Berkeley County asks about data-center tax policy

Berkeley County public officials are inquiring about the tax implications of a potential data-center development in Falling Waters, an unincorporated community on the Potomac River.

Reporting on April 26, Brad McElhinny of WV MetroNews suggested that Berkeley County could be on the leading edge of counties assessing data-center development. McElhinny reported that Berkeley County sent state tax officials a 10-page letter that asks questions about a 2025 state law that spells out how the government divides tax revenues from new data centers.

According to McElhinny, Berkeley County said by letter: “These questions bear directly on the fiscal health of the Berkeley County Commission, Berkeley County’s schools, the integrity of voter-approved bond levies, and the authority of locally elected officials to carry out their constitutional duties.”

As McElhinny’s story suggests, West Virginia is seeing interest in companies developing big warehouses for computer servers that support growing computing demands, including artificial intelligence (AI). Other counties also are likely to have questions.

He said state legislators, in passing the Power Generation and Consumption Act, approved a tax formula that assigns 50% of data-center taxes for a personal income tax reduction fund and 30% to the county or counties where a data center is located. This blog noted last week that the West Virginia Legislature also assigned 5% of the new data-center taxes toward sustaining and strengthening the electric grid, which West Virginia voters support.

It seems data-center investors are seeing the Mountain State as an energy wellspring that will allow them to grow. At the same time, Berkeley County is asking questions about public policy that affects its future.