Common Questions

Who is Louise Lucas and what does she want to do with Virginia data centres?

Louise Lucas is the Chair of Virginia's Senate Finance and Appropriations Committee. She is pushing to end Virginia's sales and use tax exemption on data-centre hardware by the end of 2026, arguing the industry no longer needs the subsidy.Source: Lowdown data-centres update 4

Why did Compass Datacenters leave Virginia?

Compass Datacenters abandoned searches for two sites in Greensville County and Emporia in early 2026 solely because of uncertainty over whether Virginia's data-centre tax exemption would be ended. Finance Secretary Mark Sickles disclosed this to the Senate Finance Committee chaired by Louise Lucas.Source: Lowdown data-centres update 4

What is Virginia's data-centre tax exemption stand-off about?

Virginia offers a sales and use tax exemption on data-centre hardware. Senate Finance chair Louise Lucas wants to end it by 2026; the House wants to extend it to 2035. The standoff has blocked Virginia's entire state budget since early March 2026 and is causing operators to abandon Virginia site searches.Source: Lowdown data-centres update 4

Background

Louise Lucas chairs the Virginia Senate Finance and Appropriations Committee, the most powerful budget position in state government, and has become the dominant legislative force shaping the economics of the world's largest data-centre market. Her Senate bill to end Virginia's data-centre sales and use tax exemption by end-2026 triggered a standoff with the House, which favoured extending it to 2035, blocking the entire state budget from early March 2026. By 22 May, Finance Secretary Mark Sickles disclosed to her committee that Compass Datacenters had walked away from two site searches in Greensville County and Emporia, the first documented project casualty of the impasse.

LUCAS represents Portsmouth and has served in the Virginia Senate since 2003. Her Finance Committee controls the budget process, giving her leverage few individual legislators possess. Her core argument is that Virginia's blanket exemption costs the state hundreds of millions in foregone revenue each year and that an industry generating the world's densest concentration of data-centre capacity no longer needs public subsidy to attract investment.

On 16 June 2026, LUCAS's committee proposed the first US data-centre backup-generator fee: a tiered $35 to $45 per kilowatt levy on installed diesel fallback capacity. The fee would preserve the existing tax exemption while yielding a projected $582 million in FY2027 and $1.2 billion in FY2028. The House cancelled its 18 June budget session with no agreement, and Governor Abigail Spanberger sided with the House against ending the exemption. The Senate is scheduled for 22 June ahead of a 30 June fiscal Deadline that raises the prospect of Virginia's first partial government shutdown. The outcome will influence site-selection decisions across the region and potentially prompt other states to consider similar charges on installed generation capacity.