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SB 25-280

Data Center Development & Grid Modernization Act

2025 Regular Session Introduced by Kyle Brown and 5 co-sponsors

SB 25-280 aimed to boost Colorado's economy by offering 100% tax exemptions for data centers investing $250M and creating 25 jobs, but it failed to pass.

Senate Committee on Appropriations Lay Over Unamended - Amendment(s) Failed
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WeVote Research Nonpartisan
Bill Summary · SB 25-280

Summary of SB 25-280: Data Center Development & Grid Modernization Act

Overview

Senate Bill 25-280, titled the Data Center Development & Grid Modernization Act, was introduced on April 4, 2025. The bill aimed to create incentives for data center development while supporting electric grid infrastructure in Colorado. However, the bill was deemed lost in the Senate Appropriations Committee on May 8, 2025, and did not advance.

Purpose and Intent

The primary intent of SB 25-280 was to facilitate efficient data center development through a structured incentive program. The bill sought to enhance Colorado's technological infrastructure, promote economic growth, and ensure sustainable energy practices by providing tax exemptions and utility benefits to certified data center projects.

Key Provisions

1. Data Center Development Incentive Program

  • Established within the Office of Economic Development and International Trade (OEDIT).
  • Collaborates with the Public Utilities Commission (PUC), Colorado Energy Office (CEO), and Department of Natural Resources (DNR).

2. Sales and Use Tax Exemption

  • A 100% sales and use tax exemption for qualified purchases related to data center infrastructure, effective from tax year 2026.
  • The exemption lasts for 20 years from the date of certification.

3. Certification Requirements

  • Data center operators must apply for certification and demonstrate:
    • A minimum investment of $250 million in construction and equipment within five years.
    • Creation of 25 full-time jobs with compensation at least 110% of the county average.
    • Implementation of sustainability measures and grid support capabilities.
    • Conducting a preliminary consultation with the utility providing electricity.

4. Reporting and Compliance

  • Certified operators must submit annual compliance reports detailing tax exemptions claimed.
  • OEDIT has the authority to revoke certifications if compliance is not maintained.

5. Utility Benefits

  • Certified projects can receive economic development utility benefits for the duration of the tax exemption.
  • Potential for a 10-year extension of benefits if additional investments and job creation are achieved.

6. Fee Structure

  • OEDIT can charge fees for certification applications, capped at $10,000 for applications and $20,000 for certifications.

Fiscal Impact

The fiscal note indicated significant financial implications:
- State Revenue: Projected reductions in revenue due to tax exemptions, estimated at -$2,610,000 for FY 2025-26.
- State Expenditures: Required an appropriation of $736,889 for multiple state agencies for FY 2025-26.
- Job Creation: Expected to create approximately 4.6 FTE positions in state agencies.

Affected Parties

The bill would have impacted:
- Data center operators seeking to establish new facilities in Colorado.
- Local governments benefiting from increased economic activity and job creation.
- State agencies involved in the administration and oversight of the program.

Procedural Aspects

  • The bill was referred to the Senate Committee on Transportation & Energy and subsequently to the Senate Committee on Appropriations.
  • Amendments were proposed but ultimately failed, leading to the bill's loss in committee.

Conclusion

While SB 25-280 aimed to position Colorado as a leader in data center development and grid modernization, its failure to advance highlights the complexities and challenges of legislative processes surrounding economic incentives and infrastructure development.

Compiled from official sources — confirm details with the bill’s official record.

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