Op-Ed from Tony Howard: Virginia Should Not Balance Its Budget on One Industry
By Tony Howard, President & CEO, Loudoun Chamber of Commerce
After months of delay, the Virginia General Assembly and Governor Spanberger reached a budget compromise.
Unfortunately, the agreement includes a new $0.011-per-kilowatt-hour tax on data centers, sending a troubling message to one of the Commonwealth’s most important economic sectors and to other employers considering investing in Virginia.
For Loudoun County and Northern Virginia, this issue is real, not just theoretical. Data centers have increased our tax base, supported public services, created jobs, and helped establish our region as a global leader in digital infrastructure.
According to NVTC’s 2026 Data Center Report, data center activity generated nearly $40 billion in statewide economic output, supported more than 112,000 Virginia jobs, and contributed over $1.5 billion annually in state and local taxes.
Those benefits are apparent here in Loudoun, where data center investment supports not only technology jobs but also construction firms, contractors, suppliers, professional services companies, and small businesses across the region.
During a time when Virginia’s revenues were already surpassing official forecasts, policymakers chose to impose a new tax on a single successful industry instead of pursuing broader, more comprehensive tax reform.
That does not mean community concerns should be ignored. Questions about electricity demand, water use, land use, and noise are real and deserve serious attention. But those issues should be handled through transparent, collaborative policymaking — not through a last-minute budget provision that creates uncertainty for employers and investors.
A strong business climate depends on predictability, fairness, and trust. When the Commonwealth changes the rules for one industry, it signals that future investments may also be vulnerable to sudden policy shifts. That message affects more than data centers. It matters to every employer that wants to grow, hire, and invest in Virginia.
Virginia should fulfill its long-term revenue needs through comprehensive tax reform that promotes investment, safeguards employers’ ability to create and maintain jobs, and keeps the Commonwealth competitive.
That is the approach that will strengthen our economy, support our communities, and preserve Virginia’s reputation as one of the best states in America to do business.
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