Midwest states courted data centers for years. Now some are asking who pays.

There is a red barn on land southwest of Ann Arbor, Michigan that lends its name to one of the largest construction projects in state history; the developers naming it "The Barn," potentially in an effort to make it friendlier. The people who live near it may just be calling it something else, and voted down its development last year.

In September last year, the board of Saline Township rejected the rezoning request for the $16 billion data center campus by a four-to-one vote. Just a few days later the developer, Related Digital, sued, alleging exclusionary zoning. By October the township had settled, signing a consent judgment that let the project proceed in exchange for multi-million-dollar community funds. The campus - leased to Oracle and OpenAI as part of the rollout of their Stargate project - is now under construction. OpenAI's Sam Altman turned up to the groundbreaking just last week and called the project a "huge bet," adding “I'm from the Midwest. This is the first data center we will have ever built in the Midwest … that's especially cool to me. This feels like home.”

First, there were the public hearings and the decisions, now there are ads.

The advertising campaign for The Barn answers the three things its neighbors objected to almost line by line. Worried about your water? The TV spot says an advanced cooling system protects it. Worried about your electric bill? Energy costs, it says, are "paid by the project, not local residents." Wondering what the town gets? Millions for schools, parks, and the fire department. The developer's own site repeats the pledge that the project will cover its energy use with no costs passed on to locals, while Oracle says roughly two-thirds of the campus will stay as open space and farmland.

It is interesting to watch an entire industry effectively buying digital billboard space to reassure a community, but it also tells us where the discussion around data centers has now moved to.

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The simple arithmetic of four Midwest states

The Saline standoff isn’t really about The Barn. Across the Midwest, deals struck a decade ago offering generous tax treatment to attract digital infrastructure, are being checked in multiple states all at once.

In Ohio, the reckoning is about the size of the check. Gov. Mike DeWine ordered the state to stop taking new sales- and use-tax exemption requests for data centers while a new Joint Data Center Committee studied the sector. The trigger was cost: local outlets reported the exemptions ran to roughly $1.57 billion last year, far above earlier projections, while Axios reported more than $550 million in 2024. House Speaker Matt Huffman wants to override the governor's veto.  

Meanwhile in Cleveland, the city rejected a permit for a $1.6 billion hyperscale project in Slavic Village on the southern edge of the city, and at least 18 Ohio communities have weighed up or adopted moratoriums.

Illinois is having a similar debate albeit at a slightly slower pace. The POWER Act - which would require data centers to report water use, sign community benefit agreements, and match most of their power with renewables - stalled before the General Assembly's spring adjournment, though sponsors said talks should continue throughout the summer. Separately, supporters want to suspend the tax credits in that state that have allowed them to lure data centers since around 2019. By the state's own 2024 count, at least 27 data centers had drawn an estimated $983 million in lifetime tax breaks. Just this week, Governor JB Pritzker announced he would pause the credits following a letter from a bipartisan group of lawmakers which argued that it makes little sense to keep handing out incentives before ‘guardrails’ even exist.

Wisconsin's version is about secrecy and who pays for the wires. Residents there have learned about multibillion-dollar proposals only after their officials were already bound by nondisclosure agreements. At least eight large projects were proposed or approved in 2025, with Microsoft, Meta, and Vantage among the names. The Public Service Commission approved a first-of-its-kind rate structure for large data centers served by We Energies, after commissioners said ordinary customers shouldn't be left covering the bill - a fix that actually matters because Wisconsin households already carry more than a billion dollars in costs tied to retired power plants. The legislature has not passed a statewide bill, which leaves towns to negotiate them one at a time.

Reading in parallel, it is evident that these four states - and others across the country - are just running variations on the same issue, based on local circumstances. The benefits of these centers in investment, growing a tax base, and construction jobs are genuine and have arrived quickly. The costs though, including power, water and the strain on local planning are more difficult to pin down, long-term, and yet to be felt. Each state is now trying to work out, almost after the horse has already bolted, who absorbs which.

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The argument moves to the airwaves

What's changed is that the industry seems to have started taking local opposition more seriously. Data center developers and tech giants are running what Crain's Detroit Business called a charm offensive to win over communities, and the community funds baked into the Saline settlement are an example of that logic. If the questions raised are about water, bills, and what the town gets, then provide answers about water, bills, and what the town gets.

Altman seems to have grasped the deeper anxiety. In his CNBC interview around the groundbreaking, he admitted that people are "right to be anxious," about AI in general, while also arguing that the industry's failure has been explaining how people stay in control of their own future. He added, from the stage during the ceremony, that “I think I understand something about how the Midwest works and what it takes to have a project go well, but my hope is this can be a … example for the world where the world can benefit incredibly from AI out of a data center like this.”

Elsewhere, these situations are already replicating. Anthropic is the intended user of a proposed data center in Lyon Township, also in Michigan; Google is weighing a one-gigawatt campus in Van Buren Township; the University of Michigan is pushing a supercomputing facility in Ypsilanti over local objections. Nationally, Data Center Watch counts at least $156 billion in projects blocked or delayed by local opposition and litigation last year, demonstrating how his is not only a Midwest story. It is just unusually concentrated here, partially because this is where land, energy, water and political will to build have collided first.

Which leaves the question Wisconsin's communities have been asking all along, and the one The Barn's advertising can't quite reach. Not whether data centers can be built more cleanly - they probably can - but whether a town's "no" is supposed to mean anything when the buyer is the most capitalized industry on earth. The Midwest has spent years competing to attract this kind of infrastructure. It is now competing to govern it, and it does not yet have a shared answer although it feels like it could - and should - collaborate to find one. In any case, the likelihood is that these barns will continue to go up either way.

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