Brookfield’s Compass Datacenters announced last month that it was abandoning 800-plus acres of planned data-center campus in Prince William County. It was the lynchpin of a more than 2,100-acre data center campus that was planned.
A debate among Virginia politicians about the size of the tax breaks the data-center industry would receive “cemented executives’ resolve to walk away.”
Compass was a casualty of a broader political shift. A recent Washington Post poll found massive opposition among Virginians to data center expansion. This sentiment found a legislative champion in Richmond.
Virginia Senate Finance Chair Louise Lucas has proposed eliminating the state’s sales and use tax exemption for data centers entirely. It’s a policy reversal that would undo the very agreements that drew billions in investment to Virginia in the first place.
The House wants to preserve the exemption with added environmental standards. Gov. Spanberger, to her credit, is trying to make a deal work.
As co-chair of the AI Infrastructure Coalition, I know the backlash is real. But the backlash is built on myths.
First, jobs.
Data centers now employ more than 603,000 Americans — roughly 1.5 times more than all 15 of our domestic automakers combined. In Virginia alone, the industry contributes an estimated 113,000 jobs annually, according to a PwC study.
IBEW organizer Don Slaiman described the industry as creating “six-figure blue-collar jobs right in the center of Northern Virginia. That is unheard of.” In 2024, 10% of all commercial and industrial construction jobs in Virginia were tied directly to data centers.
Next, energy.
Data centers represent just 4% of America’s electricity demand — less than new space cooling systems, new heat pumps and new factories, according to the International Energy Agency. Virginia saw electricity bills rise just 3% last year. Maine — which has just a few data centers — saw a 36% increase.
Recently, the major AI hyperscalers signed a pledge to “pay their fair share” of energy costs. And they’re putting it in writing: a DOE-commissioned Lawrence Berkeley National Laboratory analysis documents how data center contracts now increasingly include binding financial guarantees — minimum revenue commitments, upfront infrastructure payments and long-term service terms — that ensure these companies bear the full cost of the grid built to serve them. Americans won’t be footing the bill for datacenters.
Third, water.
Thanks to advancements in technology, new facilities either recycle water through closed-loop cooling systems, using less water than traditional office buildings, or they use no water at all.
The truth is that data centers improve everyday Americans’ lives.
In Loudoun County, Virginia, for example, data centers cover 3% of the land and generate nearly 45% of the county’s tax revenue. The county has cut homeowner property tax rates by 40% over the last decade. Statewide, data centers pay $26 in taxes and fees for every dollar of support they receive. Meanwhile, manufacturing plants pay $4.
The sales tax exemption Virginia politicians want to eliminate is an investment in their state.
Research has shown that AI helps detect breast cancer. A study in the medical journal The Lancet found that AI helped radiologists detect 29% more cancer.
Waymo autonomous vehicles have now completed 170 million rider-only miles, with 92% fewer serious-injury crashes than average human drivers.
AI is making our lives better every day. Virginians benefit from a continued investment in our future, both at home and in the community.
Kyrsten Sinema is a former U.S. Senator from Arizona (I-AZ) and co-chair of the AI Infrastructure Coalition.
