data centers
Ohio is a “top 5” state for its number of data centers, which currently number around 200. But that’s a title some in Ohio don’t embrace. In Ohio’s agricultural and rural communities, some citizens appreciate the technology and economic activity data centers bring while others fear loss of farmland, intensive water use, sales tax exemptions, and impacts on electric infrastructure and prices. Here’s a summary of recent developments that illustrate the challenges and discord Ohio faces as we determine how to deal with data centers.
- Ballot initiative for a constitutional amendment on data centers moves forward
Ohio Residents for Responsible Development wants Ohio citizens to determine the fate of data center development in the state. The group is petitioning for a constitutional amendment on data centers that would go before Ohio voters on the November ballot. The proposed constitutional amendment would prohibit the construction of any data center with a peak monthly load of more than 25 megawatts.
The Ohio Ballot Board on April 2, 2026 authorized the group to begin collecting the signatures for the ballot initiative. The Ohio Ballot Board approval and an earlier certification on March 16, 2026 by Ohio’s Secretary of State indicate that the group has satisfied the legal requirements for the petition and can begin the signature-gathering phase of the petition process.
The group behind the initiative is a grassroots organization of citizens whose goal is responsible growth that protects Ohio communities, resources, and local voices. The group now has until July 1 to collect about 413,000 valid signatures from at least half of Ohio’s counties on the petition. Verification of the signatures collected by the Secretary of State will then determine whether the measure will be on the November ballot. Read the “Prohibition of Construction of a Data Center” petition language on the Ohio Attorney General’s website, and learn more about ballot measures on the Secretary of State’s website.
- AEP data center tariff goes before Ohio Supreme Court
The parties have filed their briefs with the Ohio Supreme Court in a challenge to an unprecedented data center tariff by AEP. The Public Utilities Commission of Ohio (PUCO) approved the statewide data center tariff last July. Backed by AEP, the Ohio Consumers Counsel, the Ohio Energy Group, Ohio Partners for Affordable Energy, and Walmart the tariff aims to prevent the possibility that residential electricity customers will bear the costs of data center development by requiring data centers with a load of 25 MW or more to pay a minimum of 85% of their committed load over a 12-year contract. The approved tariff also requires AEP to end the moratorium it had placed on connecting new data centers. The Ohio Manufacturers’ Association Energy Group (OMAEG) appealed the PUCO tariff approval, arguing that the tariff is discriminatory. OMAEG had backed an alternative narrower proposal that would have applied to any electric service agreement for a single location with a load in excess of 50 MW if AEP could prove that the load would create transmission capacity constraints. All parties filed their briefs in the case by the March 24, 2026 briefing deadline, and we now await a date for the oral arguments before the Court. Read the briefs and follow the case on the Ohio Supreme Court’s website.
- Ohio House passes Data Center Study Commission bill
We’ve reported previously on Ohio House Bill 646, which proposes establishing a commission to study the data center development issue in Ohio. The Ohio House of Representatives passed a revised version of the bill on March 18, 2026. The bill would have the Governor, Speaker of the House, and President of the Senate appoint a Data Center Study Commission to examine data center issues and submit a report of findings and any legislative recommendations to the Governor and Ohio General Assembly within six months. The report must also contain suggested best practices and considerations for local decision-making bodies dealing with data center development.
The thirteen-member Commission must include persons knowledgeable in data center operations, agriculture, county and township government, rural electric cooperatives, water and environment impacts, municipalities, public utilities and economic development and tax incentives. The Commission must hold at least four public hearings and examine the following topics related to data centers:
- Environmental impact;
- Effect on the electrical grid, including on behind the meter electric supply and on
- consumer utility rates;
- Water usage, wastewater discharge, and impact on the local water supply;
- Noise pollution;
- Light pollution;
- Impact on the local economy;
- Impact on farmland;
- Value to national security and the development of artificial intelligence;
- Reports of foreign propaganda intended to create opposition to data centers;
- Any other relevant topics determined by the Commission.
