Pennsylvania Bill Would Restrict Data-Center Lawsuits Against Towns and Require Community Benefit Agreements

Rep. ) introduced the Local Control Protection Act to restrict companies' ability to sue municipalities for rejecting data center applications. The bill would also require developers to file a legally binding community benefit agreement or lose federal tax incentives, according to legislative text first shared with Axios.

Bresnahan said the measure protects local voices. "We should never let billion-dollar corporations supersede the voices of those who live in the community," he stated. " Public opposition to data centers has grown in several communities.

More than 350,000 people signed a petition opposing a proposed data center bordering the Nashville Zoo. In Seattle, local officials moved to ban new large data centers for one year. Objections cited by residents include alleged environmental damage, high energy usage and resultant utility cost increases, and noise, air and water pollution.

Legislative proposals to restrict data center construction were fairly rare on Capitol Hill before 2026. In the last three months, more than a dozen bills have been introduced in Congress to investigate data centers' impacts or restrict their proliferation. Sen.

) introduced a bill to impose a moratorium on new data center construction until legislation safeguards the public from dangers of artificial intelligence. Several of the proposals also aim to protect consumers from any energy cost spikes that result from data center production. Others examine resource consumption, environmental ramifications and the effects on communities of color.

AI and AI-adjacent companies are spending money through super PACs in the 2026 midterms. Axios reported that Congress has made scant progress in passing guardrails on AI.