To amend section 122.175 of the Revised Code to prohibit new data center sales tax exemptions from being granted.
HB957 would amend Ohio Revised Code section 122.175 to end the state’s ability to approve new sales and use tax exemptions for computer data center equipment. Under current law, the Tax Credit Authority may grant a complete or partial exemption for qualifying data center projects that meet investment, payroll, and operational requirements. This bill would prohibit new agreements from being entered into after the effective date of the change, while leaving the existing statutory framework in place for any agreements already approved before that cutoff.
The bill preserves the detailed eligibility and compliance structure already in law for existing agreements, including minimum capital investment thresholds, employee compensation requirements, annual reporting, verification by the Department of Development, and potential clawback or termination provisions if a project stops operating or fails to comply. It also retains the confidentiality rules for applicant information, the direct payment permit process, and the annual reporting obligations to state leaders, but those provisions would apply only to agreements that were already authorized before the new prohibition takes effect.
If enacted, HB957 would narrow section 122.175 by eliminating future data center sales and use tax exemption agreements, effectively closing the program to new applicants. Existing agreements would continue to be governed by the current statutory terms, so the bill would not automatically disturb previously approved exemptions, but it would prevent the Tax Credit Authority from granting new ones for eligible computer data centers. The bill would therefore reduce a state tax incentive available to data center developers and operators and could affect related economic development, local tax base considerations, and project planning for future facilities.
The bill appears to reflect a generally restrictive or skeptical view of expanding data center tax incentives, since its stated purpose is to prohibit new exemptions rather than modify or extend them. Because the bill was only introduced and there are no committee transcripts or recorded votes in the provided material, there is no documented floor or committee sentiment to measure support or opposition. The available context suggests the proposal is still at an early stage in the legislative process.
The main point of contention is likely whether Ohio should continue using sales tax exemptions to attract data center investment. Supporters of the bill would likely argue that the exemption is an unnecessary subsidy or that the state should stop granting new tax breaks to large technology facilities. Opponents would likely argue that the exemption is an important economic development tool that helps secure capital investment, payroll growth, and related infrastructure spending. The bill text itself does not include negotiated compromises, and no committee testimony or votes are available to identify specific stakeholders beyond the general interests of state economic development officials, data center operators, and tax policy advocates.