Southeast Michigan legislators team up on effort to revoke tax breaks for data centers
A bipartisan effort to repeal a fairly new Michigan tax break for data center developers is in the works in Lansing.
Rep. Dylan Wegela, D-Garden City, said he is sponsoring a bill with the support of Rep. Erin Byrnes, D-Dearborn, and Rep. Jim DeSana, R-Ash Township. Wegela said the representatives plan to introduce the package on Tuesday in Lansing.
The move is an effort to repeal Public Act 181 and Public Act 204 of 2024, which were intended to provide sales tax exemptions for data center equipment, should a project meet specific criteria.
There has already been $13 million in tax breaks claimed under the 2024 legislation, according to House fiscal analysts. That number is "expected to grow exponentially with nearly two dozen data center projects in the works," Wegela said.
The lawmakers referenced concerns that have been part of public comments during local government meetings on recent proposals over the potential for noise and infrastructure demand. Those projects include proposals that have gained public attention in Southfield, Howell and Saline Township.
"As we have seen elsewhere, these data centers produce few jobs, raise utility rates, and put a major strain on our energy resources," Wegela said. "We need to repeal the tax breaks that are encouraging these companies to flock to Michigan, and we have to demand strict regulation and public oversight of these projects."