Data Centers in Your Backyard – Pros, Cons & Why Local Control Matters

Hinzugefügt: 2026-05-22

[00:00:00]I read a statistic that 70% of Americans oppose data centers throughout the the country. And I think that's in situations where you have no local control. And so I think when you have no local control, I think that's going to be tenfold hot button item long term. And so I I do worry about that and and the backlash. I I've stood up against a lot of very powerful people with my opinions and I I know I have to So, if you're like me, you've been hearing about these data centers coming to our neighborhoods. Maybe there's a part of you that is skeptical about them. Like, no one asked me if it was a good idea, but you don't really know that much about them. You don't really know what they are or why this is happening. And so, to help us unpack that, I've invited a friend of mine, Cara Keys. She's a small business owner, someone who has been uh has testified as an expert on land use issues and is a county commissioner for Jefferson County, West Virginia. Cara Keys, thanks for coming on the podcast.

[00:01:06]>> Thank you. Thank you so much for having me, Matt. I appreciate the opportunity to speak.

[00:01:10]>> So, let's just start very basic. What are data centers? Do we really need to be building them? It's a open-ended question and there's a lot of opinions on data centers whether or not we need them but but truly I think we do need them in some degree. I mean if we use our phones, if we use you know chat GBT, if we post on Facebook, all of those things uses data centers in order to send information and receive information. And so there is a component that unfortunately we have just we have developed in a way that we do need data centers. So, you know, how they're built and the way they're constructed do differ variably. And so, you have a lot of folks that how will have a lot of negative feedback with data centers, but then you also have a a lot of credible good things that data centers can do if they're if they're built right. So, it's a it's a very complex issue, which I know we'll get into, >> right? I mean, so I guess one question is from my standpoint.

[00:02:11]Um, this is sort of like I when I used to live in the DC area, one day I woke up and there were all these like bikes all throughout the city that you know you could like swipe your credit card and get on a bike and people would just like throw them on sidewalks and then there were scooters and it's like no one asked me if we should do this. I didn't vote on this. They just showed up and changed my world. And you know, everyone tells you you have to wear a seatelt.

[00:02:38]You have to wear a helmet. But you don't have to do that if you're going to ride one of these scooters or bikes around town. And um but I'm guessing at some point maybe there was a hearing. Maybe I could have voted if I were more active in my community. Like are these like does the public do citizens have a vote on this or is it just happening?

[00:02:58]>> Absolutely. And to take us back 10 to 20 years, Data Center Alley, the largest data center development in the United States is in Northern Virginia, which is very close to where you and I live. And so, Laden County, Virginia is kind of the epicenter of data centers. And so, about, you know, close to 20 years ago, they started with data center development. And as time has gone on about 3 to 4% of their imperous area or their area in which can be developed for anything has been now constructed with data centers. And so Ashurn, Virginia, all these areas have about 3 to 4% of their county land for data centers. And so what's happened if you if you take a look at just Lowden County as an example, they have almost $4 billion a year in real estate tax revenue that go directly to the county. And of that $4 billion, almost half is directly from data center real estate taxes. So that county has been able to almost double their revenues because of data centers on that 3 to 4% land. So, it's it's a very learning thing for politicians, for folks who want economic development.

