New York becomes the first state to impose a data center moratorium

I live in NYC and think the politics in the city and state have been a disaster for middle class people and see this as a continuation of that.

The electricity is expensive basically due to the state, so we have to block economically productive projects like data centers because we made our resources artificially scarce. I.e. Indian Point 2 GW Nuclear Site was shut down in 2021, replaced by Natural gas. And then we pay high prices for Natural Gas since we block building of gas pipelines.

NYC is also home to some of the worlds most productive financial and tech companies - it makes tons of sense to have datacenters located close by for latency reasons.

All these laws that block tons of economical construction are made by people who have already "made it" financially and then the class who benefits by having a robust construction, manufacturing, and machining type economy is screwed and we need to turn to destructive measures like rent control.

How are (can) datacenters be taxed?

Mind, I don't know, but normally you put in a business, or factory, etc. the state can tax the economic output of the factory.

The factory builds things, sells things, they tax the sales of those things. Local employees get salaries that can be taxed, etc. Of course, property taxes on the land and improvements.

But how does that work with a datacenter?

If I pay $5 for an EC2 instance that happens to be hosted in, say, Virginia, is that a "sale" from the "Virginia Data Center", or is that sale realized somewhere else?

Of course I don't know how that works with, say, a Ford assembly line in Tennessee, with the car sold in California. Does Tennessee get a piece of that Bronco when it leaves the factory, or is it all just internal, corporate money shifting?

As I understand it, the people -> systems ratio is really low. Large datacenter managed by, perhaps, a 1 or 2 dozen people. Most of the "work" is remote, but there needs some hands on to dust the hardware off once a week. But, it's not your typical ratio of people per sq ft of space as other industries.

Just seeing that if you have this datacenter thats "bringing in" lots and lots of dollars, how does the state and local community get their take of that economic activity?

It’s a one year moratorium. I don’t see a problem with this. A lot of voters are concerned about the impacts data centers will have, those concerns are not entirely unwarranted.

We don’t actually have to be moving at breakneck speeds, the AI companies just want you to think we do. A pause to investigate seems warranted.

>The state currently has more than 130 data centers, according to Data Center Map, compared with more than 600 in Virginia and about 500 in Texas.

Texas is physically larger and 'business frienedly' so suspect they will be getting a lot more.

Taylor Sheridan can do a new series where a Ranch owned by a family for many generations is targeted by a Datacentre company.

Don't worry, they'll just build the data centers in NJ and still considered NY 1-20.

Sarcasm aside, I don't really know where they would build data centers in NYS. Electricity rate in northern and western NY is going thru the roof. ADK/Catskill have very sensitive environmental laws. Can't really build in lower hudson as real estate cost would be killer.

Oregon has a 1-year moratorium on new data centers qualifying for the state's Enterprise Zone (EZ) property tax incentive programs (as of June 5, 2026. We shouldn't be giving tax incentives to these Data Centers. But it looks like this NY moratorium goes way beyond that to actually stopping construction.

Some guy floated the idea of putting in a small datacenter in the nearby city and asked for public comment. The next town hall had a huge turnout and multiple people got kicked out for rushing the podium. Meanwhile, people are also protesting and suing to try and stop the nearby solar farm construction. What I'm wondering is why can't we have this level of enthusiasm for actual environmental reform and the transition to clean energy? It almost feels like it is just an anti-progress movement in different clothes.

Data centers in space sounds really stupid until you consider how hard it is to get a data center built on Earth.

I consider myself pretty YIMBY, but the data center build outs are definitely starting to catch my eye.

On one hand I want to stay YIMBY here, my typical problem with arguments against this stuff is that it looks at the resources as finite. We can/should build more power capacity. Water usage concerns already have solutions. The market should be allowed to do its thing.

On the other hand I think there are looming problems with data centers. Energy is the obvious one because its detrimentally affecting residents who had no part or say in someone gobbling up a public resource. And its cheaper to build the centers that don't recycle their water usage, so some legislation is needed there. A moratorium toward those ends makes a lot of sense to me.

