(The Center Square) – The executive vice president of a coalition advocating for data center development says reversing course on incentives in Illinois could have “detrimental” economic consequences.
Last week, Gov. J.B. Pritzker told the Aspen Climate Summit he reversed course on offering tax exemptions to data centers to send a message that developers need to address concerns.
“I felt like we needed to not be contributing to that problem,” Pritzker said. “And instead, let’s say, especially because these data center companies and the large tech companies have the resources to bring energy with them.”
In 2019, Pritzker, along with a bipartisan group of state legislators, hailed policies providing tax incentives to develop data centers in Illinois. Earlier this year, Pritzker announced he was putting a hold on tax exemptions for data centers.
“How about if we say ‘we’re not going to incentivize you, we’re going to tell you that you’ve got to bring energy with you,’” Pritzker said last week. “If you’re going to come and you’ve got to have closed loop systems that make sure that you’re not contaminating our water or taking too much of our water and costing people in your utility bills, water and electricity.”
Data Centers Coalition Executive Vice President Dan Diorio told The Center Square that’s what developers are doing. He worries such a move will backfire.
“That exemption provides a valuable incentive to ensure that communities are served by the most up to date equipment and the most energy efficient equipment,” Diorio told The States by The Center Square. “I worry that this is going to ultimately have and be a long term detriment, to fostering economic development, in the state of Illinois and elsewhere.”
Restricting tax credits in Illinois adds to other hurdles going up across the country, something Diorio said could discourage investment for data center development in the U.S.
“I think as we look at our lives today, it is absolutely crucial that we have the ability to store Americans’ data here at home safely and securely,” Diorio said. “This is a national security imperative.”
Pritzker’s major party opponent in November’s election, former state Sen. Darren Baily, said in a social media post Pritzker handed out subsidies, “then changed his tune after Illinois families got stuck with higher electric bills.”
Independent candidate Collin Corbett is also on the November ballot. His campaign website says he’d work to reign in “unchecked data center growth.”
