An eleventh-hour effort before summer recess to send data center regulations to Gov. Mike DeWine died late Wednesday night.
The last-minute legislation Ohio lawmakers were considering would have created an electric rate class for the state’s data centers, cut local tax abatements of facilities at 50%, and regulated water usage and discharges by them, among other measures.
But objections by House members to extend a sales and use tax break ultimately killed negotiations. The amended version of House Bill 646 is unlikely to see any substantive action before November.
What comes next?
Sen. Brian Chavez (R-Marietta) said the legislature is limited in how much it can do because of multi-decade commitments.
“That was established in the Kasich administration,” Chavez told reporters. “We can’t go back, that cake is baked and half eaten. There may be some things that we can do, but that’s not anything that we can do right now.”
Most existing contracts between the Ohio Department of Development and existing data centers stretch years, and sometimes decades, into the future.
Amazon, Meta and Google are benefitting for any facility they build statewide through at least 2055, 2056 and 2058, according to Department of Development contract documents obtained by the Statehouse News Bureau.
Director Lydia Mihalik suggested Ohio could try and renegotiate.
“But candidly, they’re going to make those decisions based on the best movement forward for their business,” Mihalik told the Joint Data Center Committee on Thursday morning.
The state underestimated the cost of the sales tax break in 2025 by more than $1.4 billion. Rep. Chris Glassburn (D-North Olmsted) said the lack of insight into the real revenue lost has left him “angry” and “exhausted.”
“We need to renegotiate those agreements,” Glassburn told reporters. “I also think if ... we don’t even know what we’re doing, we’re going to look like idiots, and right now, we look like idiots.”
The Ohio House could reconvene June 24, but Chavez said Thursday the Senate won’t be.
