(HB1601)

GOVERNOR'S VETO

Pursuant to Article V, Section 6 of the Constitution of Virginia, I veto House Bill 1601, which would mandate new requirements for local governments when reviewing land use applications for high energy use facilities.

This bill limits local discretion and creates unnecessary red tape. While well-intentioned, the legislation imposes a one-size-fits-all approach on communities that are best positioned to make their own decisions. Data centers represent an immense opportunity for localities around the Commonwealth, especially those that don't already have them. For FY23, data centers provided $733 M, of tax revenue, 31% of total tax revenue for Loudoun County. According to the Joint Legislative Audit and Review Commission (JLARC) data center report, in FY 23, capital investment in Virginia's data centers exceeded $24 billion.

An independent economic impact analysis of Virginia's data center industry conducted for the JLARC study, estimates that it provides approximately 74,000 jobs, $5.5 billion in labor income, and $9.1 billion to GDP annually. Virginia is the data center capital of the world, and we should not enact legislation to allow other states to pass us by nor to restrict local government from developing data centers based on their community's specific circumstances.

This year, I signed into law legislation that directed the State Corporation Commission to determine whether Dominion Energy and Appalachian Power are using rates, tolls, charges, or schedules that reasonably classify utility customers. Dominion Energy in their biennial rate case filed this year proposed a new rate class for high load factor customers, including data centers, in order to ensure that costs associated with servicing such customers are properly allocated.

My proposed amendments preserved the spirit of the bill while allowing localities flexibility. The General Assembly's rejection of those amendments leaves behind a rigid framework that could chill investment and hinder economic development.

Accordingly, I veto this bill.