Michigan sits among 38 states handing out dedicated tax breaks for data centers, and a new report from Good Jobs First makes clear that taxpayers in most of those states can’t find out what those deals are actually costing them.
The watchdog organization, which tracks economic development subsidies nationwide, found that 14 states don’t disclose how much tax revenue they forfeit to data center incentives. That’s not a technicality. It means residents in Alabama, Arkansas, Idaho, Iowa, Indiana, Louisiana, Maryland, Missouri, Mississippi, North Carolina, North Dakota, Oklahoma, South Carolina, and Utah have no public accounting of what their legislatures are giving away in sales, use, or property tax breaks to attract massive server campuses. None of those states publish that information.
“No form of state spending is more out of control today than data center tax abatements,” said Greg LeRoy, executive director of Good Jobs First and the study’s primary author. “Hyperscale data centers are not only extractive of electricity, water, and land; they are also undermining public budgets.”
The states that do report what they’re spending tell a story that’s hard to wave off. Georgia, Virginia, and Texas each surrender more than $1 billion per year to data center incentives, as Michigan Advance reported. Not over a decade. Every year. The full picture across all 38 states is documented in their subsidy tracker database, which Good Jobs First maintains as a public resource.
Good Jobs First also argues that non-reporting states aren’t just keeping residents guessing. They’re violating standards set by the Governmental Accounting Standards Board, a private body that writes financial disclosure rules for state and local governments. That’s the kind of detail that doesn’t make headlines but matters: states have legal-adjacent obligations to account for public money, and at least 14 of them aren’t meeting those obligations when it comes to data centers.
So what’s driving this? Data centers are the physical infrastructure behind every app, streaming service, and cloud platform most people touch daily. From a local government’s perspective, they look irresistible on paper. Construction investment runs into the hundreds of millions. Equipment purchases are massive. The company’s name shows up on the tax rolls.
The problem is what comes after the ribbon cutting. Data centers don’t generate many permanent jobs relative to their footprint. A hyperscale facility covering dozens of acres might employ 50 full-time workers once it’s operational. The electricity and water demand, though, don’t scale down after construction ends. They scale up. Communities near large data center campuses have seen utility costs climb as the facilities draw outsized shares of regional power capacity.
All 38 states with dedicated incentives got to this point through competition, as tracked by the National Conference of State Legislatures. Companies like Amazon Web Services shop proposed campuses across state lines, and states respond by sweetening their tax packages. The race doesn’t stop.
Michigan is one of the states that does report its data center incentive costs, which puts it in a smaller club than you’d expect. Thirty-eight states offer these programs, but only 24 publicly account for them. That’s a majority of states in the dark heading into 2026, with more facilities coming online through 2027 as hyperscale operators continue expanding.
The pattern Good Jobs First is documenting isn’t limited to data centers, but data centers are where it’s most acute right now. The subsidy amounts are enormous. The job creation numbers are modest. And the communities closest to these facilities are absorbing real costs, from strained power grids to noise from industrial cooling systems, while their governments can’t or won’t say how much tax relief the operators received to be there.
It’s worth being direct about what $1 billion annually in forgone tax revenue means for a state. That’s money that doesn’t reach school district budgets, road maintenance accounts, or municipal services. When Georgia, Virginia, and Texas each report losses at that scale, and 14 other states won’t report anything at all, the question isn’t whether data center subsidies are working. The question is who decided the public doesn’t get to know what they’re paying.
