Reporting by Maggie Dougherty for Capitol News Illinois:
CHICAGO — In a surprise move, Gov. JB Pritzker announced Friday that he is putting a pause on all new state tax incentives for data centers and calling on lawmakers to pass new data center reforms during the fall veto session.
The governor has directed the Illinois Department of Commerce and Economic Opportunity to pause all new agreements starting July 1, fulfilling a proposal he made during his budget address earlier this year. The data center tax incentives have been in place as part of bipartisan legislation signed by Pritzker during his first year in office.
From 2020-24, there were 27 data centers that benefited by more than $983 million from these tax incentives, according to a state report.
In his announcement, the governor cited growing impacts on energy affordability and water resources.
“Illinois has an opportunity to continue leading in technological innovation and economic growth, but we also have a responsibility to protect working families and local communities as the data center industry rapidly expands,” Pritzker said.
“I am directing my administration to pause the processing of data center agreements while we continue working with the General Assembly and stakeholders on a comprehensive framework that protects affordability, safeguards our natural resources, and ensures responsible growth across Illinois.”
The move comes after lawmakers failed to pass House Bill 5513, known as the POWER Act, by the spring session deadline on May 31, following months of committee conversations and advocacy from environmental groups.