Midterm Voters Back 33 Data Center Restrictions as Goldman Flags Moratorium Risk

Data centers lost badly at the ballot box in Tuesday's midterms. As of 8 a.m. ET Wednesday, voters had approved 33 ballot measures restricting data centers against one allowing them, according to an analysis by Redbud Consulting. Ten states put more than 40 data center questions on local ballots, 21 of them in Ohio, according to Ballotpedia, and the lone pro-development result came in Harwood, North Dakota. In Ashville, Ohio, 82% of about 1,800 voters rejected a resolution that would have let EdgeConneX build two data centers on a 195-acre site.

The opposition showed up in exit polls and in the marquee races. NBC News found that 76% of voters would oppose a new data center in their community, and 56% said AI and data centers were a crucial or major factor in their vote for Congress. Democrat Sherrod Brown flipped an Ohio Senate seat after months of ads calling his opponent "the face of data centers in Ohio," while Democrats Gina Hinojosa in Texas and Keisha Lance Bottoms in Georgia won governor's races after campaigning for data center moratoriums.

That last point is the market risk. Texas and Georgia are two of the largest development hubs in the country, with hundreds of projects planned in each, and Texas hosts the flagship site of OpenAI's Stargate project; Hinojosa promised to immediately pause data center development in the state. Goldman Sachs economists said Democratic state and local wins will likely lead to "short-term data center moratoria, potentially affecting about 45% of planned US data center capacity expansion". Industry money did not change the outcome: the super PAC Building the Future spent $1.5 million backing a South Carolina candidate who lost to a moratorium supporter.

Points to watch are whether the new governors in Texas and Georgia move from campaign pledges to actual pauses, whether states roll back data center tax breaks, and how developers respond. Some already are: environmental groups and Big Tech companies have formed a "Responsible Data Center Development Collaborative" to draft a development framework, and communities are pressing projects to pay taxes, build their own power and cover their electricity and water use.