Compare every proposal on the same time horizon and with the same definitions. The decision should show three linked results: the quality and durability of jobs, net public revenue after incentives and public costs, and the electricity and water burden—including who pays for the infrastructure needed to serve it.
Do not treat a developer’s forecast as an outcome. Put the forecast period, assumptions, project phase, source, and uncertainty beside every projection, then require recurring reports that replace estimates with verified operating data.
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Start with three outcomes, not a single headline number
A data center can promise large investment while creating relatively few permanent jobs, receiving substantial tax relief, and requiring expensive grid or water upgrades. A defensible comparison therefore keeps three ledgers separate but connected.
1. Employment that lasts beyond construction
Count construction and trade work separately from ongoing facility employment. Construction jobs may be numerous but temporary; operating jobs are fewer and continue only while the facility runs. For each category, record headcount, duration, wages, benefits, local hiring, apprenticeships, and the method used to count a position.
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2. Net public fiscal impact
Estimate taxes attributable to the project, then subtract exemptions, negotiated incentives, public services, and infrastructure costs paid by a government or passed to ratepayers. Report gross revenue and net fiscal impact in different lines. Maryland Executive Order 01.01.2026.16 asks for “The net fiscal impact on the State and host jurisdiction after accounting for incentives and public costs” and for commitments that are measurable, time-bound, publicly reported, and periodically reviewed.
3. Resource use and allocation of costs
Show peak and expected annual electricity demand, expected and actual water withdrawal and consumption, the cooling system, timing, and required network upgrades. Identify who pays for new generation, substations, transmission, treatment capacity, pipelines, or emergency supply. Explain how the proposed load could affect existing customers and other water users.
Create one comparison sheet for every proposal
Use an identical worksheet for each applicant. A common structure prevents a proposal with generous job assumptions from being compared with another proposal using stricter accounting.
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| Category | Record for every proposal | Evidence and verification |
|---|---|---|
| Project identity | Site, owner, end user or tenant, facility type, planned capacity, phases, construction start and operation dates | Signed application, site plans, lease or customer commitment where available, permits |
| Construction employment | Trade and construction positions, labor hours, duration, wages, benefits, local share, apprenticeships | Payroll or certified labor reports, contractor records, independent audit |
| Operating employment | Direct permanent jobs by role, shift, wage, benefits, contractor jobs, turnover assumptions | Annual employee and contractor reports, tax or payroll records, verification against commitments |
| Public revenue | Sales, use, property, income, utility and other taxes attributable to the project | Tax model using local rates, assessed values, consumption and timing assumptions |
| Public costs | Exemptions, grants, service expansion, roads, fire and emergency capacity, permitting, enforcement, utility upgrades | Government cost estimates, utility studies, capital schedules and rate-impact analysis |
| Electricity | Contracted demand, peak megawatts, expected annual megawatt-hours, ramp schedule, backup generation | Utility capacity confirmation, interconnection study, interval-meter data after energization |
| Water | Withdrawal and consumptive use, source, cooling method, discharge, seasonal and drought requirements | Water-provider confirmation, permits, meters, monthly withdrawal and consumption reports |
| Accountability | Reporting dates, independent verification, review intervals, remedies, successor obligations | Executed agreement, public reports, audit findings and enforcement records |
Label each entry as committed, contracted, forecast, or observed. A planned 100-megawatt load is not the same as an interconnection contract, and neither is the same as metered use.
Measure jobs without overstating the benefit
Separate temporary and permanent work
Ask the applicant to provide a construction schedule and the number of workers or labor hours by trade and month. A single “jobs created” figure can conceal a short peak during building. Report both peak and average construction employment, total labor hours, project duration, wage rates, benefits, and the portion performed by residents of the host area.
For operations, list full-time-equivalent positions by function, such as facilities, electrical, security, networking, logistics, and administration. State whether a position is an employee or a contractor, whether it is on site or remote, and whether the count is gross headcount or full-time-equivalent employment. Include starting wage, benefits, shift pattern, expected turnover, and the number of jobs expected after each phase.
Make access measurable
“Local hiring” needs a geographic definition, such as a named county or commuting area, and a measurement rule. Require the developer and principal contractors to report local applicants, hires, hours, wages, apprenticeships, and subcontracting. Apprenticeship commitments should identify the program, trade, minimum hours or placements, and completion evidence.
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Use Washington’s measurement warning
Washington State JLARC’s 2026 review of a data-center server and power-infrastructure sales-and-use tax exemption found that reporting rules did not require beneficiaries to describe project work, job duration, wages, or total labor hours. The report also said reported positions had not yet been verified against statutory targets. That is a practical warning: a job count without duration, pay, and verification cannot support a reliable comparison.
In that review, three beneficiaries reported 296 construction and trade jobs across refurbishment projects in 2023 and 2024. They separately reported 53 cumulative family-wage jobs—13 in 2023 and 40 in 2024. Those categories and periods are different; the construction total must not be presented as continuing operations employment.
