Support for Gov. Hochul’s Commitment to Pass Law Banning IDA Sales Tax Breaks for Data Centers

Reinvent Albany is encouraged to see that Governor Hochul wants to work with the Legislature next session on legislation that would eliminate sales tax abatements to data centers, as reported in Politico.

Reinvent Albany supports S9182-A (May) / A10852-A (Kelles) that would comprehensively prohibit all subsidies to data centers. We worked with Senator May’s office on the legislation and believe it is the only bill in the Legislature that ends both local and state sales tax, property tax abatements for data centers, and New York Power Authority (NYPA) programs that provide millions in very low-cost hydropower to data centers.

NYPA programs like ReChargeNY provide power costing 1/6th of what the average New Yorker pays to data centers, including to 365 Data Centers NY (Commack), Databank Holdings (Orangeburg), 1547 CSR (Orangeburg), and Kyalami Data (Lansing). There are more planned data centers in the NYS ISO large load interconnection queue that are likely to seek low-cost electricity. 

Reinvent Albany strongly opposes New York laws and programs that subsidize data centers. We especially oppose “Tax Breaks without Representation” in which state law allows local officials at county, city, and town industrial development agencies (IDAs) to functionally spend state tax dollars in the form of providing state sales tax exemptions to data centers or other companies. These local officials have no fiduciary duty to state taxpayers and can, and do, waste tens of millions in state sales tax dollars to create small amounts of local property taxes – as is being done in Rockland County.