Host Towns Are Writing the AI Wealth-Sharing Rules

Senators Elizabeth Warren, Chris Van Hollen, and Richard Blumenthal said on October 9, 2026, that seven of the largest data-center operators still leave households holding grid costs the boom creates. The finding lands in the same week Amazon promised host towns a new community fund, and after states began tying permits to cash, water caps, and take-or-pay power contracts.

Policy shops have spent two years listing royalties, compute credits, windfall taxes, and open models as ways to share AI wealth. The people with leverage are the ones who can stall a substation.

A 27-Page Report on Who Pays the Grid

The senators’ 27-page Power and Profits investigation grew from letters sent on December 15, 2025, to Amazon, Google, Meta, Microsoft, CoreWeave, Digital Realty, and Equinix. Staff then sat with company officials for nearly a year. The report, titled Power and Profits: How the AI Data Center Boom Costs Households and Communities, says the firms’ “fair share” talk covers kit built only for them, not the shared upgrades a new hall forces onto the rest of the system.

In sum, this investigation finds the data center industry is bulldozing local communities and using their economic resources to play states and local communities against one another, creating a race to the bottom in which state and local policymakers feel they have no choice but to accede to the data centers’ demands, and leaving ordinary citizens stuck with the bills.

Sens. Elizabeth Warren, Chris Van Hollen, and Richard Blumenthal, Power and Profits, October 2026

Data centers now use about 5.9 percent of U.S. energy, a share the senators project will reach about 20 percent in 2035. A typical AI hall, they wrote, draws as much power as 100,000 homes. Some sites still being built could match four million homes.

GRID COSTS IN THE SENATORS’ LEDGER

• PJM charges: The report assigns an extra $6.3 billion to ratepayers in 2028 and 2029 across the 13-state mid-Atlantic grid.
• Dominion’s 2025 lines: About three-quarters of a $6.2 billion transmission budget in Virginia is tied to data centers, with nearly 45 percent linked to specific sites and then spread across all customers.
• Rate cases: Investor-owned utilities asked for $18 billion in increases in 2025, the highest level in decades, with data-center demand named as the main driver.
• Cross-border bills: Maryland households face $1.6 billion in transmission costs over the next decade that the report says will mainly serve out-of-state halls.

New Jersey saw a 20 percent utility-bill jump in June 2025 that the senators called data-center driven. Residential bills in Washington, D.C., rose almost 18 percent over the past year. One estimate in the report puts possible cost increases as high as 57 percent in heavy-demand pockets such as Northern Virginia. Between 2022 and 2024, utilities billed ratepayers about $5 billion for more than 150 transmission projects “needed only to connect data centers.”

All four hyperscalers, the senators wrote, still ask utilities, landowners, and sometimes public officials to sign nondisclosure agreements. Meta told them confidentiality “increases efficiency and speed.” The companies also keep hunting sales-tax breaks on chips and gear. In Illinois, 29 of 34 halls that took a jobs-based incentive had created exactly 20 jobs, the threshold, as of December 31, 2025. A Meta project under the name Goldframe LLC showed 50 jobs against $50,000,000 in tax benefits, or $1,000,000 per job.

Amazon Puts $1 Billion on the Table

AWS chief Matt Garman answered the siting revolt on October 2, 2026, with a program called Built Together. Amazon said it will add more than $1 billion over five years on top of what it already spends in data-center counties, aimed at free community college, trades training, energy-bill help, and water projects, with towns picking the mix.

The company says the new pot will connect more than 300,000 students to free degree access and, by the end of 2028, prepare up to 100,000 workers a year. That is a separate figure from the more than $1 billion Amazon says it already put into those communities over the past three years.

Garman also wrote that Amazon “no longer use[s] nondisclosure agreements with the government agencies we work with on our projects.” Land can still move under project code names before a company’s name is public, which is why dropping the government NDA does not, by itself, open the early site hunt.

Amazon’s case on bills and water is the industry’s best version of the story, and it is specific. Direct data-center water use, Garman wrote, is about 0.5 percent of U.S. industrial water, and a typical hall uses about 170,000 gallons a day, with Amazon’s own average under 13,000 gallons, or about 42 households. He said rates have fallen in Indiana and Mississippi even as they rose in Illinois and New York, and that about 70 percent of U.S. power lines are more than 25 years old.

The tax examples are local, and large. Amazon estimates it will pay St. Joseph County, Indiana, more than $3 billion, against $1.2 million from the prior land use over the same term. In Montgomery County, Missouri, it cites more than $1.8 billion over 25 years against about $200,000. A 2026 Mangum Economics paper for the Northern Virginia Technology Council, which Amazon quotes, says the average Loudoun County homeowner would pay an extra $5,800 a year in property tax without data-center revenue.

