The AI gold rush is on, and with it a rush of data center construction across the country that comes with massive tax breaks from state and local governments. At least 36 states do not disclose the recipients of data center incentives, according to a new report from Good Jobs First. Statelines’ Kevin Hardy reports on why transparency is crucial when taxpayer dollars flow to these costly projects:
“Only when governments disclose information on which companies get public money and what they do with it can there be meaningful analysis, greater public participation, and wiser use of public financial resources,” the report says. Good Jobs First specifically examined sales and use tax exemptions that benefit data centers. The study does not account for local property tax abatements, corporate income tax credits and discounts on electricity and water rates.
Louisiana does not disclose which companies benefit from data center subsides:
In Louisiana, tech giant Meta, owner of Facebook and Instagram, is building the largest data center complex in the world. Yet, the public has no insight into how much in sales tax breaks Meta is receiving.
Government shutdown ends
The longest federal government shutdown in U.S. history ended late Wednesday when President Donald Trump signed a government funding bill. The move came after the House advanced a Senate-backed spending measure earlier in the day. The Washington Post’s team reports:
The deal will fund the government through Jan. 30, pass three appropriations bills, reverse more than 4,000 federal layoffs the Trump administration attempted to implement earlier in the shutdown and prevent future layoffs through the end of January. It will appropriate funding for the Supplemental Nutrition Assistance Program, also known as SNAP or food stamps, through September 2026. … It will provide backpay to 650,000 federal workers who have been furloughed since Oct. 1 and an additional 600,000 who have been forced to continue working without pay.
The New York Times’ Karoun Demirjian and Eileen Sullivan report on how long it will take the Supplemental Nutrition Assistance Program, and other federal programs, to return to normal:
Though the Trump administration fought efforts to force them to use contingency funds to pay out benefits under the Supplemental Nutrition Assistance Program, or SNAP, during the shutdown, a spokeswoman for the White House’s budget office insisted this week that beneficiaries will see their accounts fully restored within hours of the federal government reopening.
States, such as Louisiana, that have administered partial SNAP benefits could run into technical issues when administering the remaining amount.
Louisiana’s infrastructure woes
Louisiana continues to suffer from poor infrastructure due to a trifecta of age, extreme weather and inadequate funding. That’s according to a new report from the American Society of Civil Engineers. The Times-Picayune | Baton Rouge Advocate’s David J. Mitchell reports:
The overall “C-” represents a slight improvement from what the society concluded in its 2017 analysis, but the group said the 2025 grade still means “Louisiana’s built environment is not keeping pace,” as infrastructure continues to age and is affected “by limited resources and increasingly frequent severe weather events.” The national average was a “C.” The society noted that the state has experienced 36 extreme weather events over the past decade that resulted in $200 billion in damages statewide.
While Louisiana’s overall infrastructure received a “C-,” the state’s roads and bridges received “D” and “D+” grades, respectively. Funding issues contribute heavily to this dismal score:
But the society pointed out that Louisiana roads and bridges still have a $33 billion maintenance and capital improvement backlog combined, a rising figure affected not only by continuing demands but also by inflated material and other costs over the past several years. … Louisiana highways and bridges rely on a 20-cent-per-gallon state sales tax that has lost two-thirds of its purchasing power since it was last raised in the late 1980s. The state road tax has seen total revenues decline due to greater gasoline engine efficiency and electric vehicles.
Don’t use TANF funds to plug budget holes
The Temporary Assistance for Needy Families (TANF) block grant provides states with federal dollars that are supposed to be used, in large part, to provide basic cash assistance for low-income families with children. But far too often states divert these dollars to other, unrelated priorities. A new blog from the Center on Budget and Policy Priorities explains why some states, such as Kentucky and South Dakota, are being tempted to use TANF dollars to plug budget holes:
Fiscal pressures on states have been growing in recent years, often because of state-enacted tax cuts. This pressure is predicted to get worse due to the harmful Republican megabill drastically cutting food assistance through SNAP and health coverage through Medicaid. The cost implications of the megabill will intensify over the next two to three years, creating enormous pressure for states to fill in gaps of support that many families with low incomes depend on to meet basic needs.
CBPP’s team explains why this is a bad idea:
Cutting a vital income source like TANF makes it harder for families to meet their children’s basic needs — such as food, housing, and medical care — which are often the factors considered in child neglect cases. … With fewer resources, families are forced to make impossible choices: paying the rent or buying groceries, buying their kids’ school supplies, or keeping the lights on. Cuts to already low TANF benefits deepen hardship and undermine parents’ ability to care for their children at home.
Number of the Day
265,000 to 365,000 – Projected number of seasonal positions companies will add from October through December 2025, the lowest amount since the Great Recession. (Source: National Retail Federation via the Washington Post)