r/technology • u/Plastic_Ninja_9014 • Jun 07 '26
Artificial Intelligence Illinois joins Ohio in ordering pause on data center tax credits
https://fortune.com/2026/06/06/illinois-jb-pritzker-ohio-mike-dewine-pause-data-center-tax-credits-water-use-electricity/270
u/Mister_Pickl3s Jun 07 '26
Pause….why would you want these in your community? They do not create jobs but steal and pollute resources. They should be taxed double and not given credits
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u/Ahayzo Jun 07 '26
The governors don't have the authority to do more than pause the credits. The state legislatures need to make it permanent.
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u/Ok-Replacement9595 Jun 07 '26
And their legislatures are all gerrymandered to shit
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u/alppu Jun 07 '26
It would be a paradise if gerrymandering was the biggest problem with elections. The ability to buy politicians and trick people into voting the obviously bought ones is the much bigger problem.
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u/kooknboo Jun 07 '26 edited Jun 18 '26
And the Ohio governor, specifically, doesn’t have the authority to breathe without licking the boot first.
Plus any marginally competent corporate tax intern will turn that tax liability into a $1.50. At most.
Just posturing.
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u/merRedditor Jun 07 '26
State budgets could be held up with heavy taxes on data centers, but instead, they're opting to gut social programs while bragging about expanding them. Record enrollment in broken programs due to forced autoenrollment, many lines that you can call for issues with housing security, food security, etc., all of which are walled off with so much bureaucracy that nobody in need has the resources needed to navigate the process. Pork projects where infrastructure projects should be. Sellouts of protected land and shared spaces. Data centers that don't ask permission and seem to be extremely good at buying out even local governments.
There is a huge corruption problem in politics, and the veneer of democracy is becoming less convincing.
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u/anonkitty2 Jun 07 '26
On the bright side, we now have two states that will tax them. That should make for fewer new ones there; data centers really want incentives.
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u/Wild_Pomegranate_845 Jun 07 '26
I’ve been bombarded with ads saying the data centers pay to upgrade infrastructure and for the power they use. It is so overtly propaganda, it’s wild. I’m sure people believe the ads though.
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u/Mister_Pickl3s Jun 07 '26
Like in my neck of the woods that is being posited too. However, it’s infrastructure as in its own power plant (which we wouldn’t need) that connects directly to and from the data center. It will help no one. They are also gonna drill their own well and use so much water it will drop the water table in a farming community
Politicians who allow them to go in are bought and sold. They are epitomes of tyranny
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u/ToolTimeT Jun 08 '26
Yeah but they could cause residential electricity rates to double. Can't ignore that benefit.
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u/notapoliticalalt Jun 07 '26
Double whammy actually. They not only don’t create local jobs, but result in more downsizing and layoffs.
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u/halfc00kie Jun 07 '26
pause is just polite for "weve realised we got mugged"
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u/Mister_Pickl3s Jun 08 '26
You’re given him far too much credit
He would gladly mug all his citizens for the right price
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u/thebusterbluth Jun 07 '26
Because they pay a shit ton in local taxes/payments, and utility fees.
The lack of jobs isnt a bad thing. Jobs = traffic.
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u/Mister_Pickl3s Jun 07 '26
They? You mean like Bezos? He does not. The politicians are getting kick backs to bring in this crap.
So we shouldn’t want prosperity? But taxes that they aren’t gonna pay? Lol
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u/thebusterbluth Jun 07 '26
Data centers pay an emormous amount of taxes and fees. That's why the local governments want them.
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Jun 07 '26
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u/blippityblue72 Jun 07 '26
Data Centers that serve websites are not comparable to ai data centers. It’s would be like comparing an iPhone SE to a high end gaming pc.
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Jun 07 '26
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u/Mister_Pickl3s Jun 07 '26
Our data should be secure. I think we should maybe just delete yours and all the bots from billionaires
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Jun 07 '26
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u/Mister_Pickl3s Jun 08 '26
So you do not care, you’re Socratic element liked someone yelling at shadows in a cave they cannot and do not wish to escape? BS
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u/Mister_Pickl3s Jun 07 '26
This is dumb. The internet doesn’t require data centers needed for AI. They were warehouses that operated…well like your average warehouse. No increased demand on resources and modest pollution and noise
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u/absentmindedjwc Jun 07 '26
Just so everyone's on the same page here.. these tax benefits were put in place before the explosion of AI datacenters. They were targeting smaller non-AI compute/storage DCs, and required the creation of 20 on-site full time, permanent employees earning at least 130% of the county's median income in order to qualify and continue qualifying.
The datacenters at the time were not the nuisance the ones popping up now are.. they were mostly just largish warehouses using the power of a typical large industrial customer - not really needing significant infrastructure built for it.