Jobs sit in the same memo. Madison County, Mississippi (population 116,000) had more than 2,300 people on two Amazon construction sites, with more than 1,700 operating jobs promised. Newton County, Georgia (population 125,000) had more than 1,500 in construction and 400 operating roles. More than 10,000 learners and educators are in Amazon programs across 15 data-center regions. Garman also warned that more than 100 moratoriums are under consideration, which he framed as a gift to rival countries.

Host Towns Already Wrote the Contract

The Federation of American Scientists, in a June 10, 2026, memo by Liza Paudel, treated community benefit agreements for data centers as the tool that matches the speed of the build. The United States already has more than 5,000 facilities. Capital spending hit $400 billion in 2025, with about $1.8 trillion projected from 2024 through 2030. A nationwide poll cited in that memo found 70 percent of Americans oppose a data center nearby, a colder welcome than gas plants, wind farms, or nuclear sites get. Data Center Watch, also cited there, counted $64 billion of projects blocked or delayed by local opposition between May 2024 and March 2025.

Good Jobs First, in figures Paudel uses, found that of 36 states with data-center subsidy programs, only 11 name the companies. Virginia, the densest market, forgoes nearly $1 billion a year in state and local revenue without a public company-by-company list. Finished halls employ 157 permanent workers on average, at $1.4 million to $2.1 million in subsidy per job.

A Brookings paper in January 2026 walked the same ground and named live deals. Lancaster, Pennsylvania, locked a contract with the Lancaster AI Hub before construction closed. Cedar Rapids, Iowa, took annual checks from Google and a larger stream from QTS. Those pacts are small next to hyperscale capex, and they are the first documents that actually move money to the people who live next to the concrete.

WHAT TOWNS HAVE EXTRACTED

Lancaster’s water cap is 20,000 gallons a day per campus, with a 100 percent clean-energy rule and public-records clauses. New York paused state environmental permits for new hyperscale halls on July 14, 2026, then published the $1 million-per-megawatt yardstick, so a 50 megawatt site points to $50 million. Texas ordered a halt on new large-load interconnections on August 3, 2026, until ERCOT finished an audit. California Gov. Gavin Newsom signed seven data-center bills on September 21, 2026, covering rates, water disclosures, labor, and review; most take effect January 1, 2027, including tariffs for halls at or above a peak-demand threshold the state cannot set higher than 25 megawatts.

What a Community Benefits Deal Buys

Paudel’s memo and the Brookings inventory converge on a short list of clauses that change a project, as opposed to a press packet. The deal only bites if the alternative is a delay, a no vote, or a moratorium.

CLAUSES THAT MOVE CASH OR RISK

• Numeric water and noise caps: Lancaster’s 20,000-gallon daily limit and ambient-noise floor are enforceable numbers, not pledges to “steward resources.”
• Penalty ladders: Clean-power misses in Lancaster can cost up to $10 million per building, which is the difference between a promise and a budget line.
• Take-or-pay power: A Congressional Research Service how data centers connect to the grid primer notes that halls still prefer to buy from the local utility, which is why state large-load tariffs, collateral, and exit fees now decide whether households eat the upgrade.
• Open records: Full files on power, water, and tax breaks replace the NDA reflex the senators documented.
• Local hire and training: Apprenticeship seats and first-responder training are the parts of Amazon’s new program that resemble a CBA rather than a donation.

A Rainey Center survey in September 2026 found 71 percent of voters want operators to sign a community benefits agreement before construction, with 12 percent opposed. That is a different question from whether people want the building next door, and both answers now sit on the same dais. Mark Cuban has called for a crowdsourced standard pact; an independent library at Policy Frameworks is already collecting public contracts, including Lancaster’s draft.

Windfall Taxes Sit Behind the Zoning Board

Congress is still arguing about a national skim. Sen. Bernie Sanders has a bill that would take a one-time 50 percent tax in stock from large AI firms and park it in a sovereign wealth fund. Sen. Ruben Gallego of Arizona has floated a 10 percent excise on data centers, plus a “robot” tax aimed at automation layoffs, to fund a higher minimum wage and public jobs. Sen. Mark Kelly of Arizona has proposed a mix of a digital-ad tax, an AI-use tax, and a 50 percent excess-profits tax for a worker-retraining trust. Reps. Greg Casar, Valerie Foushee, and Sara Jacobs filed a bill to tax AI tokens or products.

Warren has separately pushed an excise on the electricity data centers consume, scaled so larger halls pay more, a charge that would sit on the power bill rather than on a corporate return. After the 2025 law that made 100 percent bonus depreciation permanent, she and colleagues wrote the CEOs of Amazon, Meta, Alphabet, and Microsoft asking them to itemize AI and data-center deductions, with answers due October 11, 2026. The Joint Committee on Taxation has estimated that making that depreciation break permanent costs $362.7 billion over ten years.

