Governor Joe Lombardo Signs Executive Order Placing Guardrails on Data Center Development, Restoring Education Funding
NEVADA, September 18 - Data Centers Must Pay Local School Support Tax in Full, Bear Costs for Energy, and Protect Water Resources
CARSON CITY, Nev. — Governor Joe Lombardo today signed Executive Order 2026-005 establishing the Nevada Standard for Responsible Data Center Development, a policy framework governing how data centers are developed in Nevada. The policy ensures Nevadans benefit from data center projects by requiring developers to pay the Local School Support Tax in full, cover all project-related costs so they are not passed on to ratepayers, and protects the water supply, electrical grid, and communities where they operate.
The executive order provides guardrails for data center abatement legislation passed in 2015, which required the Governor’s Office of Economic Development (GOED) to grant tax abatements for data centers that met statutory employment, wage, and investment thresholds, with no protections for energy and water use and no flexibility to deny those abatements. In 2025, the Legislature expanded the GOED Board’s authority to deny an application, approve it for a lesser amount, or impose conditions on its approval.
“I promised Nevadans that data centers would be developed responsibly with the community’s interest in mind. Today, we’re delivering on that promise,” said Governor Lombardo. “This executive order establishes a standard that data center developers must follow if they are going to build in Nevada. They must pay their share, protect our water resources, keep costs from being passed on to ratepayers, and protect the communities that host them.”
Under the executive order, data center applications seeking a partial tax abatement cannot be brought before the GOED Board unless the developer agrees to pay the Local School Support Tax in full and executes a binding Community Support Commitment.
“We have a responsibility to make sure our schools have the resources they need to educate Nevada’s children. This executive order puts money back into our schools that otherwise would have been lost under outdated state law. That wasn’t right, and I’m proud to correct it and make certain those dollars reach our classrooms,” continued Governor Lombardo.
Data center applications will not move forward until the developer has executed the Nevada Community Support Commitment, which will be established by the Executive Director of GOED in consultation with the State Engineer, the Public Utilities Commission of Nevada (PUCN), state agencies, local governments, and school districts. At a minimum, data center developers must meet local water standards, cover the cost of serving the facility without passing those costs on to ratepayers, and ensure the project does not strain the electrical grid or community during emergencies.
The executive order also constitutes commitments of the state, including a Responsible Speed to Power Plan identifying the facilities required to serve the large load anticipated through 2036 while ensuring no costs are ever passed on to Nevada ratepayers.
“Data centers can be an unprecedented opportunity for Nevada, but if companies want to build here, they need to play by our rules. This order sets clear expectations while opening the door to billions in responsible investment, good-paying jobs, and long-term economic growth for Nevadans,” concluded Governor Lombardo.
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