From New York to Texas, states should respect local control on data centers

There are already nearly 4,600 data centers in the United States and thousands more in the works.

In 2025, companies spent almost $400 billion on U.S.-based data centers, with spending trending even higher this year.

From New York to Texas, the backlash is growing.

"Leading the nation," read a sign on the podium as New York Democrat Gov.

Kathy Hochul introduced a statewide moratorium on hyperscale data centers.

Texas followed on Aug.

3, when Republican Gov.

Greg Abbott announced a pause on new data center grid connections until state agencies can audit the projects.

At least 14 other states are considering similar actions, including Maryland, Michigan, Minnesota, Wisconsin and even Virginia, whose northern suburbs are the data center capital of the world.

These misguided efforts seek to protect residents from data centers by ensuring they miss out on the benefits.

Communities that excluded canals and railroads in the 19th century often found themselves bypassed by new economic activity.

TEXAS GOV.

GREG ABBOTT EFFECTIVELY PAUSES NEW DATA CENTER PROJECTS PENDING STATEWIDE GRID AUDIT States that make it hard to build artificial intelligence (AI) infrastructure risk a similar mistake.

Compute can be accessed remotely, but the communities that permit the necessary physical infrastructure – like data centers – will still attract capital, expand their tax base and create jobs and other opportunities that other areas may miss out on.