Willie Nelson slams ‘water thieving’ data centers in Texas

Texas country music legend Willie Nelson has taken to social media to voice his distaste for an AI data center being built near his hometown.

Nelson called on the community in Abbott to fight against a new data center planned there.

What they're saying:

"And now our community, like many others, needs to fight against data centers invading our land," Nelson said on social media. "The last thing we need is a loud, water thieving, light polluting, data center anywhere near our town (or any others for that matter)."

Hill County, where Abbott is located, became the first county in Texas to place a moratorium on data center construction in May, before a lawsuit from the developers caused county commissioners to rescind the moratorium.

Nelson's statement argues that data center development threatens rural living in, not only Abbott, but the rest of Texas.

"The strength of rural America has never come from big industrial footprints," Nelson said. "It comes from generations of people, open spaces, local businesses, and a connection to the land."

Data centers draw opposition from both sides

Big picture view:

Data centers have become the latest flash point in Texas politics, with a majority of Texans saying they oppose the building of data centers in their neighborhoods. Local governments have tried to slow the building process down by attempting to install their own regulations and moratoriums, but most regulations are required to go through the statehouse.

In June, the University of Texas’ Texas Politics Project polled voters about data centers. 

By the numbers:

About 56% of people polled said they opposed construction of data centers in their community. Only 29% supported it.

Even Abbott has seemingly shifted his stance on data centers in recent months.

Earlier this month, Abbott called for a prohibition on building data centers near rural Texas neighborhoods.

What they're saying:

"Pushing back on these AI data centers that are trying to build in our neighborhoods. I’ve made it clear already, any AI data center thinking about coming here, they have to bring their own money, bring their own power, use their own water, and do it in a way that reduces the cost of electricity for residents across our state. We must prohibit them from building AI data centers in rural Texas neighborhoods. We must eliminate the tax break they are getting," he said at a campaign stop earlier this month.

The comments were a seeming about-face from the governor, who last year said Texas would be the "centerpiece for AI data centers."

Texas lawmakers reconsider tax incentives for data centers

Lawmakers met in Austin Monday to discuss changes to the tax breaks being given to data center builders.

A law that took effect in 2014 allows large tax breaks to entice new data centers to Texas. During the first six years after the law passed, only 10 data centers held exempt status.

However, following the pandemic, the state experienced a boom in new facilities. According to the Texas Comptroller's Office, there are now 138 data centers across the state with tax exemptions, and five more applications are pending. That growth accounts for an estimated $3.3 billion in projected tax revenue the state expects to lose.

On Monday morning, a Senate committee held a hearing on data centers to discuss the exemptions, with officials from the comptroller's office testifying first. Although the Texas Legislature does not return to Austin until January, the debate over data centers has frequently surfaced in recent local county and city council meetings.

What they're saying:

Skepticism over the tax breaks and the location of the facilities has emerged from both Democrats and Republicans.

"I voted for it. Most of the people in the legislature at the time did. It passed overwhelmingly. But it has completely changed. It’s a much different animal these days," said Sen. Joan Huffman, a Republican from Houston.

"How do you suggest they should be managed?" asked Sen. Juan "Chuy" Hinojosa, a Democrat from McAllen. "That is something for you and your colleagues to deliberate in the next session to establish some kind of permitting process."

What's next:

Lawmakers are expected to address the tax incentive framework when the Texas Legislature officially returns to Austin in January. Multiple bills are anticipated to make changes to the tax incentive module.