Ohio pauses new data center tax breaks as Adams County debate grows

The state’s pause on new data center tax breaks sharpens a local question in Adams County: before any deal moves forward at the Killen or J.M. Stuart sites, what should residents demand in return for giving up tax value?

Gov. Mike DeWine said he directed the chair of the Ohio Tax Credit Authority to stop considering new requests while the Ohio General Assembly’s Joint Data Center Committee studies how fast the industry is growing and what Ohio is giving away. The incentive under review includes a 100% sales-tax exemption on construction materials, and state data suggested the cost of that break may have been underestimated by more than $1.4 billion. For Adams County, that matters because any project here could depend on the same subsidy structure now under scrutiny in Columbus.

That pressure is arriving while county leaders continue courting developers for the former Killen and J.M. Stuart power plant sites on the Ohio River. Adams County economic development director Paul Worley has said the nearest house is about a half mile away, and he has signed nondisclosure agreements with companies exploring the sites. The county’s pitch is straightforward: the old power plant properties already have power and water access. But the governor’s pause gives local skeptics a stronger argument that the public should not move too quickly on tax breaks before the economics are clearer.

The debate is rooted in what the county already lost when the coal plants closed in 2018. Their shutdown eliminated 700 jobs and cost Manchester schools $5.5 million in funding. More than 1,400 acres of coal ash ponds remain on the former plant properties and have not been fully remediated, adding environmental and site-preparation questions to an already complicated proposal. Residents pressed those concerns at a town hall in Manchester on Feb. 18, where they raised fears about 24-hour construction, local infrastructure and whether the promised gains would stay in the county.

The scale of the potential project has also raised alarms. On Feb. 3, AES Ohio told PJM Interconnection that a data center near the former Stuart plant would need 1,300 megawatts of electricity by 2032, a load WCPO said would make it larger than any existing data center in Ohio. AES Ohio said the grid review could take up to two years or longer, which means the project is still far from a final buildout.

The permitting and political fights have widened since then. On March 9, the U.S. Army Corps of Engineers issued a permit for work near the former Stuart plant with special conditions to protect endangered bats, mussels and butterflies, plus a 100-foot buffer around three cemeteries. By March 30, Attorney General Dave Yost had verified a proposed statewide ballot measure to ban large-scale data centers, and organizers said they would need more than 700,000 signatures by July 1.

DeWine’s pause does not end Adams County’s debate. It does, however, force a harder local reckoning over whether the county should accept a fast-moving proposal built on incentives, or wait until the jobs, tax base, power demand and public costs are better understood.