The bill is now before the Ohio Senate and was referred to the Senate’s Financial Institutions, Insurance and Technology Committee on March 25.
- Other data center bills linger in the General Assembly
Several additional bills addressing concerns with data center development don’t appear to be moving forward quickly.
H.B. 706 focuses on the infrastructure impacts of data centers and aims to “ensure costs of new infrastructure and grid upgrades needed to serve these facilities are not shifted onto existing Ohio ratepayers.” The bill would require long-term service agreements of at least 12 years with electric utilities for data center customers, require the Public Utilities Commission to create standards for interconnection practices, load study deposits, and milestone requirements. It would also prohibit utilities from recovering data center costs from other customer classes, set minimum gilling standards, and require financial assurance prior to facility construction. The bill received its first hearing before the committee on March 4.
A second bill, H.B. 695, doesn’t address data centers directly but instead targets elected local officials who could have knowledge of such developments. The bill, sponsored by Rep. Adam Bird (R- New Richmond) and Rep. Brian Stewart (R-Ashville) would prohibit county commissioners, township trustees, and village mayors and council members from knowingly entering into nondisclosure agreements that prohibit “disclosing, discussing, describing, or commenting on” matters related to official duties, a repeated complaint of citizens. The bill would make the agreements void and unenforceable and impose civil fines of up to $1,000 on officials who violate the law.” A first hearing before the House Local Government Committee took place on March 11, 2026.
Most recently, Senators Kent Smith (D-Euclid) and Louis Blessing (R-Colerain Township) introduced a proposal to limit sales tax exemptions for data centers beginning on October 1, 2027. The pair introduced S.B. 374 on March 11, but the bill has not received any hearings since its referral to the Senate Finance Committee on March 25, 2026. The bill fills a gap left when Ohio legislators declined to attempt an override of Governor DeWine’s veto of a law passed by the legislature last June that would have ended the sales tax exemptions.
Also referred to committee on March 25, 2026 is H.B. 784, sponsored by Rep. Christine Cockley (D-Columbus) and Rep. Crystal Lett (D-Columbus), which would require any data center that withdraws waters of the state to submit monthly and annual data center water consumption reports to the Division of Water Resources. The bill also contains non-disclosure prohibitions similar to H.B. 695. A third bill also referred to committee on March 25, 2026 is S.B. 381. Rep. Casey Weinstein (D-Hudson) introduced the proposal, which requires interconnection approval from the Public Utilities Commission of Ohio prior to connecting a data center with a monthly maximum demand of more than 25,000 kilowatt hours. The bill is now before the Senate Public Utilities Committee.
Stay tuned to the Ohio Agricultural Law Blog for continued legal information on data center development in Ohio. Also see an analysis of the fiscal costs of data centers from Dr. Gabriel Lade, OSU’s Swank Chair in Rural Urban Policy, though this link to Substack.
As we move into March, we thought it’d be a good time to look back at what committees in both chambers of the Ohio General Assembly got up to in February. Committees in both the House and Senate are considering bills to regulate carbon capture, change the levy process, study the effects of data centers, and more. Here is an update on the bills we are following.
H.B. 170, Carbon Capture—On Tuesday, February 17, the Ohio Senate Energy Committee held its first hearing on House Bill 170, which would give the Ohio Department of Natural Resources (ODNR) the authority to regulate carbon sequestration in the state. We previously wrote about H.B. 170, sponsored by Representatives Robb Blasdel (R-Columbiana) and Peterson (R-Sabina) when it was passed by the Ohio House in October 2025. For a more detailed discussion of the bill, please see our previous blog post, available here.
The Senate Energy Committee heard testimony from Representative Peterson, along with five proponents of H.B. 170. Most of the testimony centered on the idea of the state gaining “primacy,” or in other words, seeking approval from the U.S. EPA for the state to regulate Class VI injection wells instead of the federal government through the U.S. EPA. Basically, sponsors and proponents argued that if the state can regulate Class VI injection wells within Ohio, that will result in a faster permitting process for carbon sequestration projects within the state. Representative Peterson pointed out that by gaining “primacy,” the regulatory decisions would be more connected to the Ohio communities where the wells are located.
