Virginia has turned against data centers.
The new state budget keeps the tax incentives for data centers in place but counters that with a new tax on the electricity they consume — the first such law in the nation.
Local governments are moving to enact restrictions. Front Royal’s town council recently voted down a zoning change that critics feared would open the way to data centers. Shenandoah County passed a measure to restrict them to industrial parks. Even data centers that are bound for industrial parks — such as the one coming to Botetourt County — have sparked controversy. Just the prospect of data centers in industrial parks in Amherst and Franklin counties has fired up opponents. That’s hardly a comprehensive list; there’s opposition in other places, too.
As a matter of government policy, the state government has now signaled a less welcoming attitude toward data centers — and many local governments are joining suit.
And yet … at the same time, that same state budget encourages the development and adoption of artificial intelligence, which requires data centers.
So which is it? Are we for them or are we against them?
The answer is not as simple as the question, but let’s first look at what the state is doing.
To begin with, the budget specifically directs certain state agencies to adopt artificial intelligence in their operations — “The Department of Medical Assistance Services shall seek opportunities to enhance call center operations through the use of artificial intelligence,” for instance, while the transportation commission is authorized to seek formal requests on how to pursue “the use of artificial intelligence in day-to-day activities.”
That may not be any different from what other states are doing, but let’s keep going.
The budget creates the Commonwealth Artificial Intelligence Institute — to be administered by the University of Virginia — and appropriates $500,000 for the fledgling institute to “coordinate with other universities and stakeholders to develop a statewide ecosystem in AI.”
The budget also appropriates $500,000 to George Mason University to scale up its “AI Innovation Nexus” in cooperation with other universities and the aforementioned Commonwealth Artificial Intelligence Institute. The International Federation of Engineering Education Societies hails George Mason as a leader in “shaping the future of artificial intelligence” by using it “to revolutionize education, research and operations” and “inspiring the next-generation workforce with advanced AI learning.”
The budget provides $500,000 for the MOVE Chamber — which calls itself “Virginia’s premier minority business chamber” — to set up an internship and apprentice program “for at least 1,000 students and recent graduates of the Virginia Community College System in Artificial Intelligence, Data Science, and Cybersecurity.”
Those amounts aren’t particularly large in the context of a two-year budget that’s north of $200 billion but they do represent formal policy commitments from the state. Meanwhile, state universities are jostling with each other to roll out programs on artificial intelligence. George Mason now has a Master of Science in AI. Virginia Tech has its Sanghani Center for Artificial Intelligence and Data Analytics. Both Tech (No. 38) and the University of Virginia (No. 48) are ranked in the top 50 nationally for artificial intelligence studies by EduRank. The website Master’s in AI singles out four schools for special mention for AI programs — Virginia Tech, UVa, George Mason and Old Dominion University — although it elevates Tech and George Mason above the rest: “These schools have tight relationships with big names such as Amazon, Google, Northrop Grumman, and Boeing. Virginia universities also act as feeders to federal & defense jobs, making this state our top pick for cyber AI.”
The SLM Corporation (commonly known as “Sallie Mae”) recently issued a report that ranked states based on which ones are doing the most to promote the training of a workforce for an artificial intelligence world. It ranked Virginia 10th (or ninth, if you take out the District of Columbia that ranked above us).
Taken together, it seems clear that Virginia wants to be a player somewhere in the AI world.
Therein lies the contradiction: Virginia wants to be an AI player but doesn’t seem to want the facilities that make AI possible.
That may not be an outright contradiction. I want my lights to come on, but I don’t want to live next to a power station.
If there is a contradiction, it’s on the workforce end of this equation. Virginia is actively training an AI workforce but is potentially sending some of these AI-related jobs away. Maybe not a large percentage — most people using AI won’t be working in data centers — but we are now starting to actively distance ourselves from those facilities. Can we have both — an AI workforce but not a lot of data centers? Or, to use the cliché, can we have our cake and eat it, too?
Potentially, yes. When Detroit was synonymous with car manufacturing, it got the benefit of high-wage manufacturing jobs but didn’t have to deal with the environmental issues associated with mining coal in Appalachia.
That was a different world, though — a physical one, not a virtual one. There were only so many places Detroit could find the coal to forge the steel that went into cars; both the upside and downside of a tech-based world is that these jobs can go almost anywhere.
If there’s an economic danger to Virginia’s new stance toward data centers — and none of us know yet — it will likely be in the realm of connections, influence and reputation. Will certain tech companies now look at Virginia and think we’re not worth a second look because our enthusiasm for data centers has cooled? Or will that matter at all? This is one of those things we likely won’t know for several years yet.
The larger contradiction is a political one — and is mostly concentrated in rural America. Here in Virginia, we’re now seeing data centers push out of Northern Virginia (or, perhaps, more accurately, being pushed out of Northern Virginia) and into other parts of the state. For now, that’s primarily around Richmond, but we do have the data centers coming to Appomattox County, Botetourt County, Pittsylvania County, Wythe County and who knows where else, with talk of others in Amherst County and Franklin County. These communities all have two things in common: They are rural counties that vote overwhelmingly Republican. The Trump administration has made AI development a priority, which inevitably means more data centers. Are Republicans going to feel any political heat over this? We don’t know yet, but these communities are opposing a key part of the Trump agenda, whether they realize it or not.
In politics, this is called “cross-pressure,” when people supporting one party find themselves at odds with part of that party’s agenda.
Republicans aren’t the only ones who may potentially feel these cross-pressures. It’s now in fashion for some Democrats to call for a moratorium on data center development. Beth Macy, the Democratic candidate for the U.S. House in the 6th District, has issued this call. So has Rep. Alexandria Ocasio-Cortez of New York, and Sen. Bernie Sanders of Vermont. These calls are very much in line with the party’s concern for environmental issues, but they also pit the party that sees itself as the champion of working people against a certain type of working people: the electricians and other trades who build data centers.
During the recent budget stalemate in Virginia over data centers, Don Slaiman, political coordinator of the International Brotherhood of Electrical Workers Local 26, issued this statement: “What is most striking is that in all the commentary from anti-data center proponents in both parties, there is zero importance or consideration given to the fact that data centers have created tens of thousands of high-paying union jobs for blue collar workers in construction, upgrading, retrofitting, and monitoring, as well as in the pre-fab factories that are opening around the state. This blatant indifference to Virginian’s careers and well being is a very sad testament to the political class’s indifference to the working class.”
The political cross-pressures go both ways: rural voters at odds with the Trump agenda and many Democrats at cross-purposes with labor unions. What a time to be alive!
Meanwhile, Virginia’s policies actively encourage a technology that we are simultaneously reluctant to accommodate.
