not a moratorium on data centers but a measure to ensure the state's best interests for its land and water. Maureen Larsen, director of economic development, stated the necessity of assessing potential benefits and drawbacks before granting state incentives. The state auditor earlier this year reported that business incentives have cost Nebraska over $1.2 billion in lost revenue.

The executive order effectively blocks rebates for property and sales taxes paid by data centers and mandates the formation of a task force to provide recommendations to the legislature. Local governments across Nebraska, from North Platte to Nebraska City, have been grappling with data center development through measures like moratoriums and recall votes amid community concerns. Companies such as Google, with a data center in Lincoln, and Monolith, with a proposed center in Hallam, have not yet commented on the development.