A bipartisan bill introduced in the Michigan Legislature aims to repeal the state’s data center tax incentive laws. These laws, approved in late 2024, have attracted over a dozen data center proposals.
Public opposition to data centers is escalating. A Michiganders Against Data Centers protest is planned at the state capital, demanding a moratorium on these projects. A recent state hearing on one center drew over 800 attendees.
The centers are controversial and have pitted residents against tech companies and political supporters. Concerns include potential increases in energy and water bills, environmental pollution, and impacts on rural communities.
The repeal is timely as data centers, requiring significant energy, could derail Michigan’s clean energy plans.
The repeal bill was introduced by Rep. Dylan Wegela, a Democratic Socialist, and Rep. Jim DeSana, a Republican in the Freedom Caucus. Wegela criticized subsidizing wealthy corporations, stating: “If they’re coming here, they should be taxed like everyone else.”
Current laws offer tax exemptions to companies like Google and Microsoft, diverting funds from Michigan’s school aid. Eligible data centers have avoided $13 million in taxes. This figure is expected to rise with more proposals.
Supporters argue data centers support the AI boom and create jobs, but these are often limited and low-paying. DeSana described the incentives as “corporate welfare,” questioning why rural areas are targeted over industrial sites.
Democratic state Sen. Kevin Hertel, co-author of the original bills, has not commented on the repeal. The laws have divided Michigan Democrats, with disagreements on ratepayer protections and renewable energy requirements.
Kalkaska, a town in the northwest Lower Peninsula, successfully opposed a center proposal. Mitch Distin, a local ecologist, supports the repeal, linking incentives to frequent new proposals and environmental concerns.
Despite local opposition, some projects proceed. In Washtenaw County, four centers are planned, including a controversial site in Saline Township backed by both state and federal administrations.
Jeff Rechten, a nearby resident, supports the repeal, noting AI companies are financially strong and don’t require government incentives. He believes Michigan’s infrastructure naturally attracts these companies.
The data centers threaten Michigan’s climate goals, potentially triggering an “offramp” in energy laws due to their high energy demands. DTE Energy and Consumers Energy are considering new gas plants to meet this demand, raising concerns about environmental impacts.
Few politicians have criticized big tech involvement. Rep. Wegela stated both parties are influenced by tech companies, urging the public to oppose widespread center construction.
Original Story at insideclimatenews.org