Texas Senate Bill SJR 72

Texas 2025 - 89th Regular

• Filed: 3/11/25

Caption

Proposing a constitutional amendment to authorize the legislature to exempt from ad valorem taxation the total appraised value of real property used as a data center and the tangible personal property used by the data center to meet the data center's demand for energy.

Summary

SJR 72 proposes a constitutional amendment that would let the Legislature create a property tax exemption for certain data centers. Specifically, it would authorize a general law exempting from ad valorem taxation the full appraised value of real property used as a data center, as well as tangible personal property located at the data center that is used to meet the facility’s energy demand. The resolution also allows the Legislature to set additional eligibility requirements for the exemption. Because it is a joint resolution, SJR 72 does not itself create the tax exemption; instead, it seeks voter approval to amend the Texas Constitution so lawmakers can enact the exemption later by statute. The proposed amendment would be submitted to voters at the November 4, 2025 election, with the ballot language asking whether the Constitution should be amended to authorize this data center tax exemption.

Impact

If approved by voters, the measure would amend Article VIII of the Texas Constitution to give the Legislature explicit authority to exempt qualifying data center property from local ad valorem taxation. That would affect both real property and certain tangible personal property tied to the data center’s energy needs, potentially reducing property tax burdens for eligible facilities and changing the tax base for local governments and taxing units. Any actual exemption would still require implementing legislation, and the Legislature could narrow eligibility through additional requirements.

Sentiment

No committee transcript or recorded vote information was provided, so there is no direct evidence of debate or formal support/opposition in the available materials. Based on the bill’s structure, the measure appears to be framed as an economic development and infrastructure incentive for data center investment, which often draws support from business and development interests. At the same time, property tax exemption proposals commonly raise concerns about local revenue loss and fairness to other taxpayers.

Contention

The main point of contention is likely the tradeoff between encouraging data center development and preserving local property tax revenue. Supporters would likely emphasize attracting investment, jobs, and high-value digital infrastructure, while opponents may question whether large tax exemptions for data centers shift costs onto homeowners, schools, and other taxpayers. Another possible issue is the breadth of the exemption, since it covers the total appraised value of real property used as a data center and energy-related personal property, though the Legislature would retain authority to impose eligibility limits.