This article previews a Showcase CLE program at the American Bar Association Business Law Section’s upcoming Fall Meeting in Chicago, Illinois. Register now to attend the program, “Data Centers: Issues of National Infrastructure, State Investment, and Local Sustainability,” on Thursday, September 3, 2026, 12:00–1:30 p.m. CT.
Data centers have gained popular attention in the United States of late, amid an expansion of data center development fueled by the artificial intelligence boom. Many residents and local officials in communities abutting data centers—whether proposed, under construction, or in operation—have risen up in opposition, voicing their concerns about strains on the local electricity grid and depletion of clean water sources, frustration with nuisances such as heat and noise, and skepticism about whether data center projects’ promises of jobs and economic prospects to the community are justified and real.
We depend on data centers every day. When we text, email, and use generative AI tools, the data we transmit and consume fly through various data centers. Data centers use electricity to power the transmission and manipulation of data and typically use water (some use air-based systems) to cool the components and equipment that heat up as they process data. With increasing adoption of AI, data centers’ electricity usage is expected to accelerate. Hence, it would appear that though all of us benefit from data centers from anywhere, the communities hosting the data centers may be asked to shoulder a disproportionate share of the burden and externalities.
That apparent benefit-burden mismatch led me to propose the upcoming Showcase Program on data centers at the ABA Business Law Section Fall Meeting 2026 in Chicago, titled Data Centers: Issue of National Infrastructure, State Investment, and Local Sustainability. Through conversations with the panelists and members of the Section’s Community Economic Development Committee, as well as my own research, the working thesis I have developed is that durable data center development should preserve meaningful self-determination for host communities. A conscientious business lawyer engaged in or wanting to engage in data center development—whether as deal counsel, policy strategist, or community advocate—can help manifest that principle in contracts, processes, and community engagement.
Such an approach is a particularly helpful lodestar today when conversations around data centers have shifted significantly and continue to be in flux. For example, as the world’s largest data center market, northern Virginia remains the mature-market benchmark for the industry, and the state’s retail sales-and-use tax exemption was an important player in that growth. However, in March, a Virginia appellate court affirmed that the rezoning approvals for a major proposal, Prince William Digital Gateway, were void because of defective public notice, resulting in the cancellation of what reportedly would have been the world’s largest data center project. Texas—another incentive-driven market—appeared to respond to the popular opposition when Governor Greg Abbott directed the Public Utility Commission of Texas and the Electric Reliability Council of Texas to audit certain projects and to make available to the public important information about the projects, such as receipt of public financial assistance, power and water demand, and measures to reduce neighborhood impact.
Other questions persist. How will the Trump administration’s energy policy coexist with data center’s increasing demand for power? What will happen to the sprawling data center facilities should we no longer need such large footprints, whether due to technology advances or changes to our data consumption patterns? What will happen if the operator or the tenant leaves, and the facilities stop operation altogether?
The Showcase Program will help attendees to make sense of these developments, participate in the conversation, and leave with practical questions for our professional lives. The panel brings together a leading professor, a data center developer executive immersed in responsible data center development, and lawyers with deep knowledge from transactional, financing, and tax perspectives. We will ask how multifaceted influences and concerns can be aligned to support host-community agency.
During the session, the panelists will explain what data centers are and what they do; examine the legal and political considerations that shape data center development, including tax incentives and financing; and discuss how business lawyers can help catalyze host communities’ meaningful exercise of self-determination. We hope to offer concrete takeaways for lawyers in different roles and generate lively conversations. I hope you will join us.