President Donald Trump, after a White House meeting with tech chiefs on September 29, 2026, said people who live near a data center could be paid a “dividend,” and that teachers might get a bonus. He offered no formula, no agency, and no bill. The House did pass the Ratepayer Protection Act on September 16, 2026, by a 417-3 vote. It tells state regulators to consider rules that make large-load customers cover the extra generation, transmission, and distribution their projects require. “Consider” is the operative verb. It is a floor for dockets, not a check in the mail.

None of those federal ideas pays a water bill in Lancaster this quarter. The bonus-depreciation fight and the electricity excise matter for the Treasury. The permit, the tariff, and the CBA decide whether a county lets the hall turn on.

NSF Just Built a Front Door for Shared Compute

The other catalog item that actually shipped is public compute, and it is built for labs, not for ratepayers. On September 1, 2026, the National Science Foundation awarded the San Diego Supercomputer Center a $35 million NAIRR Operations Center cooperative agreement over five years, with the Texas Advanced Computing Center as partner, to run the National Artificial Intelligence Research Resource. Award number 2616251 funds a portal, user support, and the shift from pilot to standing infrastructure.

Frank Würthwein, SDSC director and the project’s principal investigator, said the center is “an important step toward making advanced AI resources genuinely usable by researchers, educators and students across the country.” The pilot, launched in January 2024, has already connected about 900 research teams and educators in all 50 states over two and a half years. Microsoft had committed $20 million in Azure credits to that pilot. The CREATE AI Act, H.R. 2385, would write the resource into statute and let it take private and federal donations.

That is real access for people who do not sit inside a hyperscaler. It does not cut a residential kilowatt-hour in Loudoun County, and it does not pay a township for a well. Compute credits seed experiments. They do not settle who funds the substation.

Courts have been a third channel, closer to the old “data royalties” idea. In Bartz v. Anthropic, a federal judge in the Northern District of California granted final approval on July 20, 2026, of a $1.5 billion class settlement, about $3,000 per work across roughly 500,000 books, after a split ruling that training could be fair use but keeping pirated files was not. Anthropic’s general counsel said more than 91 percent of covered authors and publishers had claimed a share. The deal does not license future training. It is the largest copyright recovery on the U.S. books, and it still leaves the host county outside the class.

Construction Unions Joined the Operators

The industry’s political answer has been to stand next to the trades. On September 28, 2026, OpenAI, Blackstone, SoftBank, and a group of developers launched the American Infrastructure Alliance with five construction unions and two Ohio labor bodies, aiming at seven states before the 2027 sessions. The platform’s own list is water stewardship, paying for energy and infrastructure, jobs, visible local benefits, and binding oversight. Tag Greason, co-CEO of QTS, said communities should have “transparent commitments regarding resource use, infrastructure investment, economic opportunity, and community benefits.”

Gavin Baker, who runs Atreides Management, put the bull case in public on August 30, 2026: well-structured projects, he wrote, now handle water with closed loops, pay property tax at a scale that can zero out household levies, and pull electricians and HVAC crews into multi-year work. “Where that is happening, utilities are cutting or freezing residential rates and saying so on the record. Where it is not, people are right to object.” Poverty in Quincy, Washington, he wrote, fell from 29 percent to 6 percent after data-center taxes funded a high school, a hospital, a library, and public-safety buildings. That is the argument host towns will hear in every hearing. It is also an admission that the structure of the contract, not the existence of the hall, is what spreads the gain.

THE PERMIT CALENDAR, LATE 2026

1. July 14, 2026: New York pauses state environmental permits for new hyperscale halls for up to a year.
2. August 3, 2026: Texas stops new data-center interconnections pending an ERCOT audit.
3. September 16, 2026: The House passes the Ratepayer Protection Act, 417-3.
4. September 21, 2026: California signs seven data-center bills on rates, water, labor, and review.
5. September 28, 2026: The American Infrastructure Alliance launches with operators and building trades.
6. October 2, 2026: Amazon announces Built Together and drops government NDAs.
7. October 9, 2026: Warren, Van Hollen, and Blumenthal release Power and Profits.

A Congressional Research Service note puts the physical facts under those dates: a hyperscale hall has at least 5,000 servers and 10,000 square feet; about half the electricity runs the computers and about 40 percent runs the cooling; PJM already serves 65 million people. Building the grid still takes years longer than pouring the hall. That gap is why a township vote can move a multi-billion-dollar queue.

The royalty memos and the sovereign-wealth drafts will keep circulating. The next dollar that actually changes hands is in a water cap, a take-or-pay tariff, or a community check that a county can sue to collect.