[00:04:13]There's there's pros in in that regard and and there's a lot of things to to separate here. But with with Lden County, they have zoning ordinance and they have >> they have abilities for uh us to um develop four data centers. Um and they had strict so sorry to uh but I'll keep going back. Um so with Lden County they have data center regulations. So for example when they first started to come on the market about if they backed a proposed data center would go next to a residential subdivision they would have up to a 200 foot buffer minimum. So if you were to a setback, so if you were to be in a residential development in a data center is now being built next to your property or your neighborhood property, they have they cannot build their improvement 200 feet within 200 feet of your neighborhood. And so that was a way to kind of curb some of the the push back. And that's standard for industrial or any sort of uh professional office commercial development. Uh but over time what Lowden County the trend they've had is they've actually increased those setbacks. So what was 200 feet is now 500 feet. And because they have learned that these there's noises associated with them. They're not as necessarily as bad as people think. There are uh times every week that they will test their uh diesel generators and that's when you will hear the loud hummings and that sort of thing typic. But they have other things to consider and it's the size of these developments. You know, you have 70 foot tall concrete structures that can look very good and sophisticated, but they can also sometimes not look very sophisticated. So, that's something to to keep in mind because these vary greatly. So, it's like it's like comparing, you know, I have a home school in my house and not really, but say I do. It's like comparing that to a an actual public school. They're very different, but they both teach a curriculum. And so data centers can vary greatly. And that's why there's so much misinformation and information about pros and cons of data centers because they vary so greatly in how they're developed, their standards, and the impacts on residents. So sometimes they can have negative impacts and sometimes they can be built in such a way that are are mindful of their constituents and and their neighbors do well in the market. So, I know these data centers, I mean, obviously if you're a tech billionaire, if you own an AI company, they're probably great for you. Um, I know that they're helping right now with the jobs market as you do do construction of data centers, you have to hire people to construction workers, but I'm wondering about the long-term benefits. It's like is this like a sugar fix that is temporarily helps the economy but then it will sub you know go away or will this actually these data centers actually continue to provide money jobs whatever for communities >> you that's a great question there is definitely an influx of jobs during the construction phase and there will be jobs depending on the size of the structures now to take a step back as I said you know that's they range vary greatly. Some data centers will have such a large footprint that they'll have a small office portion within the building because it's such a large facility and then in other cases they'll have a couple of employees that will show up. So the construction is definitely where you have the job market. However, the real estate tax revenue that is generated every year from these data centers will be that consistent economic development. And so I think from a land use perspective and someone who's, you know, a commercial appraiser and a county commissioner, what I care about in my county is having a diversified commercial tax base.

[00:08:05]Something that you can ensure that you're not putting all your eggs in one basket so that you have a strong economy and true economic development. So, the way I look at data centers is if they're they're put in the right places with the right type of regulations around them and are a certain amount of percentage of our of our land, they can be a good thing. They t-fold real estate tax benefit than something that would be zoned industrial that would get a much lower um return annually with real estate taxes. However, with that, you don't necessarily have the the job market that you would normally have in an industrial setting. So there's pros and cons to that, but as far as the real estate tax revenue, they have both the real property, the equipment that's within a data center. They have the building itself, and then the land that's valued. So those three components, depending on where you live, what state, what county, those are the kind of the three ways that an assessor would assess that property, and then the county would benefit financially from.

[00:09:06]And that that that benefit goes towards paying teachers, first responders more.

[00:09:11]you have some of the highest uh teacher pays in the country in Ladden County schools and part of that is because of the revenue from data centers. So there there are definitely pros but there are definitely negatives with with lack of jobs. But if you have a you have a robot a robust economy it can be a good thing if it's paired well >> and the revenue is not going to go away.

[00:09:33]The revenue that's funding Lowden County teachers you're saying that's going to continue every year. It's not like just the construction of it.

[00:09:41]>> Correct. Correct.

[00:09:42]>> Is because it's part of the it's taxes.

[00:09:45]>> It is the real estate taxes and and they have you know in West Virginia we have salvage value for that personal property components within the data centers. You know the the technology component in Lowden County. They have something similar where they they assess the personal property and the lifespan of of that equipment which is one of the three parts that they value does have a shorter lifespan but they replace these things ongoing. So it may fluctuate a little bit, but those those components are replaced usually within 5 years because they do quickly become obsolete just like a computer at home. You would want to replace your laptop after a few years.

[00:10:20]>> And you mentioned the noise that these data centers generate, the possibly, you know, eyes sore that if they're not constructed correctly or aesthetically beautifully could could be I I'm told you they consume millions of gallons of water. Uh I've heard this is anecdotal but people are complaining that their electricity costs are really going up and they blame the data centers for rising electricity costs. Like how much of that is true and what did I leave off the list of the kind of the negative externalities?

