Arkansas isn’t the only state wrestling with data centers. Across the country, states have spent the better part of a decade handing out tax exemptions, property abatements, and infrastructure commitments to lure the industry, and a growing number are now asking whether any of it was worth it.
The answers, where states have bothered to look, are not particularly encouraging.
The most basic problem is that most states, like Arkansas, haven’t looked very hard. A November 2025 report from Good Jobs First, a nonpartisan watchdog group that tracks economic development subsidies, found that Arkansas is among a significant bloc of states, including Alabama, Idaho, Iowa, Indiana, Louisiana, Maryland, Missouri, Mississippi, North Carolina, North Dakota, Oklahoma, South Carolina, and Utah, that fail to report the cost of data center incentives at all publicly.
In states that do report, the numbers are striking: Georgia, Virginia, and Texas each report losing more than $1 billion per year in revenue to data center tax incentives, and those losses are accelerating. Georgia raised its cost projection for fiscal year 2026 by 664 percent, to $2.5 billion, and projected nearly $3 billion in losses for fiscal year 2027.
That context matters for understanding what AEDC Director Clint O’Neal admitted at a May 20, 2026, Joint State Agencies Committee meeting in Jonesboro: that his agency doesn’t have the comparative data to evaluate whether Arkansas’s data center incentives are producing a return.
When Rep. Wayne Long (R – Bradford) asked for a basic jobs-per-megawatt comparison between a steel plant, a manufacturer, and an existing Arkansas data center, O’Neal’s team said they’d try but couldn’t commit; they don’t have the power-usage data for manufacturing facilities needed to run that analysis. Arkansas isn’t just behind on tracking outcomes. It’s behind collecting the inputs needed to even start.
The states that have run the numbers offer a preview of what Arkansas might find. Taxpayer costs routinely exceed $1 million per permanent job — subsidies that favor capital investment and not job creation. One analysis of subsidy deals with dominant tech firms found the average cost per job created was $1.95 million. Data center companies routinely stack incentives, collecting sales tax exemptions, property tax abatements, and income tax credits simultaneously, often with no caps on the total tax-break benefit any single project can receive. Good Jobs First notes that the poor quality of disclosure across most states makes meaningful data analysis and comparisons nearly impossible, leaving communities and lawmakers without the information needed to evaluate whether the deals they approved were worth making.
Those are the numbers O’Neal was gesturing, without having them in hand, when he told the Jonesboro committee that giving away a prime, rail-served industrial site to a data center “would not be worth it for a community to pay such a high opportunity cost.” (00:50:53)
The national data suggests he’s right. It also suggests Arkansas has been making that tradeoff without the information needed to know the costs.
When Arkansas enacted its data center sales tax exemption in 2023 (Act 819 of 2023), the state couldn’t project what it would actually cost — and two years later, that’s still the case. In its analysis of the 2025 expansion (Act 548 of 2025), the state noted that as of March 31, 2025, no data centers in Arkansas had applied for or received the qualifying sales tax exemption, making any potential revenue impact ‘indeterminable.’ The fiscal foundation underpinning Arkansas’s data center incentive program is essentially a placeholder. The state hasn’t collected enough real-world data to know what this is costing.
The policy response elsewhere is beginning to reflect the broader reckoning. Ohio lost $555 million to its data center tax exemption in 2024, and $1.6 billion in 2025 — prompting its governor to pause the subsidy for new applications. Indiana, after being criticized for failing to disclose its losses, recently admitted to losing $655 million to data center subsidies as of 2025, with more than 83 percent going to a single company: Amazon.
In Washington state, Gov. Bob Ferguson signed an executive order creating a multi-department task force to study how data centers affect tax revenue, carbon neutrality, and job creation. Good Jobs First recommends that all states fully report their losses from data center tax breaks — and at minimum, impose moratoriums on new data centers to allow time to accurately determine the full costs.
What those states recognized, and what Arkansas has yet to formalize, is that “economic development” is only as good as the outcomes it produces, and that you can’t measure outcomes you’re not tracking.
Arkansas communities are being asked to commit land, power capacity, and decades of tax revenue to an industry whose returns, by the state’s own economic development director’s admission, may not justify the cost.
Other states ran the numbers and are rethinking the deal.
Arkansas hasn’t run them yet.
Arkansas should not fall into the trap/excuse, “other states are doing it!” When government has too much money, this is the kind of foolish decision-making we get — with no accountability.
It is the job of voters to hold your elected officials accountable. They make the decisions. It is time we cut taxes and reduce the funds we have available for poor decision-making.
ICYMI:
To listen to the May 20 meeting in its entirety, click here.
Sources
Good Jobs First. Cloudy Data, Costly Deals: How Poorly States Disclose Data Center Subsidies. November 2025. https://goodjobsfirst.org/cloudy-data-costly-deals-how-poorly-states-disclose-data-center-subsidies/
Good Jobs First. Cloudy with a Loss of Spending Control: How Data Centers Are Endangering State Budgets. April 2025. https://goodjobsfirst.org/cloudy-with-a-loss-of-spending-control-how-data-centers-are-endangering-state-budgets/
Good Jobs First. Even Cloudier with a Greater Loss of Spending Control: How Data Center Tax Abatements Undermine Public Budgets. June 2026. https://goodjobsfirst.org/even-cloudier-with-a-greater-loss-of-spending-control-how-data-center-tax-abatements-undermine-public-budgets/
https://arkleg.state.ar.us/Bills/Detail?id=HB1654&ddBienniumSession=2023%2F2023R
https://arkleg.state.ar.us/Bills/Detail?id=HB1444&ddBienniumSession=2025%2F2025R
Hardy, Kevin. “Many States Don’t Report Losses from Data Center Tax Breaks, Study Says.” Stateline. April 15, 2026. https://stateline.org/2026/04/15/many-states-dont-report-losses-from-data-center-tax-breaks-study-says/
Garofalo, Pat. How to Rein In Big Tech’s Secret Data Center Deals. American Economic Liberties Project. November 2025. https://www.economicliberties.us/wp-content/uploads/2025/11/data_center_brief_FINAL.pdf
CSG South. “Data Center Tax Breaks: Innovation vs. Waste.” March 2026. https://csgsouth.org/policies/take-that-for-data-incentivizing-innovation-or-inefficiency/
Joint State Agencies Committee, Rural Development Subcommittee. Meeting transcript, Jonesboro, AR. May 20, 2026.