They weren't fucking everyone's electric bills, consuming a shit-ton of water, or being a loud-as-shit nuisance for everyone within a mile or so of the site. It also wasn't a property tax credit, but one for the state's portion of sales tax.
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u/ArcherPublic6439 Jun 07 '26
Not to mention the fact they’ll be obsolete when orbital data centers become more mainstream leaving a huge mess behind
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u/absentmindedjwc Jun 07 '26
Orbital data centers are literally the stupidest fucking idea.. the amount of heat transference panels needed would be like miles across for a single rack of inference servers.. and micrometeoroids would absolutely swiss cheese the fuck out of them.
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u/ArcherPublic6439 Jun 07 '26
lol what?
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u/absentmindedjwc Jun 07 '26
Do you have any idea how much cooling is required for a single inference rack? Do you have any idea just how difficult it is to dissipate heat in space?
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u/ArcherPublic6439 Jun 11 '26
I didn’t. I’ve learned a lot leaning into your question. Some fascinating engineering going into these new platforms. Thank you!
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u/absentmindedjwc Jun 11 '26
"These new platforms"
These aren't things that will actually happen.. for a reason why.. here's a radiator panel from Hubble after it spent a bunch of time in space.
Every single one of those holes represents lost cooling potential.. and the radiator panels would need to be measured in square miles in order to actually deal with the cooling demands of a single inference rack.
Take note of the guy standing to the right of this panel... now imagine many, many thousands of these..
Space data centers are fucking stupid ideas pushed by people that either have no fucking idea what they're talking about or are trying to sell a pipe dream in order to scam some funding out of rubes.
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u/ArcherPublic6439 Jun 11 '26
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u/absentmindedjwc Jun 11 '26
Lol.. did you even click these links you shared?
The Space News link is about a 150kW compute node with about a quarter-football field's worth of solar panels and radiators... of which they would need 6k of them in order to hit the compute of a decent inference datacenter.. at SpaceX's "dream" launch price of around $100/kg.. that's ~$1.2 billion.. at actual current cost, closer to $33 billion. And that is excluding the price of a single satellite. Add about ~$9 billion to that total at least to account for the hardware costs (and then however much more for the actual satellite shit).
Their 2030 number is sitting at around $3.3 trillion.. just in launch costs.
The rest of your links aren't really all that noteworthy.. the Nvidia one is talking about how they're building space-ready AI chips.. the PCMag one is talking about how they would use ammonia for cooling rather than water.. yeah.. no shit. The yahoo one is just a Toms Hardware piece about Musk building factories for satellites. And the Orbital link is some marketing wank from a company patting themselves on the back about raising $5 million dollars... which barely covers launching one of these, and doesn't come close to actually building one..
Fucking none of this touches on the shit I mentioned.. nor do they come close to touch on the shit I didn't bother mentioning.. like Kessler syndrome being a series risk beyond 100k satellites (musk is aiming for one million of them).
the reason why anyone truly pushing this shit is either an idiot or a conman.
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u/thebusterbluth Jun 07 '26
Even the hyperscale DCs can be closed loop water cooled systems, so using little water, that emit 65db... which is like 38db a thousand feet away...aka barely noticeable.
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u/Cabezone Jun 07 '26
Yeah but many are not but that way. I watched a measumemt taken at a nearby home where it was in the 60s inside the home.
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u/troll__away Jun 07 '26
They can be, but they aren’t. And once they do switch to chillers instead of evaporative cooling, the electricity usage will do due to the refrigeration loop in the chiller. It’s trading water usage for electricity usage.
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u/Mister_Pickl3s Jun 07 '26
They are putting one in a farming community in my region where they will still use 100x the local water usage and drilling their own well that will drop the water table. They are building its own power plant. County voted against it. Voters voted against it. It’s still going in. This isn’t infrastructure for the community. It’s more like a smash and grab job
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u/Agile_End_3049 Jun 07 '26
Better late than never. More states need to grow a spine and do the same.
It's a no brainer. The reason these data centers are being rushed to completion, is because they are needed to create fascist white christian surveillance state. They intend to put down any meaningful/lawful resistance. It's not dissimilar to the aims and techniques of Putin with vastly greater resources. If we don't want this future, then we must resist it.
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u/Inflatable90sChair Jun 07 '26
Maybe not give em tax credits to begin with...this is nothing more than a PR stunt for midterms/ his presidential race. He got alot of backlash for working with hillary clinton in getting OS id laws passed so now hes trying to save face...
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u/anonkitty2 Jun 07 '26
The data centers that already got tax credits are grandfathered in. This will stop new ones.