I have one other unfinished thought that maybe a wait-and-see mentality is a good thing right now. We might be approaching peak LLM usage, maybe. If we are nearing a bubble burst, I can see how a state's leadership might want to protect its residents however it can, but I don't totally know if a moratorium on this achieves that or just delays the inevitable.

Regardless of your personal feelings about AI, this is pretty clumsy regulation that will just cause Tiebout sorting away from NY. If there are negative externalities, tax 'em, use the proceeds for some feel-good social programming, and let the data center builders internalize the costs...

This just means that DC builds will move to other states. It isn't exactly like you need low latency/colocation for AI workloads.

Instead of blaming the energy supply restrictions those states have imposed, the politicians are now blaming datacenters.

I've been very curious about these, because of course these are measures that are anti-tech in a number of ways (or at least unpopular in the tech circle).

I have trouble understanding why Sanders has decided to be vocal about these, especially as he's been on the right side of the societal debate fence since forever. My guess is that he cares more about what AI is going to do for the common people, and he knows that we need to have this debate early (obviously, technology seems to increase disparity in places like the US). But still I'm not sure he's taking a stab at it in the right way.

For New York state (not city, no Mamdani), it seems like it's a much more pragmatic view: it increases people's costs (energy, water, etc.) and there's too much tax exemption(/evasion) for data centers currently.

A lot of people run production, non-AI servers out of New York data centers. This will be a serious problem for a lot of people, including smaller companies, when they can't expand capacity in New York anymore and prices for what's left start going through the roof. It's not always easy to move servers to other data centers, not everything is an eventually consistent database.

2026 is an election year for the Governor. One year moratorium conveniently allows the incumbent to have cake and eat it too.

I'll say it again. If these data centers are really going to be so profitable, then it should be easy to pay for closed loop cooling, self-built renewable energy and storage, noise and light mitigation, and still pay taxes. Attempts to dodge those is pure greed and people are right to fight back.

We should build more data centers. Provided we extract as a political concession UBI so that the LLMs that run in these places, which are trained on a public corpus and will doubtlessly increasingly eliminate the bargaining power of millions of Americans, do not primarily benefit only their already fabulously wealthy owners.

We can build a better society in which this UBI is scaled as LLMs take over more of the economy. Otherwise, we are clearly headed for more shocks to the American political system as increasingly dubious figures create more phantoms (poor day laborers are "taking your job", China is to blame for American companies taking advantage of "free trade") which will keep tipping towards outright fascism ("enemy of the people", ICE executing people in the streets) to blame for our fundamental societal issues that apparently no one is interested in solving - the societal affects of transformative economic shifts - which no, cannot be stopped or postponed or placed in moratorium indefinitely.

We might as well all push for this now with highly consequential elections approaching over the next 2 - 3 years. Because the insanity will only get worse. We've seen this pattern before. The famous fascists of the 20th century weren't born that way and their path was not inevitable. Many of them actually humorously careened from something more like "far left" communism to fascism as they tried to figure out what would stick in trying to appeal to a world wrought with the consequences of war and economic disruption - delayed affects of the industrial revolution. Don't just try to halt the LLM revolution - you cannot, and you will fail - but be clear about what your demands are.

Moratoriums should have some sense of acceptance criteria or demands. They should not be ways for politicians to simply delay the inevitable because they have no good answers. I think these concerns about power consumption are excuses to deal with the real problems. It's not like energy consumption is thought of as intrinsically bad by the people pushing for these bans. I think LLMs could ultimately be better for society than my neighbor's spotless F-150. It's clear the antagonism to these data centers comes from the inequities around how the gains will be distributed. Ultimately state moratoriums are also ineffective because they will just move to another state, so people in New York will lose in the short term (or benefit - depending on what exactly you object to), but either way we all suffer in the longterm. Make UBI a demand of people running for national office that want your vote.

I have a family member that wants to ban all data centers and I felt like Daniel Plainview in the milkshake scene showing them the AWS region selector interface, explaining that regional data center bans in deep leftist areas won't move the needle.

Nothing short of a totalitarian one world government can stop the development of AI technology, there's simply too much demand. It's just not happening.

These people should make peace with it sooner than later and propose more reasonable terms like mandating AI companies invest in renewable energy.

A moratorium seems excessive when the requirements to make a majority of people happy are pretty clear.

