The Data Center Restriction Wave Just Jumped to the States

On June 4, 2026, New York's Legislature passed the first statewide data center moratorium in the country and sent it to Gov. Kathy Hochul. She let it sit for six weeks. Then, on July 14, she didn't sign it. She issued her own.

Executive Order No. 62 imposes a temporary statewide pause on new hyperscale data centers while the state writes permanent rules. The Department of Environmental Conservation must hold pending state discretionary permits in abeyance. The order runs "up to one year" with no fixed end date and reaches only data centers drawing 50 megawatts or more. Local permits are explicitly left alone.

The Legislature's bill, the Responsible Data Center Development Act (S.10642/A.11560), had passed the Senate 44–16 and the Assembly 102–39 at a lower threshold: 20 megawatts. Hochul's version, the one that actually took effect, covers a narrower set of projects than the one lawmakers voted for.

The pen moved up a level

The wave we documented three weeks ago lived at the city and the county. San Marcos wrote the use out of its code. Hill County passed a moratorium and rescinded it under a federal lawsuit. Loudoun ended by-right data centers in the densest data center market on earth.

The fight was local, and so was the mitigation: when a city says no, you go one county over.

New York moved the fight up a level. When a state says no, there is no next county over. The whole market freezes at once, and the interconnection queue freezes with it.

As of May 2026, nearly 12 gigawatts of data-center load was sitting in New York's grid queue. More than two-thirds of it was added in 2025 alone.

That queue is the part a parcel-level read misses. A hyperscale project's schedule is built around a grid-interconnection slot, and the slot runs on the utility regulator's clock, not the developer's.

A local moratorium stalls one site. A state pause holds every pending state permit at once. The projects behind them keep aging in a queue that doesn't stop counting.

It doesn't stop one project on one parcel. It stalls the whole pipeline and the schedule that pipeline was built on.

That is the first thing the local frame misses. The second is subtler. New York shows it in a single move: the state layer is not of one mind, and it fights itself.

Hochul didn't take the pen only from the cities. She took it, first, from her own legislature, and narrowed the moratorium in the process.

Whether she formally vetoes the Legislature's broader bill is unresolved as of this writing. Legal analysts expect a veto now that the executive order covers similar ground on her terms, but none has been recorded. Hochul is separately pushing to repeal state and local sales-tax exemptions for large data centers.

"New York will lead the way in creating the strongest standards in the nation for data center development," Hochul said, "ensuring that when companies succeed because of New York, New Yorkers succeed too." The bill's lead Senate sponsor, Kristen Gonzalez, framed the underlying grievance more bluntly: "Technology should improve peoples' lives, not drive up our energy bills or exhaust our natural resources, and increase pollution." Same party, same building, two different thresholds and two different instruments.

Nashville moved the same week, the other way

While New York's governor narrowed a statewide pause, Nashville's Metro Council wrote hard local rules the same week. Its own governor was moving the other way.

On July 21, 2026, the council passed a permanent zoning overhaul and a temporary moratorium, both unanimously. Because Nashville-Davidson is a consolidated city-county government, the rules run countywide.

The zoning package (BL2026-1391 and BL2026-1392) confines large data centers to heavy-industrial zones and bans any data center over 500,000 square feet anywhere in Davidson County. It also imposes a half-mile (2,640-foot) separation from schools, homes, parks, and other sensitive uses. The moratorium (BL2026-1448) pauses new permits through December 1, 2026.

A separate eminent-domain bill targeted the specific parcel an Atlanta developer had just closed on near the Nashville Zoo. It passed second reading 27–3, with five abstentions.

"I'm excited tonight that we have unanimously passed comprehensive and strict restrictions on data centers throughout all of Davidson County," said Councilmember Rollin Horton, who sponsored the zoning package. "This gives us time to do the good work of refining this policy, as I think some of us have some concerns around some environmental things," said Councilmember Courtney Johnston, who sponsored the moratorium.

Tennessee's state government had already moved on the same problem, more narrowly. On May 7, 2026, Gov. Bill Lee signed a bill requiring data centers of 50 megawatts or more to pay for their own grid-infrastructure upgrades and barring utilities from shifting those costs onto other ratepayers.

That is a binding state restriction with teeth, though it stops well short of a moratorium. It also carries a carve-out: a data center can self-generate with its own on-site gas turbines, exempt from state or local review. That limits how far the ratepayer protection reaches.

Then, three days after Nashville's vote, Lee joined 23 Republican governors in signing President Trump's non-binding "Ratepayer Protection Pledge." Under it, hyperscalers say they will build, bring, or buy the energy their facilities need.

The pledge carries no enforcement mechanism. Analysts noted consumer bills could still rise regardless of whether companies honor it.

In one Tennessee summer: a binding cost-shift law with a loophole, a metro ban with real teeth, and a pledge with none. "State-level action" spans that whole distance.

The state layer also quietly caps the local one here. Whether the council's new rules reach the parcel near the zoo turns not on the unanimous vote but on Tennessee's vested-rights law: whether the developer locked in its permits before the ordinance existed.