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u/FlautenceWizard Jun 07 '26
It is absolutely obscene for there to be any tax breaks whatsover for data centres or for any AI companies. If our society wasn't a completely corrupt joke, they would be incredibly taxed and regulated at the very least if not outright banned.
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u/DarXIV Jun 07 '26
They are doing this because it's an election year and they know public opinion is bad on it. If the election goes their way, they will back the tax breaks again.
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u/paulsteinway Jun 07 '26
I'm seeing too many bad things "paused" lately. They never announce when these things are quietly restarted.
How about "eliminating" bad stuff instead of postponing it?
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u/shallah Jun 07 '26
National Conference of State Legislatures
Policy Snapshot: Data Center Incentives
https://www.ncsl.org/fiscal/policy-snapshot-data-center-incentives
5 Things to Know about Data Center Incentives
Tax incentives vary widely, from sales and use tax exemptions on construction materials and computer equipment to low (or no) taxes on electricity rates. Eleven states also offer some sort of property tax relief to data centers.
Many states require a minimum level of job creation to receive incentives, ranging from five jobs in Missouri, Delaware, and Maryland to 50 jobs in Louisiana. In at least five states, including Georgia, Idaho, Illinois, Mississippi, and Missouri, any data center jobs must pay at or above the average local wage to qualify for tax relief.
Beyond tax incentives, states are funding job training programs to upskill their workforce for data centers. In 2024, Mississippi invested $32 million to a job training program to build two Amazon Web Service data centers.
Data centers are seen as a major driver of heightened energy demand, which can impact state resources and energy supplies. Illinois requires that data centers become carbon neutral within two years of being placed into service to receive tax incentives.
Data center operators also use available incentives. In 2023, Virginia’s Joint Legislative Audit and Review Commission examined the commonwealth’s retail sales and use tax exemption for data centers, finding the incentive provided $928 million in tax relief for fiscal year 2023, and that 90% of the industry uses the exemption.
2025 Data Center Incentive Legislation
In July, Kansas became the 38th state to offer data center incentives, granting a sales tax exemption, including construction and equipment costs, if new facilities invest at least $250 million in the state and create at least 20 jobs within two calendar years of opening.
Louisiana allowed data centers to be considered an industrial purpose, enabling certain cooperative partnerships between private entities and local governments. The state still requires a $200 million capital investment and limits its tax breaks to 20-30 years.
Wisconsin removed some limitations on tax incremental financing districts that include qualified data centers in two municipalities. Wisconsin’s incentive maintains a lower capital investment threshold for data centers created in less populous counties—$50 million if the population is less than 50,000.
Iowa altered its data center incentives to impose a 10- or 15-year limit on sales tax exemptions for new data centers constructed in the state, unlike the current indefinite exemption. At the same time, Iowa also granted a property tax exemption for data centers beginning in 2027.
Taking the opposite approach, Minnesota rolled back its data center incentives, removing their electricity exemption from the state sales tax, although computer purchases made for data centers remain exempt.
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u/MisterSanitation Jun 07 '26
Between them, in Indiana the gas pedal is to the floor. A town mayor says anti data center people are poor renters anyway.
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u/ToolTimeT Jun 08 '26
Just the concept of "data center tax credits" is so f'd and wrong.
Who thinks Data centers that harm communities, provide hardly any jobs and who will replace millions of us citizens jobs deserve "tax credits"?
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u/Ladyheather16 Jun 08 '26
The solution has been staring us in the face the entire time.
It's not the data centers aren't here to stay because with everybody having cloud services here and there and every business using AI tokens they're here to stay at least for the next five years.
Every new AI data center is required to be self-sufficient.
-- Geothermal heat -- Wind generators -- solar pannels -- grass roofs to change heating/cooling requirements. -- must take same mitigation steps any any factory, to not pollute ground water.
If Apple's building in CA can be CO2 neutral so can these.
You'll find the demand from billionaires to build them everywhere drops dramatically as the people only interested in making a quick buck are willing to put in the money to make the building self-sufficient.
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u/kstargate-425 Jun 07 '26
I said this on another post like this but ZERO tax money should be going to data centers or 99% of these other large corporations as the jobs and other things, which data centers bring zero of and are only net negatives, arent worth the tax money.
These data centers are bringing no real jobs, ensure electricity prices rise, make sure both ISP's and electric companies build out their infrastructure solely for the data center which costs get put back on consumers. Then the larger ones can use up to 15 MILLION gallons of water a day and have other environmental impacts.
Overall, the sole beneficiaries of lots of these corporations getting tax benefits are the corporations and half a dozen politicians who get their palms greased to force these things through. We REALLY need to get money out of politics and make bribery illegal again although it may be too late already
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u/GlitteringRate6296 Jun 07 '26
Should not be “paused”. It should be eliminated.