[00:10:53]>> Yeah. And there's a whole component I'm sure we'll get into eventually. you know, I'm talking broad terms nationally and then, you know, there's some specific stuff with West Virginia that's a little bit different. But the the the problem with the energy is there's two there's two really glaring issues with data centers. It's where they're getting the water from and where how much electricity they're using and what the cost burden for that constituent, that county will have to carry with that. Uh, so energy is typically not based on your state or your county. So, think of it if you have a power line that goes through your your county and it's and you're pulling it from one location and you're in the middle and it's going to another state or county, they're the ones that are financially benefiting as a county for those services, be able to pay teachers more, having that as a economic tool and you're still because you're on one grid system. If the electricity rate does go up, you could be impacted regardless of whether it's within your county or out of your county, within your state or out of your state. So for us, the PJM line is a multi-state power source that we all share regionally. So if Lowden County, which is our neighbors, as they've continued to grow, the grid increase of electricity has risen for all of us without West Virginiaians benefiting. So that's that's the multi-layered part of it. And then with that there are studies both for and against that point and I'm not a I'm not an electricity uh expert u but from what I've understood is that the data centers in order to tap into the electricity grid they have to pay a huge sum uh in order to buy into the grid.

[00:12:44]all the infrastructure um components associated with adding their facility to the grid. So, it could be $200 million that they have to pay into the electricity company or that grid network in order to um add that data center.

[00:13:00]Now, how that raises electricity rates, I can't speak to whether it does or doesn't, there's been studies that say both they do and both they don't. So, because I'm not an expert in that, I probably shouldn't speak or give an opinion. It is something to note that having a data center in your county versus right next door to you will vary greatly on what your, you know, your quality of life will be from an economic development standard from having that, you know, continual revenue stream going into your county. But then of course there's environmental concerns that we should always be talking about because there needs to be always guard rails and common sense you know instituted in in this data center development. There's two there's two two ways of looking at this for sure, >> right? And you know, so as you know, I mean, West Virginia has a long long history of being exploited by big business who basically come here and do mountaintop removal or mining, all sorts of stuff, extracting resources.

[00:14:09]I mean, I think right now we have these very ugly, not nothing against solar panels if they're on the roof of your house. We have these very ugly solar panels that I'm told don't even uh provide energy to West Virginia. It goes to Virginia. So, West Virginia has a long history of kind of being exploited in this way. And as you've sort of noted, there seems to be a uh a smart way to manage data centers and a dumb way to manage data centers. So, how how is West Virginia or at least the eastern panhandle of West Virginia doing on that front?

[00:14:42]>> Yeah. And I I think I come from this from an interesting angle because I'm not pro or anti-data center. I'm pro having common sense when you're developing because these buildings range from half a million to million square feet building. So, think about a school.

[00:14:58]It could be 50 times a school footprint.

[00:15:01]And so the the cost to remove this building could be $300 million depending on I mean if you associate $15 a square foot time whatever the square feet is that's probably within ballpark of what it would cost to to demo. And so these are these are going to be here for a long time. So once they're built they're there. So how do we how do we build them with development standards in mind? And so taking a step back on on the national and I've kind of kind of glazed over how it's typically done, the pros and the cons from an economic development standpoint. The the problem that we have in West Virginia comparatively to the rest of the the United States is that we have one bill that removed all local control and allowed for data centers to go wherever they want, however they want. And so this was House Bill uh 2000. Bill >> allowed the state to decide work with the land owner to and the data center developer without the counties or cities at the table codified. So you know of course they might add policies to give us a heads up, but there's nothing codified in the law that ultimately passed. So, in every other county, in every other state in the United States, they have local control. You could have a public process. The planning commission is, you know, I sit on the planning commission here in Jefferson County, and there's usually some there's always some sort of public process that you can speak to. They can ask for profers. In our county, we are one of the only counties in the state that have countywide zoning, both in our municipalities and our county. And that's standard in most developed states in in the country. You know, Maryland next to us, uh, Virginia, they have countywide zoning in where these data centers are going. They have setbacks and vegetative screenings and all these things that you would expect to be done.

