Loudoun County cuts property taxes using data center revenue

In short: Loudoun County, Virginia is using large tax payments from hundreds of data centers to keep homeowner property taxes unusually low, but resistance to new data centers is growing.

What's going on

Loudoun County has become the world’s biggest hub for data centers, the large buildings that store computers and keep online services running (like warehouses for the internet). It has more than 200 to 250 of these facilities, and a lot of global internet traffic passes through the area.

A big reason the county collects so much money is a local tax on the computer equipment inside data centers. Loudoun’s proposed FY 2026 budget included about $795 million from this equipment tax alone, while other analyses estimate about $685 million for the same period. Some projections say total property taxes tied to data centers could reach about $1.3 billion by 2027, close to half of all property tax collections.

That revenue has helped Loudoun cut its residential property tax rate over time, from about $1.285 per $100 of assessed home value in 2008 to $0.805 today. A think tank estimate said that without data center revenue, the rate might need to rise to about $1.537 per $100. For a home assessed at $800,000, that would mean a jump from about $6,440 a year to about $12,296.

What to watch

Even with lower taxes, many residents are pushing back over noise, power use, and the look and location of new buildings. In March 2025, the county voted 7–2 to end “by-right” data center development, meaning projects in some areas no longer get an automatic green light and must go through public review and approval. Other counties and states are studying Loudoun’s approach, but they may face the same trade-off between lower taxes and local impacts.

Source: NYTimes