Nevada lawmakers could hit pause on data centers, end their tax breaks
Nevada lawmakers are considering a 2027 bill to end tax breaks for AI data centers and impose a statewide pause on new facility construction and expansions. This legislative effort stems from concerns over water use, energy demands, and environmental impacts, with proponents highlighting the need for public policy to address these issues. The bill's proposal by the state's interim standing committee on revenue has sparked debate among officials and industry supporters.
Nevada lawmakers are considering a significant statewide bill that would halt tax abatements for AI data centers and implement a moratorium on new facility construction and expansions. The state's interim standing committee on revenue voted 6-2 to draft the bill, which is slated for consideration in 2027. Senator Dina Neal, D-North Las Vegas, who chairs the committee, emphasized the need for a unified state standard to address growing concerns about water usage, energy demands, and environmental pollution associated with data center development.
The proposed legislation targets the state's current tax abatement program, which allows data center developers to receive a 75 percent abatement on personal property taxes. This program has become an election issue, with Democratic gubernatorial candidate Aaron Ford vowing to end the abatements, while incumbent Governor Joe Lombardo, a Republican, generally supports data centers but is evaluating their community impacts. The article highlights that data centers could account for 64 percent of NV Energy's sales by 2046, up from 5 percent, potentially jeopardizing the state's clean energy goals.
Opposition to the bill came from Assemblymembers Lisa Cole and Jason Patchett, Republicans from Clark County, who argued against an outright revocation of abatements, preferring legislation that would help counties negotiate development agreements. Storey County Commissioner Clay Mitchell also spoke during public comment, advocating for modernizing the abatement structure rather than abolishing it. He underscored the economic benefits, citing 8,000 to 10,000 high-paying union jobs in the Tahoe-Reno Industrial Center that provide long-term stability for construction trades.