Nebraska ends tax incentives for new data centers and launches resource-impact review
Gov. Jim Pillen has ended access to ImagiNE Nebraska Act tax incentives for new data-center projects and ordered a state review of the industry’s demands on water, land and electricity.
Pillen signed the executive order July 20. The governor’s office announced it July 21. Under the order, the state may not approve new applications for ImagiNE Nebraska Act tax credits for data-center projects.
Contemporaneous reporting said the policy applies to all new data-center projects, rather than only the largest facilities. The action is a state executive decision, not a City of Lincoln action.
What the order changes
The ImagiNE Nebraska Act has been a source of tax incentives for qualifying projects. The executive order removes that option for new data-center tax-credit applications, changing the terms facing future projects seeking to develop in Nebraska.
The order was presented amid both economic opportunity and resource demands associated with a rapidly expanding data-center industry. Its announcement identified water, land and electricity as resources that require review.
The available sources do not establish how the order will affect projects whose incentives were already approved or applications already filed. They also do not establish the status of any specific project’s tax agreements.
State task force directed to assess resources
The order directs the Nebraska Department of Water, Energy and Environment to create a task force. The task force is to recommend ways Nebraska can protect its water and electricity resources as data-center development expands.
No timetable or membership list for the task force was specified in the available state announcement. Its recommendations are the next known step described in the order.
Lincoln development remains relevant
Lincoln is home to an active Google data-center project. Google has said it aims to place the facility in service later in 2026, according to Nebraska Public Media. Earlier reporting described the project as a $600 million development expected to create at least 30 full-time jobs.
The executive order does not state that the Lincoln project has been canceled, nor do the available sources show whether it has lost any incentive. Those questions depend on the project’s specific agreements and application status, which were not established in the source material.
Google also provided $300,000 to Lincoln Electric System for affordable-housing energy improvements, according to Nebraska Public Media. That contribution is separate from the state’s decision on future ImagiNE tax-credit applications.
For Lincoln, the state policy change places continuing data-center development alongside a broader review of infrastructure and resource planning. The immediate confirmed change is limited to new applications for the state tax credits; the task force’s recommendations have not yet been specified.
Sources
- Gov. Pillen Signs Executive Order on Data Centers, Office of Governor Jim Pillen
- Pillen rescinds ImagiNE Act tax incentives for new Nebraska data centers, Nebraska Examiner
- LES receives $300,000 from Google to provide affordable housing energy improvements, Nebraska Public Media