Frederick County and local officials push for option to tax data‑center equipment; tech groups warn of uncertainty
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Summary
SB 427 would let counties and Baltimore City create a separate business personal property tax subclass for data centers. Frederick County officials and MACo supported the local‑option tool as a revenue source to offset infrastructure impacts; tech and real‑estate groups warned it could reduce investment or simply become another tax class.
Supporters of SB 427 told the Budget and Taxation Committee they want a locally controlled tool to collect business personal property taxes on data‑center computer equipment, a revenue stream used extensively in Northern Virginia.
Frederick County Executive Jessica Fitzwater described the Quantum Frederick campus project and estimated significant benefits from targeted personal property assessments on data-center equipment. Local officials and association witnesses (Maryland Association of Counties, Frederick County Council members, a local CPA) framed the bill as a local option rather than a mandate, saying counties could choose whether to adopt a special subclass and set rates to capture revenue that helps fund roads, schools, public safety and offset utility and infrastructure costs that accompany large data‑center campuses.
Opponents, including the Maryland Tech Council, cautioned that Maryland’s overall tax and incentive structure differs from Virginia’s and that imposing a new or higher tax could deter projects or simply be absorbed into existing revenue streams. The tech council argued that Frederick’s project has produced large recordation and property-tax revenues without a personal property tax and warned against comparisons that treat single-tax differences in isolation.
Environmental and community advocates urged local authorities to ensure plans account for public-health and environmental externalities; a Cornell study about local impacts of data centers was cited in testimony about disproportionate burdens on disadvantaged communities.
Committee members asked for detail on revenue projections and applicability to existing county tax codes. No formal vote was recorded in the hearing transcript; supporters asked for a favorable report and described anticipated local public hearings and opt‑in processes for any county that chose to use the tool.