A state doctrine can blunt a unanimous local vote before it ever binds a single project.

The state cuts both ways

Maine got to "first" before New York and then talked itself out of it. Its Legislature passed LD 307, an 18-month moratorium on data centers of 20 megawatts or more. That was the same threshold New York's Legislature would later use.

Gov. Janet Mills vetoed it on April 24, 2026.

She agreed with the premise. "A moratorium is appropriate given the impacts of massive data centers in other states on the environment and on electricity rates," she wrote. Then she vetoed the bill because it "fails to allow for a specific project in the Town of Jay that enjoys strong local support," a $550 million data center planned for a former paper-mill site.

The House tried to override her on April 29 and failed 72–65. More members voted to override than not. But the tally fell short of the two-thirds required, and the veto stood.

One governor, one project, and a state's first-in-the-nation moratorium never took effect.

West Virginia ran the same power in the opposite direction and stripped its counties of the option entirely. The Power Generation and Consumption Act (HB 2014), signed April 30, 2025, bars counties and municipalities from adopting any ordinance that limits a certified "high-impact data center project." It also lets certified projects self-power off-grid, including from coal.

It is the cleanest one-state mirror of Texas SB 2272. "West Virginia is America's energy state, and this law is going to demonstrate it to the whole country that we are ready for action," Gov. Patrick Morrisey said, citing build times of "24 to 30 months instead of six to eight years."

When the House advanced the implementing rules in February 2026, it did so without adding back local-control or water-protection provisions. A West Virginia county cannot do what Hill County, Texas or Marshall County, Indiana did. The state has taken the choice off the table.

Michigan shows the same governor-versus-legislature split as Maine, decided before a vote. Bipartisan bills (SB 1018–1020, HB 5594–5596) would pause new enterprise data-center approvals through April 1, 2027.

Whitmer's office called a moratorium "an automatic non-starter" before the bills reached a floor vote. Yet more than 20 Michigan townships and cities have already enacted their own local pauses, more than any other state. In Michigan, the restriction wave is local precisely because the state executive is holding it there.

The mechanism varies as much as the direction. Arizona froze the money and left the permits alone. Its June 2026 budget pauses the state's data-center sales-tax exemption for three years, through June 30, 2029.

"Nobody's talking about a moratorium on data centers themselves," Gov. Katie Hobbs said. Illinois did much the same by directive. Gov. JB Pritzker ordered the state's Department of Commerce and Economic Opportunity to pause new agreements under the Data Center Investment Program as of July 1, 2026.

New Jersey went at the ratepayers. Gov. Mikie Sherrill signed a package barring data-center energy costs from being passed to residential customers, which drew the same industry objection heard against San Marcos in the prior piece. Dan Diorio of the Data Center Coalition warned it "risk[s] making New Jersey less predictable."

Construction pause, tax-incentive freeze, ratepayer firewall, county preemption. Four states, four instruments, two opposite directions. "What state is the parcel in" now carries opposite-signed, sometimes-decisive risk.

The states still courting the industry have quietly changed what they offer. West Virginia and Texas put preemption on the table where a subsidy used to sit, barring their own counties from restricting a certified project.

That kind of permission is worth more to a developer than a tax credit, because the local level can't take it back. It's what the courting states are handing out now in place of cash.

How big it actually is

The temptation is to reach for the biggest number. Legislative trackers count more than 300 state data-center bills filed across 30-plus states in a matter of weeks. That figure counts bills introduced, most of which never pass. It says nothing about what states have actually done.

A more conservative count is more useful. The dcmap.us policy tracker, as of its July 2026 update, documents formal state-level actions in 10 states. It restricts itself to council and board votes, enacted ordinances, adopted moratoria, and filed or passed state bills and regulatory rules. Each entry links to a government record or news report.

It also lists items that don't fit the moratorium frame at all: a Florida law affirming local siting authority, a Georgia Public Service Commission cost-allocation rule. Both are a reminder that the state layer includes utility regulators, not just governors and legislatures. Not every state action takes the pen away from cities.

Ten states with recorded action is a smaller number than 300 bills. It is also the number that matters. It counts what a jurisdiction did, not what one of its members proposed.

What the question is now

For years the data center was the frictionless industrial use, and the only question was how to build one. The prior article moved that question down to whether the use was allowed on a given parcel. The last three weeks moved it up again, to which state the parcel sits in, and which way that state's governor and legislature are currently pulling.

That is not a fact a use table can answer. A city's zoning map won't tell you that the state paused the whole use last month, or that it preempted your county's power to restrict it two years ago, or that the governor is one veto away from overriding her own legislature. Site-selection diligence that starts at the parcel and works up will reach the decisive fact last, if at all.

So the read now starts at the top. Before the use table, before the setbacks, before the interconnection study: which state, and which direction is it moving.

A statewide moratorium can freeze a market before a single application is filed. A preemption statute can bar a county from ever saying no. Between the LOI and the closing, the answer can flip. The one fact that now decides whether a data center gets built has left the parcel. It sits in the statehouse. Check the state before you check the site.