What to do about data centers? New bills offer some solutions

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.