Several proponents of the bill also testified, including the American Petroleum Institute, the Ohio Oil & Gas Association, Vault 44.01, Tenaska, and Hocking Hills Energy and Well Service, LLC. Proponents testified that states with primacy over Class VI injection wells were usually able to approve a project within 9-12 months, whereas the federal EPA process could take around two years. Furthermore, not obtaining primacy could mean that Ohio might lose projects and jobs to other states who do have primacy. Faster state approval could create jobs and economic benefits in Ohio for projects that the proponent companies are considering. Some of those projects would be centered around sequestering carbon from ethanol facilities located in Ohio. At present, North Dakota, Wyoming, Louisiana, West Virginia, Arizona, and Texas have obtained primacy to regulate Class VI injection wells. Indiana, Pennsylvania, and Michigan are currently considering legislation to gain primacy. You can read H.B. 170 here.
H.B. 420, Property Tax—House Bill 420 had its first hearing in the House Ways & Means Committee on February 11. Sponsored by Representatives Click (R-Vickery) and Willis (R-Springfield), H.B. 420 would prohibit new continuous levies from being placed on ballots, require continuous levies currently on the books to be converted to fixed-term or renewed levies prior to 2030, and prohibit continuous levies in the state after 2030 unless such levies are specifically authorized by voters. The House Ways & Means Committee heard sponsor testimony from Representatives Click and Willis. Representative Click argued that “each generation deserves the right” to approve or disapprove of a levy tax, and that continuous levies prohibit this right by imposing taxes upon people who didn’t originally vote for them. Questions from members of the committee clarified that if passed, the longest levies would last 10 years, however, levies could also exceed that timeframe if they are fixed to loans for long-term investments made by a school, locality, etc. Representative Rogers (D-Toledo) expressed concerns that if passed, the bill could lead to an upheaval in local funding. You can read H.B. 420 here.
House bill 420 is part of what Representative Click has dubbed a “Taxpayers Freedom Trilogy” bill package that also includes House Bills 421 and 422. H.B. 421 would allow ballot measures to reduce inside millage, and H.B. 422 would establish higher thresholds for levy requests over 1 mill (60%) and 2 mills (66%). Neither of the second or third parts of the “trilogy” have received committee hearings yet. Of note, a second hearing on H.B. 420 was scratched from the February 18 House Ways & Means Committee agenda, and House Speaker Huffman has indicated that it is unlikely that these property tax proposals will pass the House before the summer legislative recess. You can find H.B. 421 here and H.B. 422 here.
H.B. 646, Create the Data Center Study Commission—House Bill 646 had its second hearing in the House Technology & Innovation Committee on February 24. We covered the details of H.B. 646, sponsored by Representatives Click (R-Vickery) and Deeter (R-Norwalk) in an earlier blog post, available here. The hearing drew interested party testimony from numerous groups and individuals, including the Ohio Chamber of Commerce and the Ohio Farm Bureau. The Ohio Chamber of Commerce supported the creation of a Data Center Study Commission but implored the committee to include representation from the tech industry on the Commission, noting that data centers would bring with them jobs, increased GDP, and increased local revenues. Ohio Farm Bureau supported the creation of a Commission to study the impacts of data centers, including the impacts on agricultural land and resources long term, water use, water quality, and other potential environmental impacts. Ohio Farm Bureau also cited the need for a robust regulatory framework for data centers and long-term land use planning, worrying that without such planning, agriculture in the state of Ohio will suffer from loss of land to development and other problems. Individual citizens testified that they would like H.B. 646 to include a moratorium on building data centers while the study takes place and noted that the Commission should consider what happens to data center property after it is no longer in use. You can find H.B. 646 here.