The easy ones are:

1. Use energy and water independent of the municipal grid. 2. Don't build so close to homes that they hear the fans.

A lot of people are rightly concerned about water. That was a big problem with older evaporative cooling systems. But, the newer closed-loops systems being built now are much less worrying.

Water usage concerns can be addressed by doing what https://www.boxelderstratos.com/ did. That's an extremely controversial site because it's 40,000 acres. How could it be so huge? Because that's how much land they had to buy to be a net reduction in water table use compared to the previous owners. It's not a warehouse the size of San Francisco!

A lot of people are rightly concerned about their electricity bill. But, what I'm seeing is that new large datacenters are opting to generate energy on-site using huge amounts of natural gas. That's obviously also very bad because of CO2. But, it doesn't affect your electricity bill nearly as much.

Using the Stratos project as the example again, there's a lot of outrage about how it will "Use 9GW! That's more than double Utah grid capacity all by itself!" But, it's not on the grid. It's starting with 1.5GW of natural gas from a pre-existing pipeline. That's still hugely problematic. Just not in the way the ragebait implies. They claim they are going to build up a mix of gas and solar after launch. But, we'll see how that goes...

If there was regulation requiring them to build up with green energy, regulation with teeth, Stratos would not be nearly so controversial. The water is covered, the energy is off the grid, it's far from any residents, the only concern left is the tremendous amounts of CO2 to be produced. To be clear, Utah already has had several non-datacenter sites producing that much CO2 for a long time now. But, it's not great to add another one.

My point is that if New York put in place a list of reasonable requirements for building and actually enforced them, then a supermajority of residents would be OK with datacenter build-outs. Of course, a minority of folks are so enraged that they want to see all datacenters burned down. But, you can't please everyone.

Small town politics generally fly below the radar but this is a real hot button issue in a growing number of communities. Town meetings are dominated by residents lacking the room for otherwise sleeping zoning hearings that nobody attends. Folks don’t want data centers in their town and they’re increasingly successful in chasing developers out.

Outside the bubble of tech the attitude towards AI and everything associated with it has turned quite negative. It’s hard to see that sitting in silicon valley but venturing out into “the real world” it’s hard to ignore.

What would the advantage be to New Yorkers if they were built here?

I'm sure that their citizens who work as traders and investors on Wall Street will see this, acknowledge that there are serious problems with how data centers are being built in other parts of the country, and stop throwing mountains of money at companies that are participating in such schemes.

</sarcasm>

Finally, we are free from the tyranny of Glonzo.

Here's a view that I've not seen AI/DC proponents engage in (for example, Carmack's recent pro DC post)

AI is an exciting and promising new tech, much like the web/internet in 90s and smartphones in late 2000s. Back in those times, the tech industry was far, far smaller, tiny in the 90s and maybe like 1/20th of the current size in the late 2000s. Tech companies were not a big part of people's every day lives, so these technologies could be seen as something exciting happening off to the side that you didn't need to engage it if you didn't want to.

Today, Big Tech is absolutely ginormous and huge parts of people's lives are mediated by one of a half dozen companies that together form an interlocking set of barely accountable duopolies. It is this overbearing unescapable structure that is causing the backlash, because many people understand intuitively that this exciting new tech will be leveraged against them in every way possible by this structure. We cannot treat AI as neat new thing to play with, experiment with, find novel uses for, we have to put our guard up and defend against Big Tech and DC opposition is a very easy and straightforward way. DC opposition is also highly compatible with existing NIMBY networks and mindsets, which are bipartisan and widespread. Thus

All that is to say is that it's not the technology, it's that bad people are in power and are weilding it to make your life worse in myriad ways - layoffs, increased electricity rates, slop, etc.

These feels like bribe seeking behavior. Pol sees an industry that likely will have a lot of potential market within the pol's jurisdiction, pol publicly puts a speedbump or roadblock in front of the industry causing the industry to start lobbying pol/pol's friends.

A good solution for this is just the AI companies to cut access to this types of areas. After all AI is just bubble that will pop any second. It obviously have no economic values as the tokenmaxxing fiasco showed. I know it is true because NYTimes wrote on the matter.

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