AI data centers are coming for federal land and roiling Nevada governor's race

BOULDER CITY, Nev. (AP) — Janelle Sorenson loves the clear night skies in Boulder City, less than an hour's drive from the bright lights of the Las Vegas Strip. It's a small, quiet town, and she thinks an artificial intelligence data center would ruin the community and scar the desert landscape.

So over the summer, she joined with other residents to successfully oppose plans for one of the giant computing warehouses that have popped up around the country.

But their victory was short-lived. The developers withdrew their application and instead sought adjacent land owned by the federal government — and the U.S. Bureau of Land Management signed off.

"Not only did we not get to decide anything or have a say," Sorenson said, "we were just really kept in the dark."

The Townsite data center was the first in the country to be approved on federal public land, though construction is stalled after a judge ruled that the government couldn't use an old environmental review from when the project was intended to be a solar farm.

Tech companies are eager for vast tracts to build data centers that can be as large as 70 football fields, and Townsite could set a precedent for similar projects on federal property with more than a dozen others in the planning stages. President Donald Trump has been a steadfast supporter of the artificial intelligence industry, which he views as a source of economic growth and part of a global competition with China.

However, data centers have been unpopular in many communities as voters worry about higher electricity bills, declining water supplies and other impacts. In Nevada, where 80% of the land is owned by the federal government, Townsite and other projects have become a dominant issue in the battleground state's closely watched governor's race.

Republican Gov. Joe Lombardo, one of his party's most vulnerable incumbents, doesn't outright oppose building data centers on public lands, as long as they have community support. He recently signed an agreement with Trump's Republican administration to streamline infrastructure projects, which could include data centers on federal lands.

Democratic nominee Aaron Ford, the state attorney general, has pledged to oppose data centers on public lands, saying affordable housing should be the priority.

Both say the projects, whether on public or private land, must follow state rules, such as requiring data centers to cover their own energy costs and protecting water supplies, or they would lose eligibility for state tax abatements.

Voters across the political spectrum unite against data centers

Sorenson, the Boulder City resident, considers herself to be liberal, but she said her conservative neighbors are on the same page as she is.

"We're all aligned on this," she said.

Autumn McGrath-Shook, who lives in the same town, said she recently left the Republican Party and registered with the Green Party over data centers, though she still identifies as conservative. Worried about the environmental impact on wildlife, she joined forces with "these crazy libs" to oppose the project.

Data centers have quickly become a "catalyzing issue" in the midterms, catching many politicians flat-footed, said David Damore, a political science professor at the University of Nevada Las Vegas.

Some state leaders who were previously supportive of data centers have rushed to respond. For example, Republican Texas Gov. Greg Abbott paused data center approvals until audits are completed, and Democratic Pennsylvania Gov. Josh Shapiro signed an executive order removing data center proposals from a fast-track permitting process and requiring them to receive local approval before seeking state approval.

READ MORE: Data center controversies have transformed midterms. Here's where different groups stand

In August, Ford announced his plan to pause new tax abatements for data centers while an audit is conducted to see if the projects have fulfilled promises about producing tax revenue and economic benefits.

In September, Lombardo, who has said data centers provide enormous economic opportunity for Nevada, signed an executive order placing more guardrails on data centers and requiring them to pay more taxes to support schools.

The two have successfully "muddied the waters" on their data center positions, Damore said.

Lombardo criticized Ford for co-sponsoring 2015 legislation that created the state's tax abatement program for data centers, a measure that received bipartisan support. Ford criticized Lombardo for giving more than $200 million in tax breaks to data centers, which is connected to the legislation that Ford co-sponsored.

Ford told The Associated Press that he would use "every tool" at his disposal to prevent data centers from skirting state guardrails, including withholding tax abatements and pursuing litigation.

Lombardo, whose campaign declined to make him available for an interview, has a similar pitch. His office said he would not hesitate to confront the federal government to advocate for Nevadans.

But that's not good enough for McGrath-Shook, who is on the fence in the governor's race. She thinks Ford is soft on crime, but she views Lombardo as more pro-data centers.

"I would much rather vote for Lombardo than Aaron Ford in a normal world," she said. "But with the looming data centers, it really changes the landscape — and literally."

Data centers on public lands are the latest effort in AI race

Last year, Trump signed an executive order to accelerate permitting for artificial intelligence data centers, and his administration has rolled back the National Environmental Policy Act, saying the bedrock law needlessly delays federal approval for energy and infrastructure projects.

Dan Diorio, executive vice president of state policy and government affairs for the Data Center Coalition, said the industry wants to be a part of the conversation regarding responsible development on federal lands.

"The good-faith actors in this space are going to be approaching that development responsibly," he said, "ensuring that it's going to do no harm on important federal lands."

But environmentalists are concerned about data centers developing on federal lands to skirt environmental protections and laws and circumvent permitting processes. They're generally opposed to using public lands for the projects in the first place.

"We believe that public lands are reserved for public good and should be protected and kept in trust for future generations," said Olivia Tanager, director of the Sierra Club's Toiyabe Chapter. "And the idea of using public lands for data center construction totally flies in the face of that set of values."

She said Congress should pass legislation with new standards for environmental reviews and public engagement that could slow development.

"Short of some type of legislation to that effect," Tanager said, "we're staring down the barrel of having many data centers move forward on public lands over the next few years."