Debate on tax incentives stalls Ohio data center legislation before Statehouse break
Ohio lawmakers failed to pass new legislation, House Bill 646, concerning data center tax incentives before their summer break. The bill aimed to limit sales tax exemptions previously granted to data center developers, which Governor Mike DeWine had already paused due to higher-than-expected revenue costs. The debate will likely resume in November.
Ohio legislators concluded their session without reaching an agreement on new data center legislation, House Bill 646, which aimed to set state policy and limit sales tax exemptions for data center developers. Despite working late into Wednesday night, the House and Senate adjourned, postponing further consideration of the bill until potentially November, after the elections.
The debate over tax incentives proved contentious. Ohio Development Director Lydia Mihalik informed the Joint Data Center Committee that the decade-long sales tax exemptions had served their purpose and should be capped moving forward, suggesting it would be the "most prudent thing to do." However, some House Republicans opposed limiting the breaks, instead advocating for their complete elimination.
Governor Mike DeWine had already paused these tax exemptions last month after state leaders discovered they were costing Ohio billions more in lost revenue than initially projected. Senator Brian Chavez acknowledged that past exemptions for high-cost projects were "baked in," and Representative Chris Glass Burns expressed frustration that lawmakers left without a resolution, criticizing the Department of Development for not providing accurate cost figures for the tax breaks. House leaders plan to reconvene representatives on June 24th, though it is unclear if this specific bill will be addressed then.