S.B. 285, Recoupment Charges—The Senate Ways & Means Committee heard proponent testimony for Senate Bill 285 during its February 10 meeting. S.B. 285, sponsored by Senator Schaffer (R-Lancaster), would make it explicit that agricultural land converted to certain conservation uses would be exempt from a CAUV recoupment penalty if it was previously used for agricultural purposes. Specifically, land would be exempted if it is given to the Ohio Department of Natural Resources (ODNR) to use as a nature preserve, if it is owned or held by an organization with the purposes of natural resources protection or water quality improvement. The president of the Stream and Wetlands Foundation, based in Lancaster, Ohio, explained during his testimony that the bill would basically be a small technical clarification to previous legislation passed in 2022. Since 2022, some county governments have interpreted current law as requiring CAUV recoupment charges to be paid for land used to protect natural resources, while other counties have not. S.B. 285 would clear up this confusion and affirm that CAUV does not apply to exempted land used for conservation purposes. S.B. 285 is available here.
S.B. 361, Eminent Domain—During its meeting on February 17, the Senate General Government Committee heard sponsor testimony from Senator Schaffer (R-Lancaster) on Senate Bill 361. The bill would prohibit the taking of land by eminent domain for use as a trail for hiking, bicycling, horseback riding, ski touring, canoeing, or other nonmotorized forms of travel. During his testimony, Senator Schaffer gave an example of a property owner in his district whose land would be cut in half by a recreational trail, and asserted that local government shouldn’t be able to take land from a property owner just for recreational purposes. Senator DeMora (D-Columbus) asked for clarification about whether pathways for pedestrian and bike safety along roadways would fall under this prohibition. Senator Schaffer responded that that is not the intent of the bill, and that he would be willing to work with the Committee on language if necessary. S.B. 361 is available here.
Tags: Ohio legislation, property tax, cauv, carbon capture and storage, eminent domain, data centers, land use
Comments: 0
Data centers are Ohio’s newest land use controversy. With concerns ranging from water use to electricity prices to loss of farmland, the rapid onset of data center development has generated many questions and conflicts across the state. In response, members of the Ohio legislature have introduced several bills on data center development, and we should see a few more bills introduced soon. Here’s a review of recently introduced legislation.
Data Center Study Commission. The first bill is H.B. 646, which would require formation of a Data Center Study Commission to study data center impacts in Ohio. We explained H.B. 646 in an earlier post. The bill had its first hearing before the House Technology and Innovation Committee on February 17, where the sponsors testified that data center development “introduces complex and immediate challenges” and that “it is both prudent and necessary that we, as policymakers, take the time to fully understand its implications and adopt an informed, integrated approach…” The bill is already scheduled for a second hearing on February 24, an indication of continued interest in moving the bill forward.
Prohibitions on nondisclosure agreements. A second bill, H.B. 695, doesn’t address data centers directly but instead targets elected local officials who could have knowledge of such developments. The bill would prohibit county commissioners, township trustees, and village mayors and council members from knowingly entering into nondisclosure agreements that prohibit “disclosing, discussing, describing, or commenting on” matters related to official duties. The bill would make the agreements void and unenforceable and impose civil fines of up to $1,000 on officials who violate the law. Rep. Brian Stewart (R-Ashville), co-sponsor of the bill along with Rep. Adam Bird (R-New Richmond), explains that “in 11 years as a local elected official - dealing with scores of major development projects - I never signed an NDA, and I never would. Secrecy breeds distrust amongst the taxpayers, which is detrimental to economic development efforts.” The bill was referred to the House Local Government Committee on February 18, 2026.
Requirements for data center customers. A bi-partisan bill introduced on February 17, 2026, by Rep. Tristan Rader (D-Lakewood) and Rep. David Thomas (R-Jefferson) aims to “ensure costs of new infrastructure and grid upgrades needed to serve these facilities are not shifted onto existing Ohio ratepayers.” H.B. 706 would require long-term service agreements of at least 12 years with electric utilities for data center customers, require the Public Utilities Commission to create standards for interconnection practices, load study deposits, and milestone requirements. It would also prohibit utilities from recovering data center costs from other customer classes, set minimum gilling standards, and require financial assurance prior to facility construction.
