Nevada governor limits tax breaks for data centers

Opponents of data centers are reacting to Nevada’s Republican Gov. Joe Lombardo's executive order to limit tax incentives for them.

The executive order did not go far enough, according to Attorney General Aaron Ford, the Democrat running against Lombardo for governor in the Nov. 3 election, and groups opposed to data centers. The order, which ties data center development to an education fund, received mixed reactions from education groups.

“We have a responsibility to make sure our schools have the resources they need to educate Nevada’s children,” Lombardo said in announcing the executive order on Friday. “This executive order puts money back into our schools that otherwise would have been lost under outdated state law. That wasn’t right, and I’m proud to correct it and make certain those dollars reach our classrooms.”

The data center industry has grown over the past decade in Nevada to 76 current and planned projects, according to the Data Center Map organization. In 2015, the state Legislature passed a law that created sales, use and property tax abatements for data centers that met certain standards for jobs and investment in the state.

Advocates critical of data centers in Nevada have called the 2015 requirements to receive the tax abatements too loose, with some criticizing any tax incentives for the industry. In 2025, new legislation gave the state more ability to deny data centers the tax abatements.

“Our position would be that Nevada shouldn't be subsidizing an enormously profitable industry,” Alexander Marks, spokesperson for the Nevada State Education Association, a local chapter of a teacher’s labor union, told The Center Square. “The tax abatements are real money.”

Over the last decade, the tax abatements have been worth an estimated $461 million to data center companies, according to a Nevada Independent report. Local school support tax breaks were worth an estimated $236 million.

Lombardo’s executive order would require new data center tax break applicants to pay into a Local School Support Tax. Nevada has historically ranked low nationally for public education and is currently listed as 45th lowest by a 2026 Wallet Hub report.

John Vellardita, executive director of the Clark County Education Association, a teachers’ union for the county that encompasses Las Vegas, said the new education funds from the executive order could be massive for the state public schools.

“This is an opportunity,” Vellardita told The Center Square. “If this industry was paying its LSST, the amount of money would be very, very consequential. I mean, in 2015 they got a break, and for the last eleven years this industry has had a break.”

Vellardita and the CCEA supported the executive order, but said the move needed help from further legislation in the next legislative session in 2027.

The NSEA and Attorney General Ford have, on the other hand, argued Lombardo’s executive order does not go far enough on peeling back data center tax breaks.

Ford said he would pause data center tax breaks if he were elected governor. As a former state senator, Ford sponsored the 2015 data center tax abatement legislation.

Marks said he was wary of tying the state’s education funds to the data center industry. “What happens if the data center boom doesn’t last?” he asked.

The executive order comes in the final weeks leading up to a competitive Nevada governor’s race that has caught national attention. Data centers have taken an increasingly central role in the campaign, with Ford releasing his own data center plan last month, with both candidates criticizing each other’s voting record on the issue through ads.