Calculate gross taxes and net fiscal impact separately
Build the gross-revenue case
Identify every tax that the project could generate and the event that triggers it. Depending on the jurisdiction, this may include sales and use tax on equipment, property tax on buildings and machinery, utility or energy taxes, business taxes, payroll-related taxes, and taxes associated with suppliers. Apply the local rules in effect for the project’s location and phase; do not import another state’s rates or exemptions.
Show the timing of collections. Construction purchases may create a short-lived spike, while property taxes may begin only after assessment and may change as equipment depreciates or exemptions expire. Explain which assumptions are based on a signed tenant or power contract and which are merely intended capacity.
Subtract incentives and public costs
List each exemption, credit, rebate, discounted rate, grant, donated land or service, and tax increment separately. Show its legal authority, duration, eligibility conditions, and estimated value by year. Then add public costs: roads, substations, transmission, water and wastewater expansion, fire and emergency response, permitting, inspections, environmental monitoring, and administration.
Use a transparent formula:
Net fiscal impact = attributable public revenue − tax expenditures − government capital and operating costs − ratepayer-funded costs.
Present a range when assessed value, utilization, power price, tenant occupancy, or construction timing is uncertain. Keep one-time construction revenue apart from recurring annual revenue. If a cost is unknown, label it “not stated” and identify who must supply the estimate; never silently assume it is zero.
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Check commitments, not just projections
Set a baseline year, a reporting schedule, and a review date. A commitment should state the metric, unit, deadline, responsible party, verification method, and remedy. Possible remedies include repayment or clawback of an incentive, a cure period, reduced eligibility for later phases, or termination of an agreement. The remedy must be enforceable under local law and should apply if ownership or a tenant changes.
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Use both peak load and annual energy
Peak demand, measured in megawatts, determines how much generation, transmission, and distribution capacity must be available at one time. Annual consumption, measured in megawatt-hours, drives energy production and many utility costs. Record the expected load factor and the ramp from construction power to each operating phase.
Ask the utility to distinguish announced capacity, reserved or contracted capacity, energized capacity, and interval-metered use. Request the interconnection study, upgrade list, cost allocation, construction schedule, and assumptions about coincident peak. Confirm whether backup generators, batteries, on-site generation, or demand-response arrangements change the utility’s obligations or emissions profile.
Interpret Washington’s electricity estimate correctly
For four eligible centers, Washington State JLARC estimated approximately 427,000 MWh of electricity use in 2024, equal to 1.4% of total electricity sales for the two utilities in its analysis. The estimate relied in part on facility capacity and owner-reported utilization. JLARC noted that data centers were not required to report electricity use, limiting year-over-year comparison of actual use and taxes. These figures describe that Washington program and utilities; they are not a benchmark for another project or region.
Assign upgrade and rate costs
Separate developer-paid interconnection work from network upgrades that the utility recovers through rates. Ask whether existing customers finance any portion, whether the project receives a special tariff, and what happens if the facility’s load is delayed or lower than forecast. Require a phase-gated schedule so later capacity is not built years ahead of a binding tenant or construction milestone.
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Measure water withdrawal, consumption, and risk
Do not combine withdrawal and consumption
Withdrawal is the water taken from a river, aquifer, municipal system, or other source. Consumptive use is the portion not returned to that source in a usable condition, often because it evaporates in cooling. Report both in the same units and time period, with maximum day, monthly, annual, and seasonal values.
Describe the cooling system
Identify cooling towers, air cooling, closed-loop systems, reclaimed water, or other methods; treatment chemicals; discharge temperature and quality; and backup arrangements. State whether the figures are design maximums, expected operation, or meter readings. A proposal should explain how water demand changes with heat, computing intensity, maintenance, and future phases.
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Test availability under stress
Have the water provider confirm source capacity, treatment and conveyance upgrades, connection charges, and the schedule for service. Analyze drought rules, competing users, seasonal restrictions, emergency supply, and the effect on existing customers. Require ongoing public disclosure of withdrawal and consumption, as Maryland Executive Order 01.01.2026.16 directs agencies to develop.
Where alternatives are available, compare their water use and lifecycle cost rather than assuming the least expensive cooling design is the best public option. Put responsibility for conservation equipment, reuse systems, monitoring, and shortage response in the agreement.
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Use a multi-proposal table with identical columns and a common base year. Include at least these axes:
- Permanent local jobs versus temporary construction jobs.
- Wages, benefits, local access, apprenticeships, and contractor employment.
- Gross tax revenue versus net fiscal impact after incentives and public costs.
- Peak megawatts, expected annual megawatt-hours, load ramp, and who pays for capacity.
- Water withdrawal, consumptive use, source, cooling approach, and drought exposure.
- Construction schedule, phases, committed end user, and consequences of delay or cancellation.
- Public reporting, independent verification, review dates, and remedies for missed commitments.
