Wisconsin’s Data Center Controversy: A Political Battle Unfolds
In Wisconsin’s 30th Assembly District, a political battleground has emerged over the issue of data center tax breaks. Democrats are aiming to unseat Republican Assemblyman Shannon Zimmerman, denouncing him as the “architect” behind the tax incentives fueling a surge in data center construction across the state.
Shannon Zimmerman, who has served the district for ten years, faces criticism from his Democratic opponent, Kevin Knoke. Knoke accuses Zimmerman of having a conflict of interest due to his background as an AI executive, potentially benefiting from the very tax breaks he helped authorize.
A recent gathering at Veterans Park in Downtown River Falls saw around 50 members of the grassroots group GROWW voicing their opposition to the tax exemption. The event was marked by speeches and signs reading messages like “No Blank Checks For Big Tech” and “No Deals Behind Closed Doors.”
At the heart of the controversy is Zimmerman’s legislation, which provides tax exemptions for data center equipment and software. According to the Wisconsin Department of Revenue, this measure could result in a $1.6 billion reduction in state revenue.
“AI data centers are not only extracting water, but they’re also extracting wealth from our communities that could be invested into the things that real people need in their lives,” said Bill Hogseth, co-executive director of GROWW, urging support for Knoke.
The tax break proposal gained backing from major players like Microsoft and several utilities, yet faced hurdles in the legislature. Although it secured some Democratic votes, it was instead incorporated into the state budget, signed by Democratic Governor Tony Evers.
Despite the economic growth attributed to the tax breaks, opposition within Wisconsin communities has intensified. Knoke remains focused on key voter concerns such as gas, groceries, and housing costs, while also addressing apprehensions about new data center developments.
“One thing I can tell you right away is, I am not interested in tax giveaways to corporations,” Knoke firmly stated. “They need to pay their fair share.”
Knoke’s claims of Zimmerman’s conflict of interest stem from the latter’s past executive roles in AI firms that could benefit from the legislation. While Knoke stops short of advocating for a data center ban, he emphasizes the need for caution and accountability.
In response, Zimmerman dismissed Knoke’s allegations as politically motivated. “My opponent is losing so he must now invent a narrative to scare voters,” Zimmerman argued, maintaining that the tax exemption is a well-established economic practice for fostering investment in Wisconsin.
Zimmerman’s additional bill, AB840, proposed measures to address concerns related to energy, water, and land usage by data centers. Although it passed the Assembly with minimal Democratic support, it failed to advance in the Senate.
In a move to protect consumers, the Wisconsin Public Service Commission recently adjusted a rate proposal from We Energies to prevent residential customers from bearing the costs of data center infrastructure upgrades.
Amid growing public scrutiny, both Republican and Democratic candidates have been accused of aligning too closely with big tech entities. Whether these criticisms will sway the electorate and help Knoke make history by flipping the long-held Republican seat remains uncertain.
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