[00:17:04]And so there was in the bill there was nothing put in the bill in the policy that allowed for uh 200 foot setbacks or thick 50 foot vegetative screening requirements so that you could have some sort of distance and screening from neighbors to allow their property rights to be protected. And so the kind of the the clickbait term in West Virginia is they always talk about my property rights. You know, property rights matter. This is this is our property rights to be able to put data centers wherever we want. Well, there's two there's two ends of that. There's your property rights as a developer and I understand that and respect that. But there's also the property rights of the constituents that live around you. And it's my job to balance both the development and my neighbors, my constituents who might be negatively influenced by impacted by these data centers. So folks who have if they're pooling, so the two big things with data centers in general is electricity and water. And so if and for for example in West Virginia we don't have any law that says they have to have a um a non-eoperative cooling mechanism you know where they have they pull less water. We don't have any codified requirements on that. We don't have any codified requirements of not pulling from the aquifer which is shared water that everyone with wells would would essentially pull the same water from which takes hundreds of years to recharge. you know, if you draw past draw past the recharge rate from rainwater, you know, you you will essentially be just continually depleting your water source. And so there's there's very important components of data centers that you want to steward carefully. And so with with Jefferson County, you know, I I I worry about the negative long-term development of data centers in the in the sense of that this law does not codify these sort of protections. But I have been I've had really good conversations with a lot of the data centers that have one particular QTS. They they are coming in at some point in straddling the border of our county and Berkeley County and they've been so far very willing to talk. They are they have been transparent even though they're not required to. They've attended a forum with myself and a few other folks and they've answered a lot of my glaring immediate questions. you know, for example, they are not going to be pooling from groundwater. And so that's a very important issue and concern with, you know, residents in my county because we are entering a third year uh of drought conditions in our county and we have car topography and so all those things do worry um our farmers and our residents and so they've they're pulling from public water, surface water, and they're doing other things to to be good neighbors. And I I that location for our county is in an industrial zzoned area.

[00:20:01]So it's something in theory we would have could have approved at some point anyway. And so you know but the local control missing there's a lot of room for error now because essentially just to make it very simple is you could have a data center >> come out of nowhere and the commissioners we would not have any idea constituents would have no idea until it's uh basically approved certified by the state and it will be announced that we'll have no detailed information about where the buildings will what the water source will be what sort of environmental concerns are answered. It will be up to the data center developer to be willing to release that information because the state does not require that codified. So, it will be up to the company being a good neighbor.

[00:20:52]And I hope that they will. That's my goal. And and I I I want this to be a success in in Jefferson County, but I also want to be transparent that this could go left real quick.

[00:21:04]>> Yeah. Well, I thought Republicans were supposed to be in favor of this idea of local control and subsidiarity and that that that you know the local local communities know best better than big government. And I'm wondering why it is.

[00:21:23]And I believe that this was done by Republican governor, Republican state legislators, several of whom were just reelected like a week ago.

[00:21:35]And I'm guessing if you were to ask the typical West Virginia red hat, if I went down here to Walmart and ask them what they think about data centers, they probably hate them. And yet, why why would why would the West whoever made this decision, the the Republican leaders in West Virginia, why why would they want to cut out local authority?

[00:21:57]Why why would they want to help data centers and give them cart blanch authority to do whatever they want? like what what are they getting out of it?

[00:22:04]>> I agree. I think um and that was a a a concern of mine as a Republican as well.

[00:22:10]We are the as a county commissioner, I'm the closest person to my constituents and I absolutely support local control and we are we are the people that walk into a Walmart or an Aldi and see my constituents and I'm the closest person representative to my people. Yeah, I have no control over these things. And there's no public process, no public hearing where residents can be heard if they if they have a farm right next door to a data center that's that's announced. There's no there's nothing that I can tell them other other than you can reach out to your legislators.

[00:22:46]You can reach out to this person who's in charge in the state now. And you're right, the the Republican principles is small government and C and to not have centralized big government, big power.

[00:22:57]That's I think the opposite of what the Republican party platform is. And so that's that's a concern of mine as well.