Scorecards can help officials screen options, but do not collapse unlike outcomes into one unexplained total. Show the underlying values and explain any weighting. A project with fewer jobs might still be preferable if it requires less new infrastructure and produces a stronger net fiscal result; that conclusion should be visible in the evidence, not hidden in a formula.
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Identify the end user
Ask who will operate the facility, whether a tenant is committed, and what workloads are expected. Maryland’s order specifically directs local governments to ask about the end user, electricity demand, water needs, energy plan, and timeline. If the tenant is not identified, mark revenue, jobs, and load assumptions as uncertain and condition later phases on stronger evidence.
Model each phase independently
For every phase, state the permit, financing, construction, energization, commissioning, and operating dates. Show what happens if a phase is delayed, reduced, or canceled. Do not count full build-out jobs or tax revenue in the first-phase case unless the agreement makes that build-out binding.
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At each review, replace projections with payroll, tax, meter, and water-provider records. Explain variances instead of silently revising the baseline. Keep the original forecast so officials and residents can see whether assumptions were accurate.
What official examples teach decision-makers
Washington: incentives can be large while measurement is incomplete
JLARC estimated that beneficiaries of the reviewed exemption saved $42.4 million over 2023–26. The report’s scope and the law changed in 2026; its review describes the preference before that change. The same report identified the job-count and electricity-reporting gaps described above. Use the case to demand better definitions and verification, not to predict savings or employment elsewhere.
Virginia: require a return-on-investment account
Virginia’s statutory report for fiscal years 2024 and 2025 requires the state to report the tax benefit and a return-on-investment analysis including direct and indirect jobs and state and local tax revenue. Local officials can use that structure as a checklist, but should consult the report’s detailed figures and current law before quoting any result or assuming the same incentive applies locally.
Delaware: inspect the exact incentive design
The Delaware Division of Research describes incentive designs with thresholds tied to investment, job counts, and wages. Incentives vary by state. Treat those examples as prompts to identify the precise local threshold, duration, reporting duty, and clawback in the proposal—not as evidence that another state’s terms govern your jurisdiction.
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Turn the comparison into enforceable conditions
A development agreement or incentive ordinance should attach the baseline worksheet and define every unit. Include:
- Annual employment reports separating construction, permanent, contractor, local, and apprenticeship work.
- Wage and benefit records, labor hours, duration, and an independent verification process.
- Tax-benefit calculations and a public account of gross revenue, exemptions, and net fiscal impact.
- Electricity reports showing contracted, energized, peak, and metered use, plus upgrade payments.
- Monthly or quarterly water withdrawal and consumption reports, source, cooling method, and shortage response.
- Phase milestones, tenant or end-user changes, successor obligations, and cancellation terms.
- Periodic public review, audit access, cure periods, clawbacks, and other remedies for missed commitments.
Maryland Executive Order 01.01.2026.16 also calls for local guidance on binding employment commitments, reporting, successor obligations, remedies, and periodic review. Its Section J observes that local governments are often the first public bodies approached and bear a project’s most direct consequences. That makes local data access and enforcement terms as important as the initial economic model.
A practical approval workflow
- Define the baseline. Record current employment, tax collections, utility capacity, water demand, rates, and planned public capital projects.
- Issue a standard data request. Require the same fields, units, forecast years, project phases, and evidence from every applicant.
- Validate capacity independently. Ask the electric and water providers to confirm service, upgrades, costs, and schedules rather than accepting developer estimates.
- Build the fiscal model. Calculate gross taxes, list each incentive, add public and ratepayer costs, and show net results by year and scenario.
- Audit job definitions. Separate temporary from permanent work and require wage, duration, local-access, and apprenticeship evidence.
- Stress-test resources. Examine peak load, annual energy, maximum-day water, drought, delays, lower utilization, and tenant changes.
- Negotiate measurable conditions. Tie incentives and later phases to milestones, reporting, verification, and enforceable remedies.
- Publish and revisit. Release the baseline, agreement, annual reports, and variance explanations; schedule formal reviews before each expansion phase.
Common comparison errors and their fixes
- Using one jobs number: split construction, permanent, contractor, local, and apprenticeship measures.
- Calling gross taxes a profit: subtract incentives and public and ratepayer costs.
- Counting planned capacity as actual demand: report contracted, energized, and metered load separately.
- Reporting water intake only: add consumptive use, source, season, cooling method, and drought constraints.
- Quoting another state’s incentive: verify the local statute, threshold, duration, and remedy.
- Accepting unverified forecasts: preserve the original assumptions and replace them with audited observations.
- Ignoring a delayed phase: gate commitments and infrastructure spending to binding milestones.
The decision standard
Approve or support a proposal only when its benefits and burdens can be measured on the same terms as alternatives. The strongest file will show durable, well-paid employment; a positive net fiscal impact after every public cost; and resource demands that the grid and water system can serve without hidden subsidies or unacceptable effects on existing users. Where a value is uncertain, make the uncertainty visible, assign responsibility for obtaining better evidence, and attach a review date and remedy.
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