Texas Lawmakers File Wave Of Data Center Bills From County Zoning Power To Tax Break Repeals

AUSTIN, Texas – Data centers were one of the most common targets on the first day of bill filing for the 2027 Texas legislative session, with Democrats and Republicans in both chambers filing measures that would give counties new power over the projects, end some of their tax breaks or open up deals that keep them secret, according to Texas Legislature Online.

Lawmakers began prefiling bills Monday Nov. 9 for the 90th Texas Legislature, which opens its regular session in January. More than 1,200 bills and resolutions were filed that day, according to the Texas Legislature Online bills by filing date report. At least 16 of them deal directly with data centers or large computing facilities.

County Zoning Power In Rural Areas

Senate Bill 34 by State Sen. Judith Zaffirini of Laredo would let a county commissioners court create special zoning districts for what the bill calls large computational load facilities, including data centers, artificial intelligence operations and cryptocurrency mining that qualify as large electric loads, according to the bill text. The bill would apply only in unincorporated areas of a county, where Texas counties generally do not have zoning power today.

Inside those districts, a county could regulate where a facility goes, setbacks and buffers, noise and lighting, water supply and cooling technology, road impacts, emergency response and other issues, according to the bill text. Counties could require a special use permit, ask for engineering studies and proof of a long-term water supply, require bonds to cover cleanup if a site is abandoned, issue stop-work orders and seek civil penalties of $500 to $10,000 per violation per day.

The bill would not let counties regulate electric rates, power plant permits, transmission line siting or the work of the Public Utility Commission of Texas and ERCOT. Facilities already operating before a county adopts rules could keep operating, but expansions would fall under the new rules. The bill would take effect Sept. 1, 2027.

Zaffirini also filed Senate Bill 36, which would bar cities and counties from signing Chapter 380 and 381 economic development agreements with data centers and would block tax abatements on data center property, according to the bill text.

Gutierrez Proposes A Moratorium And Local Elections

State Sen. Roland Gutierrez, a San Antonio Democrat with a district office in Uvalde, filed Senate Bill 296. According to its caption, the bill deals with the siting, construction, permitting and operation of certain data centers, would require local option elections, would impose a temporary moratorium, would establish annual payments to county residents, would repeal certain tax exemptions and would set civil penalties. The full text of Senate Bill 296 had not been posted online as of Tuesday morning.

Repealing The Sales Tax Break

Several bills would repeal the state sales and use tax exemptions for qualifying data centers and large data center projects. In the Senate, Senate Bill 293 was filed by State Sen. Joan Huffman with coauthors from both parties, including Sens. Alvarado, Ashby, Bettencourt and Campbell, according to the filing report. The bill would also remove data centers from the sales tax exemption for electricity, according to the bill text.

Similar repeal bills were filed in the House by State Reps. Trey Martinez Fischer (HB 167), Carrie Isaac (HB 408), Cody Vasut (HB 681), Jimenez (HB 750) and Vincent Perez (HB 851), according to the filing report.

Secrecy Deals Water Use And Local Approval

• HB 374 by State Rep. Mary González and HB 696 by State Rep. Ochoa would limit agreements that keep governments from releasing information about data center projects.
• HB 529 by State Rep. Salman Bhojani would require water use and wastewater reporting, water resource impact assessments and public notice for data centers.
• HB 706 by State Rep. Ochoa would require an election and public hearing before a city signs certain data center development agreements.
• HB 732 and HB 734 by State Rep. Vincent Perez would make some data centers ineligible for state and local incentives and require public disclosure of local data center deals.
• HB 928 by State Rep. Mizani would require city and county approval before a data center is built.

What Happens Next

The bills will be referred to committees after the session begins in January. For rural and border counties such as Maverick, Val Verde, Zavala, Dimmit and Kinney, Senate Bill 34 and Senate Bill 296 stand out because both would give county governments or local voters a direct say over large data center proposals. The Maverick Times will follow the bills through the session.

Read more: Texas PUC Approves 765 KV Power Line Route Through Val Verde County Despite China Land Concerns

Sources: Senate Bill 34 introduced text | Senate Bill 36 introduced text | Senate Bill 293 introduced text | Senate Bill 296 bill history | Texas Legislature Online bills by filing date report for Nov. 9, 2026

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