[00:23:04]I think the reason that it was done and and the the arguments I've heard is that they wanted to cut red tape. They wanted to have they wanted to supercharge West Virginia's economy. You know, we we are ranked 50th in a lot of things. You know, uh obesity, workforce participation, education's close to the bottom of the list. We have a lot of areas that we need to improve. We don't have clean drinking water in the southern part of the state. There's huge issues with West Virginia as far as financial limitations. And I think the leadership, you know, in in good faith wanted to recharge our economy and be proactive in that. And I I wish we could come up with a solution that still upheld our principles as Republicans and listening to our constituents, but still being aggressive in bringing data centers in our state. You know, there is opportunity with data centers and and I don't want to knock them at all because they can be a good slice of the pie, but they are one slice. They're not our whole not our whole pie. And it's it's like I think what you said earlier, we're trying to catch the new golden goose egg. And this might not solve all of our problems if it's not done well.

[00:24:21]And what might help us for 10 years might hurt us for another hundred. And so we want to make sure that before we're building them in certain areas, you know, in Jefferson County, we we lead the state in tourism. So, you know, we want to make sure that these data centers are we have a 20 we have a, you know, a comprehensive plan that we we steward for over the next 20 years. And we have a zoning ordinance and we have areas that are industrial in nature that we could steward these data centers, which was our goal. That's something we voted on before the HB204 bill came in and that would allow for data center development in industrial zoned areas.

[00:24:59]And those are things that we, you know, could have done methodically and carefully and with public process and could have still resulted in a great resource for, you know, economic development for our county. And so the bill, just to back up a bit, in 2025 when it first hit the floor, it initially took all of the real estate tax revenue from the counties. And there was a line item of how it would be redispersed throughout the county, throughout the state. And one of them was a reduction of income state tax. And that was one of the big goals of this is to eliminate income state tax for the entire state. And that is a very very great goal to have. It's a competitive goal. We are if that happened, we would be one of the closest states to DC. So we would be competitive for a population growth as well and growth in commercial industry as well. However, with that, you are taking the economic development opportunity from counties to allow them to steward that money to be able to improve their counties, improve their way of life, and put money into their parks, build out uh, you know, their parks, build out their local economy, improve their roads, potentially infrastructure, grants, allowing for teachers and first responders to be paid more. right now we struggle the the teachers that are next door to us in Virginia sometimes make 30,000 more than the or more than the teachers that live here and so we've had a retention problem with teachers we have first responder problems they the same problem exists with um you know all of our first responders and so it's when that bill started we the fact that we got 0% to the counties throughout all 55 counties was the largest concern about the bill because it completely flipped how we have economic development and it centralized that deciding u factor and so it ultimately changed in the house and senate to 30%. And and 10% is shared per capita per person throughout the state. So, we still will have a good amount of real estate taxes, not what we would have had if it were any sort of other type of commercial development, but it's still it's still a good pot of money.

[00:27:17]>> And this sort of, you know, top- down centralized politics. I mean, Donald Trump has done stuff like this. I don't know if this went through, but he wanted to make it illegal where states couldn't sue AI companies. Um, and it's just it's it's like an ethos. And I'm wondering, you mentioned how the difficulty of of bumping into constituents and citizens who want to talk to you, but you don't have control over this one aspect. What is your sense of the folks you encounter? They're like, are they pro- data center? I bet you, my guess is that most just average folks around here hate data centers, don't like the idea, and at some point there could be a populist revolt. How did how did you let this happen? Why are we, you know, what happened to our beautiful area? We've got Harper's Ferry. We've got Shepherd's Town and we've got these huge data centers. Like, how did you let this happen?

[00:28:12]>> Right? And it's a a frustration I have because I feel like even my head will be on a spike even though from the onset when it first passed the House of Delegates in April 1st of 2025, I was one of the first people first electeds to speak out against this bill and not speak out against entirely but say, "Hey, they're major major pitfalls and in an alarming way." And I put it on my uh commissioner page. I went on the radios. I emailed my legislators. I attended every public forum with our legislators, you know, the past close to, you know, year and a bit. And I've emailed and I've talked with uh, you know, the head of the data center division within the state who's been very kind and willing to talk, but there's there is going to be, I think, a huge backlash from this long term. I I just I knew I had to speak up and whether whether or not, you know, if if they can steward this next session so that we can have better guard rails, I will feel a lot better and I know my constituents will appreciate it long term. I think I think I read a statistic that 70% of Americans oppose data centers throughout the the the country.

