New federal tax breaks for rural US projects and Amazon’s NDA policy change show how data centre siting is being reshaped by both incentives and backlash.
A pair of developments published over the past two days suggest that where US data centres get built is becoming as much a policy question as an engineering one. WIRED reported that a change taking effect on 1 January will make projects in designated rural tracts eligible for expanded opportunity zone tax benefits under the One Big Beautiful Bill Act. Separately, TechCrunch reported that Amazon Web Services chief executive Matt Garman said the company no longer uses nondisclosure agreements, or NDAs, with government agencies as it seeks approval for new data centres.
These are different kinds of change, but they meet at the same point: operators are trying to secure land, power and permits for large computing facilities, while communities and lawmakers are asking harder questions about what those projects bring in return. For IT and business leaders, that matters because the physical build-out behind cloud and AI services is no longer just about technical capacity. It is also about tax treatment, local approval and public trust.
What the new rural tax break changes
According to WIRED’s account of the policy change, the One Big Beautiful Bill Act expanded the opportunity zone programme so that, from next year, projects in designated rural opportunity-zone tracts can newly qualify for specific corporate tax benefits.
Opportunity zones are areas designated for tax incentives intended to attract private investment. In plain terms, the programme gives companies a financial reason to put projects in selected lower-income areas. WIRED said Jason Smith, chair of the House Ways and Means Committee, argued last year that the new rules may lower barriers for large, capital-intensive projects in rural areas, including hyperscale data centres. Hyperscale facilities are the very large data centres used by major cloud and internet companies.
The immediate question is how many projects could qualify. WIRED said research by the Searchlight Institute, which it reviewed exclusively, identified more than 100 data centres in various stages of development in rural areas that could be eligible. The same report added an important caveat: Searchlight used a conservative database with fewer than 700 planned or under-construction projects, while other datasets put the number of US data centres in development nearer 1,500. So the number of potentially eligible sites could be higher, but the source does not establish a final count.
WIRED also cited separate research from Pew saying that 13 percent of operating data centres are in rural areas, while about 67 percent of planned facilities are going rural. That does not show that the tax change caused the shift, but it does suggest the new incentive arrives at a moment when rural siting is already becoming more common.
Why operators may care, and why some are cautious
The attraction is straightforward. Data centres are expensive to build, and tax benefits can improve the economics of land-heavy infrastructure projects. WIRED noted that companies do not automatically receive the opportunity zone benefits just because a project sits in a qualifying rural tract. They must also create a specialised investment vehicle, and because use of the tax break can be treated as confidential IRS data, it is difficult to tell which companies are pursuing it unless they disclose that voluntarily.
That uncertainty runs through the story. WIRED contacted Meta, Amazon, Microsoft and Google about projects in areas that could qualify. Microsoft, Meta and Amazon denied using the programme, while Google did not respond, according to the report. Amazon told WIRED it does not actively seek land in opportunity zones and has not claimed the benefit for its projects. Microsoft said it does not use the programme to invest in the purchase or construction of its data centres.
At the same time, WIRED reported that Nathan Jensen, a professor at the University of Texas at Austin, said he would be “very surprised” if some companies were not considering rural opportunity zones in their siting decisions. That distinction matters. The reporting supports the idea that the incentive could shape decisions for some builders, especially lower-profile developers, but it does not support a blanket claim that major operators are rushing to use it.
The bigger business issue is whether the public return matches the tax support. WIRED said the only requirement for the benefits is capital investment, not job creation. That matters because a data centre can create substantial construction work at first, but the article says there is ongoing debate over whether these facilities create a lasting local workforce in the longer term. The source also notes that the government estimates the expansion of the opportunity zone programme to rural areas will cost $40.9 billion over the next decade.
For organisations that depend on cloud capacity, this does not yet mean a visible change in service. But it does suggest future capacity may increasingly be tied to rural locations where land is cheaper and incentives are stronger, provided projects can still secure power and local approval.
Why transparency has become part of the build process
The second development is less about tax and more about trust. TechCrunch reported that AWS chief executive Matt Garman said Amazon has stopped using NDAs in its dealings with government agencies when seeking approval to build data centres.
An NDA, or nondisclosure agreement, is a contract that restricts what parties can publicly discuss. In this context, critics have argued that such agreements can prevent communities from learning about large infrastructure projects until late in the approval process. TechCrunch said NDAs have become a significant part of broader opposition to data centre projects, citing complaints that plans are announced only after permits are secured and that local officials signed confidentiality agreements before residents knew a project was under consideration.
Amazon’s announcement came as part of a broader defence of data centres. TechCrunch said Garman tried to rebut criticism on water use, electricity prices, pollution and community benefit. Some of those claims were contested within the same report. For example, TechCrunch noted that Amazon’s and Nvidia’s statements on direct water use do not account for wider water demand linked to electricity generation and chip manufacturing, and that scientists have said they need independent study because there are no federal or state requirements on how tech companies report this data.
On electricity costs, TechCrunch reported that Garman argued rates have risen in some states with many data centres but fallen or grown more slowly in others, and that where prices are increasing it is mainly because grids were not expanded before demand arrived. The same article also cited an independent watchdog that recently said data centres were the main cause of a 76 percent year-over-year price increase on the largest US electrical grid. That means the evidence in the source points to an active dispute, not a settled conclusion.
What is clearer is that public opposition is influencing policy. TechCrunch said New York has announced a one-year moratorium on permits for large data centres, and that Garman said more than 100 data centre moratoriums are being considered across the US. The article attributes that figure to Garman, so it should be read as his claim rather than an independently established count.
What the two shifts say about data center expansion
Taken together, the reporting suggests that data centre growth in the US is no longer just a question of technical demand. It is also being shaped by tax structure, local permitting and public trust. The strongest conclusion supported by these reports is not that rural siting will automatically accelerate, but that developers now have clearer incentives to consider it while facing more pressure to explain those projects openly.
For businesses and IT teams, the practical message is not that data centre growth is either simply slowing or simply accelerating. Infrastructure planning is becoming more conditional. Operators that can make the economics work in designated rural opportunity-zone tracts may find new incentives available from January. But the same projects could still run into resistance if local officials and residents feel decisions are being made without transparency or if the economic case for the community looks thin.
The sources also show that company responses are not uniform. Amazon is publicly changing one part of its approval process by ending NDAs with government agencies, while telling WIRED it has not used opportunity zone benefits for site selection. Microsoft likewise said it does not use the programme. WIRED suggests smaller or less visible developers may be more likely to pursue the tax break, but the available reporting does not establish how widespread that is yet.
What matters next is who actually uses the expanded opportunity-zone rules, and whether transparency changes like Amazon’s NDA decision alter local resistance in practice. If more builders pursue rural tax benefits without showing clear community gains, the backlash described in both reports could intensify rather than fade. If they do not use the programme at scale, the policy may still matter as a sign of how governments are trying to steer data centre growth geographically while communities push for more say over how that growth happens.