State and local governments are facing opposition from taxpayers about the proliferation of data centers, which are generating tax revenue but also affecting water and electricity infrastructure.
"There's something just wrong or unfair about having a power line go through your community that you have to pay for to power data centers," said Rep. Suhas Subramanyam, the Democratic representative from Virginia's 10th district.
"They (supporters) say it's great for the locality because they'll pay for schools. But you're paying for it. Would you rather have a little property tax increase, or would you rather have a giant utility bill increase and a power line going through your school or home?"
The comments came on Tuesday during a panel discussion at the Brookings Institution in Washington D.C.
The congressman's district includes "data center alley," a heavy concentration of data centers located in Loudoun County near Dulles International Airport, which is about 25 miles west of downtown Washington D.C.
Subramanyam has introduced four pieces of legislation to reckon with the impact data centers are inflicting while predicting an ongoing patchwork of moratoriums.
"If we do nothing, I think that moratoriums will win," he said. "It won't be a national moratorium passed by Congress. It will be every state basically passing a moratorium because of the politics."
The data center industry is expected to produce $1.3 billion in tax revenue for Loudoun this year, but the public is becoming increasingly hostile to new builds.
Loudoun County Board Member Juli Briskman is proposing two amendments that would temporarily curb data center development and permanently end their by-right development.
The disagreements over future data center developments and tax breaks reached Gov. Abigail Spanberger's desk earlier this year as she gently pushed back on calls to end the sales tax exemptions that were signed in 2010.
Opponents to the exemptions point to an estimated $1.9 billion in lost revenue for a business that provides low numbers of permanent jobs and strains utility systems that serve them.
Several other states using the same tax tactic are now expressing second thoughts by hitting the pause button via moratoriums or by ending the exemptions.
President Trump waded into the debate by extolling data center's ability to lower property taxes.
The One Big Beautiful Bill Act includes provisions that allow immediate deductions for equipment purchases as opposed to being depreciated over time.
The debate over data centers continues to influence political positions heading into the midterms as pro-business Republicans look for positions that will appease a majority of voters who are opposed to building them anywhere.
Brookings cites a Reuters/Ipsos survey showing that 64% of the respondents do not think it is a good thing to build data centers at a rapid rate.
The survey shows 77% of the respondents worried that data centers will increase their electricity rates, and only 14% say they would be willing to live close to one.
Earlier this month S&P Global Ratings took a look under the hood of the "hyperscalers" who are helping to power the rise of the artificial intelligence and growing cloud storage needs serviced by data centers.
According to S&P, "Capital expenditure by Alphabet, Amazon, Microsoft, Meta, Oracle, and SpaceX will reach $1.3 trillion in 2027, we estimate, a near tripling from two years ago."
"The credit quality of hyperscalers is gradually weakening. Every time we take a deep dive into this sector, we find that capex is rising faster than we anticipated, financings are becoming more complicated and less transparent, and that returns on investment will take years to realize."
