Governor Mike Braun Signs Data Center Incentive Law

Governor Mike Braun signed House Bill 1210 into law on March 12, 2026, creating financial incentives for Indiana cities and counties that approve new data center projects. The legislation follows an effort to ensure local governments receive compensation for the infrastructure demands of these facilities.

The final law significantly reduced incentive levels compared to earlier Senate versions following private meetings between lawmakers and industry lobbyists. While the Senate had endorsed payments of at least 1% of total electricity costs and equipment purchases, the final version limits electricity-based payments to no more than one penny of the 7% sales tax exemption established in 2019. Under these terms, a data center with a $500 million annual electric bill would pay a maximum of $350,000 to local government rather than a minimum of $5 million.

Industry advocates and critics offered opposing views on the reduction. The Data Center Coalition argued that higher mandated payments would damage the state's competitiveness. Conversely, the Citizens Action Coalition described the final incentives as toothless. To further evaluate the industry's footprint, the state ordered a study through House Bill 1406 to examine the environmental, utility, and fiscal impacts of data center tax incentives, with a report due by November 1.