Democrats in the legislature suggest that several additional data center bills are under development. Proposals we still might see include granting local governments the authority to reject proposed data center projects, eliminating the sales tax exemption for data centers, requiring facilities to cover costs for additional power generation or transmission, and establishing water consumption limits, reporting, and investments in water infrastructure. Keep an eye on the Ohio Ag Law Blog for continued updates on data center legislation in Ohio.
We’ve been fielding many questions and concerns about the development of data centers and its potential impacts on agriculture and communities across Ohio. Newly proposed legislation indicates that lawmakers are hearing the same. House Bill 646, introduced on January 15 in the House of Representatives by Rep. Gary Click (R-Vickery) and Rep. Kellie Deeter (R-Norwalk), would establish a Data Center Study Commission to examine data center development in Ohio. Here are the initial details of the proposal.
Sponsor Intentions
Both sponsors state that although data centers offer economic development, constituents have raised concerns about where that development occurs and potential impacts on energy prices, water supply and farmland, and that a growing number of local communities have taken actions to ban data centers.
"We have heard the concerns of our communities and taken time to speak with those in industry. We feel that this is the best approach to ensure that every voice is heard," stated Rep. Click.
Rep. Deeters followed by stating that “[i]n my rural district of 33 townships, residents are raising serious concerns about greenfield development and the loss of productive farmland. This bill creates a Data Center Study Commission so Ohio can take a thoughtful approach, possibly even prioritizing redevelopment of brownfields and existing industrial sites before expanding into rural green space. The proliferation of data centers is necessary and inevitable, but the growth should be smart, balanced, and respectful of local communities.”
Emergency Declaration
Its sponsors declare the bill to be an emergency measure that would go into immediate effect upon passage in the Ohio legislature. The bill is “necessary for the immediate preservation of the public peace, health, and safety,” state the sponsors, who provide several reasons for the emergency declaration:
- Data centers are proliferating rapidly in the absence of a specific regulatory structure, or historical precedent, which is generating serious concerns among the citizens of this state and creating an unstable environment for local decision making.
- Verifiable information is crucial to such citizens when facing new development within their communities and local political subdivisions tasked with approving such development, as well as investors who wish to site data centers throughout Ohio.
- Verifiable information benefits all concerned parties and is urgently needed due to the rapid development of this emerging technology and the lack of general knowledge concerning data centers in Ohio.
Data Center Commission Members
Under the bill, the Data Center Commission (Commission) would consist of 13 members, to be appointed within 30 days of the bill’s effective date as follows:
- Three members appointed by the Governor.
- Three members appointed by the Speaker of the House of Representatives.
- Two members appointed by the Minority Leader of the House of Representatives.
- Three members appointed by the President of the Senate.
- Two members appointed by the Minority Leader of the Senate.
Charge to the Commission
The bill defines a “data center” as a “physical facility equipped with, or connected to, one or more computers that is used for processing or transmitting data” and requires the Commission to examine each of the following in regard to data centers:
- Environmental impact;
- Effect on the electrical grid, including on behind the meter electric supply and on consumer utility rates;
- Water usage and impact on local water supply;
- Noise pollution;
- Light pollution;
- Impact on the local economy;
- Impact on farmland;
- Value to national security and the development of artificial intelligence;
- Reports of foreign propaganda intended to create opposition to data centers;
- Any other relevant topics determined by the Commission.
Meetings of the Commission
The proposal requires the Commission to hold at least four public meetings. Two of the meetings must be to hear public testimony on the topics above, and two of the meetings must be to hear invited expert testimony on those topics.
Commission Report
The Commission must work quickly, as the proposal orders the Commission to submit a report of its findings and any legislative recommendations to the Governor and the Ohio legislature not more than six months after the bill’s effective date. After issuing its report, the Commission would terminate.
Follow H.B. 646 on the Ohio General Assembly website.