[00:29:27]And I think that's in situations where you do not have no local control. And so I think when you have no local control, I think that's going to be tenfold hot button item long term. And so I I do worry about that and and the backlash.

[00:29:45]So I I have stood up against a lot of very powerful people with my opinions and I know I have to. It's my duty. I have my am elected by the people for the people, not for anyone above me. And so it's my it's my responsibility to speak up and hopefully change the policy moving forward to a more digestible policy. Uh, you know, one of the things about conservatism is, I mean, obviously there's an element that's associated with economic prosperity and business and all of that, but if you think about like conserving the good, the beautiful, and you know, we're in a beautiful area.

[00:30:23]And I think that has to be taken into consideration as well, like the environmental, and I'm not just meaning like green stuff, but like preserving beauty, and part of that would be like farmland. I just wanted to ask you about this while I have you. You know, right now housing costs are very high for a variety of reasons. A lot of people think we need to build more housing. On the other hand, if you live in a beautiful area and you start seeing these kind of cheaplymade McMansions going up, that's not necessarily great either. And then you've got beautiful farms, but man, if I own that farm, I'd be pretty tempted to sell it to a developer who's gonna like give me, you know, a lot of millions of dollars. So, like, how how do you think about this?

[00:31:11]What's the right way to think about preserving history and farmland, but also managing like a growing community that probably needs more homes, frankly, >> right? Well, I think it's interesting the environmental issues that are always brought up, I think, don't don't belong in a political category. I think the Republican platform does believe in clean water, clean air, and the the Democratic party also believes in, you know, strong, you know, guard rails as well and and protecting our environment. I think there's a lot of common ground that we as Americans can agree on that we want to steward our land appropriately while still having economic prosperity. So you can have two things uh as long as you are willing and able to have critical thinking applied to your decisions and also being willing to talk to people. I think we have created such a such a difficult situation in in America quite frankly where we can't talk to people that think differently than us and and that that lack of civility that has has been lost needs to be rebuilt and it's something that I truly care about and I want to be part of that solution. We we can have different viewpoints. You know, you and I can disagree on five out of 10 things, but if we can find common ground on the five things and create a policy that you and I both can digest while not altering our viewpoints and our and our passions and our values, I think that's something we need to get back to. And and so with data center development, we have to be able to apply critical thinking and we have to be able to talk to each other.

[00:32:57]Whether you're a Republican, a Democrat, an independent, a constitutionalist, a mountain party, we have to be able to sit at the table and talk to each other, talk through these policies and and not just make decisions or accusations and go on the attack mode. You know, I always want to work with my, you know, fellow fellow electeds. I want to work with my constitu what we are. And we but we also we have out of control housing right now. And so we have a a continual population increase without that diversified commercial component increase at that same rate. There is a financial need for us from a real estate tax revenue for paying for our operations and our expenses as a county, you know, for our first responders, paying for fire and EMS. We need to be able to have the commercial real estate tax component in order to have a wellbalanced economy. But with that, we want to make sure that we're still honoring the traditions that we have and and the economic development that that are that is supported by our residents.

[00:33:55]So, there's a balancing act. And I think one of the the the ways I've I've done well as a commissioner has been able to have an open dialogue with my constituents. And I do feel like they they see me as someone who will listen to them. I might not always vote the same way that they would want, but I think they understand I have their best interest at heart, whether they're a Republican or a Democrat.

[00:34:17]>> Awesome. Well, I really appreciate you taking the time to talk to us through this. It was a pleasure. And uh Cara Keys, thanks for coming on the podcast.

[00:34:26]>> Thank you so much, Matt, for having me.

[00:34:27]I appreciate it.