Jobs, revenue, and the future Governor Scott just protected

By Ross Connolly 

Data centers are the invisible backbone of modern American life. Every call you make, every text you send, every app you open, a data center is working behind the scenes to make it happen.  

When a Vermont mom checks her child’s grade online, when a veteran gets his medical records without having to drive hours to the nearest VA, or when a small business owner processes a credit card payment, a data center made that possible. They power the tools that are helping doctors detect cancer earlier, the systems that keep our financial markets running, and the technology that lets rural students access the same educational resources as kids in major cities.   

Yet, many in our state continue to create roadblocks to this growth. H. 727, a bill introduced earlier this year, would have created additional regulations surrounding the construction and activity of data centers. Governor Scott rightly vetoed this bill, leaving the door open to jobs, tax revenue, and long-term prosperity for Vermonters. 

If this bill had been signed into law, Vermont wouldn’t have stopped data centers. It would have just stopped Vermont’s chance to benefit from them at a time when the state is already falling behind.  

The Northeast hosts hundreds of data centers—New York, Pennsylvania, Massachusetts, even Maine and New Hampshire all have significant data center facilities. Vermont has three. 

Recently, data centers have been unfairly maligned in recent policy discussions, but the numbers tell a different story. The industry contributed $727 billion to our country’s GDP in 2023 and generated $162.7 billion in federal, state, and local tax revenue. In Loudoun County, Virginia, data centers are projected to generate $1.3 billion in property tax revenue in 2027 alone, nearly half of the county’s entire local tax base.  

Data centers create high-paying construction jobs during build-out and stable technical employment afterward—exactly the kind of opportunity Vermont communities have been seeking for decades. And to be clear: data centers don’t need tax incentives or exemptions. They should pay what every other business pays.  

Critics have also raised concerns about water use, but the facts don’t support the alarm. Many data centers today use closed-loop cooling systems that recirculate water rather than consume it. In Maricopa County, Arizona, data centers used roughly 905 million gallons of water in 2025, while local golf courses used approximately 29 billion gallons. 

Innovation and human progress depend on developing data centers but doing so in a way that protects Vermont families. Responsible data center development requires that developers cover the cost of their own infrastructure through behind-the-meter generation, co-located power sources, and new transmission interconnection, rather than passing costs to ratepayers. Major technology companies have signed the Ratepayer Protection Pledge to “build, bring, or buy” all energy resources and infrastructure upgrades needed, while strengthening infrastructure to benefit surrounding communities. 

Local governments already have significant say in how and where data centers are developed through zoning authority, the permitting process, and community input. On top of existing oversight through Act 250 and the Public Utility Commission, the bill would have added punitive surcharges, vague and politically subjective approval standards, and compliance burdens that exist nowhere else in the region.  

Vermonters’ concerns about the impact of new developments are valid and worth addressing. But H.727 was a regulatory chainsaw when a scalpel was all that was needed. All this bill—and similar reforms in the future—would do is send a clear signal that Vermont is closed for business to an industry ready to bring massive revenue, jobs, and investment to our communities.  

Legislation that seeks to further regulate data center construction in Vermont will only cause our state to fall further behind, not just neighboring states, but in America’s broader race to lead the world in AI and advanced computing.  

Data centers are not a threat. They are proven drivers of jobs, tax revenue, and long-term prosperity. For everyday Americans, they provide something even simpler: the technology that allows a Vermont grandmother to video call and watch her granddaughter take her first steps from 300 miles away.  

Ross Connolly is the Northeast Region Director for Americans for Prosperity.