Wisconsin and Ohio lawmakers are diverging on data centers as grassroots opposition grows in both states.
In Wisconsin, four bills regulating data centers failed before lawmakers ended the general business session for the year.
Ohio's legislature is considering multiple bills, including a bipartisan bill to end data center tax exemptions.
The Ohio Ballot Board also approved residents' proposed constitutional amendment this month banning big data centers. If it gathers enough signatures, it will be on the November ballot.
In an April 7 outlook report, Municipal Market Analytics estimated more than $5 billion in state and local tax revenue is lost to data center incentives annually.
"It's a competitive landscape," said Rod Carter, partner at the law firm Husch Blackwell, which released a
Thirty-six states have incentives, the Husch Blackwell report said. Wisconsin's tax exemptions span the sale, storage and use of equipment or software; data center development, construction and expansion costs; lease payments; and engineering and design costs.
Ohio exempts qualifying data centers from taxes on the sale, storage and use of equipment.
As a land use lawyer, Carter said he's noticed a shift. "Projects a year or two years ago were being approved much more easily than they are today," he said. "There's more resistance out there... Some states may say, 'Heck, no, we don't want to offer this type of incentive.'"
Decisions about tax policy must be made at the state level, Carter said. While tax increment financing districts incentivize development locally, they only "come into play when the data center or company has made the decision that they want to come to (a state)," he said.
There are 90 data center campuses in Ohio — 55 live locations, 13 under active construction and 35 sites with committed or early-stage capacity — according to Lilli Flynn, senior analyst at
Wisconsin has 22 data center campuses: 14 with live capacity, two under active construction and six in earlier development phases, Flynn said by email.
Data centers require a great deal of power for operations and water for cooling.
Ohio's electricity costs have surged in recent years. Prices rose 53.3% from March 2021 to March 2026, according to
"Without strong agreements, part of the cost can still fall on utilities and ratepayers," said Shaolei Ren, associate professor of electrical and computer engineering at the University of California, Riverside, who co-authored the paper.
"Meeting data centers' peak water demand is often difficult," he said by email. "Water availability and infrastructure capacity should require careful consideration… because annual averages can hide serious peak-day constraints."
Nearly 70% of Wisconsin voters now believe the costs of large data centers outweigh the benefits,
"Right now, the vibe is not super happy," said Anna Haensch, associate research professor at the University of Wisconsin's Data Science Institute. "One thing that has bred anger in a lot of communities is things were happening under (nondisclosure agreements) and behind closed doors, and community members felt blindsided."
Haensch suggested more reliance on community benefit agreements, which are common in the offshore wind industry.
Absent movement from the statehouse, some Wisconsin municipalities are acting on their own. On April 7, Port Washington citizens
The area includes family farms, already under strain, and "they can be easy fodder for these data center developers," said Christine Le Jeune, founding member and spokesperson for Great Lakes Neighbors United, the group behind the TID measure in Port Washington, a city of 12,750 25 miles north of Milwaukee.
"It was the result of many months of frustration that people experienced in speaking out to the common council," Le Jeune said of the TID change.
The city welcomes "any opportunity for our citizens to engage in local government," and has the utmost respect for the democratic process, Mayor Ted Neitzke IV said by email.
"However, we are concerned that there may be unintended consequences," he said. "This may send a signal that our city is not open to additional new investment, and may put us at a competitive disadvantage to other municipalities."
Neitzke pointed to the lawsuit the ordinance faces from the Metropolitan Milwaukee Association of Commerce and other business groups. Great Lakes Neighbors United has
Port Washington is not fiscally desperate. The city's general obligation debt is rated A1 by Moody's Ratings — which noted Port Washington's strong financial position, growing population and balanced operations — and AA by S&P Global Ratings.
Yet the city granted the developer local TID incentives of about $458 million, and together with the state exemption, "we're seeing just tax breaks all the way down," Le Jeune said.
A spokesman for Vantage did not respond to requests for comment.
Governments shouldn't give data centers tax exemptions, said Prescott Balch, a retired technology executive and resident of Caledonia, Wisconsin, which
"I call it one-move chess," he said. "The outsized nature of it in some communities in Wisconsin is just insane."
Balch said he'd like to see concentration risk play a bigger role in decisions. "There's a particularly toxic mix of small communities and large data centers… you create a financial concentration risk," he said. "The technology industry itself is always running to the next new thing, and has very little reverence for its past. You amplify the risk with what essentially is a relatively volatile (asset) over the long haul."
In the city of Menomonie, population 16,709, a Delaware shell company, Balloonist LLC, is trying to develop a $1.6 billion data center on 320 acres of land. Meta used the same LLC for its Beaver Dam project,
Meta did not respond to requests for comment.
Menomonie leaders held a data center rezoning meeting April 9. Residents divided their demands among half of the dozen-plus speakers. The demands, from
"It's perfectly fair to say, 'This land use requires its own zone,'" said Blaine Halverson, a leader of the local opposition. "Our goal is protection. … It's more legally feasible if you're regulating based on size rather than just saying, 'No, we don't want them.'"
In Ohio, state Sen. Kent Smith, D-Euclid, introduced
"I included the rollback of the massive Ohio data center tax break in prior legislation," Smith said. "We now have introduced it as a standalone bill… I'm not sure if it's going to get a hearing anytime soon."
Ohio lawmakers tried to end the tax incentive through the FY2026-27 budget that passed in June, but Gov. Mike DeWine vetoed that provision. In March, Republican leaders said they
"That would be the easiest way to do it," Smith said. "I'm not anti data center, per se, but I think the tax break is ridiculous.
"We've got a skilled workforce here," he added. "We could absolutely get rid of the tax break, and those construction jobs would continue to happen."
Ohio's ballot measure would ban data centers with an aggregate monthly demand or peak load over 25 megawatts per month.
A petition is now circulating to get it on the ballot, said Austin Baurichter, a member of Ohio Residents for Responsible Development, the group advancing the measure. "What matters is to have the people make the choice," he said.
If legislators are trying to act on tax incentives, but are "stuck in gridlock for various reasons, we're going to obviously continue with the petition," Baurichter said. "While nothing is happening, data centers are being aggressively developed."
This would not be the first time the region "put all its eggs in the corporate developer basket, and more or less trusted these promises of, we'll take care of you and your communities," Baurichter added. The last time communities heard similar promises "was with the coal mines," he said.
In Oregon, Ohio, population 19,726, Capacity LLC is developing a $2 billion, 500 MW data center on 168 acres, according to
At a November town hall, residents questioned Capacity's managing director of site selection, Will Turner, and then-Mayor Mike Seferian. Steven Salander
"Usually the city gets their money from payroll income tax," Seferian told the town hall. "But being that this is a mega project, the state of Ohio allows us to do things called payments in lieu of taxes, which does create a big revenue stream for the city."
A report from the
Turner told locals there's a "cold hard fact we all need to face: Our power grid is old. It is in need of updating… everything in it. Regardless of the data center demand."
Residents objected to the data center at the March 16, March 9, Feb. 23, Feb. 16 and Feb. 2 city council meetings, according to meeting minutes.
"There's a very vocal opposition to it," Salander told The Bond Buyer. "The biggest thing for us, in my opinion, is that we are a very environmental city." He said Oregon will host a major birding event in the next month as rare migratory birds pass through.
As for PILOTs, Salander said payments would be split between the city and the schools, but terms have yet to be negotiated. The city is aiming for a 30-year agreement, he said.
"We have not been told" who the ultimate tenant of the data center would be, he said.
