Why Kansas

Kansas and the Infrastructure Opportunity

Growth and investment can be a win-win for Kansas communities and businesses, and the legislature has worked to make sure that is exactly how data center development unfolds in the state. SB 98 is not an unconditional tax giveaway. It is a structured framework with minimum investment thresholds, ratepayer protections, water conservation requirements, and accountability requirements written into state law, ensuring that development happens on a level playing field.

The question for Kansas communities is not whether data centers are good or bad in the abstract. It is whether a specific proposal, on specific terms, works for a specific community. Built Here exists to help people understand the facts so they can answer that question clearly.

The Benefits Are Real

  1. Tax revenue for local governments and schools. Data centers generate property tax revenue that flows directly to local governments and school districts — funding roads, public services and schools for the life of the facility. That revenue recurs year after year, compounding the benefit to communities over time.
  2. Infrastructure investment paid for by developers. The Kansas Corporation Commission's Large Load Power Service tariff (approved November 2025) requires any grid upgrades triggered solely by a data center's power demand to be paid directly by that customer. Those costs do not fall on ratepayers. (KCC, November 2025; Utility Dive, November 2025)
  3. Construction jobs for Kansas's trades workforce. IBEW Local 124's first-year apprentice class grew from 90 in 2021 to approximately 220 in 2026 as data center construction demand drove new electrical workforce development. Kansas City area construction employment grew 9.3% in 2025 — the largest increase of any sector — with data center activity as a primary driver (The Beacon, March 2026).
  4. Long-term economic stability. Data center facilities are capital-intensive, long-lived assets. The investment generates tax revenue, local construction and operations employment, and supply chain activity for the life of the facility, typically measured in decades.

How Kansas Oversees Data Centers

Kansas passed one of the most explicit ratepayer protection frameworks for data center development in the country. The rules are written into state law — not left to developer discretion.
  • Kansas SB 98 (2025) prohibits utilities from offering discounted electricity rates to qualified data centers receiving state tax incentives, ensuring that facilities benefiting from public investment pay full market rate and cannot shift energy costs to residential customers.
  • The Kansas Corporation Commission approved a Large Load Power Service tariff for customers with forecast peak demand of 75 megawatts or greater, requiring those customers to pay their proportional share of any infrastructure upgrades they trigger — those costs do not fall on other ratepayers.
  • Local city and county governments retain full authority over land use decisions through zoning and development approval processes, which include public hearings and community input requirements.
  • The Kansas Department of Health and Environment regulates water use, air quality, and environmental compliance for industrial facilities through a permitting process subject to public review.
  • The Kansas Department of Commerce retains ongoing oversight authority under SB 98, conducting periodic compliance reviews to confirm qualifying firms are meeting their investment, employment, and operational commitments. If a firm is found to have breached the terms of its agreement and fails to remedy the breach, Commerce may require repayment of all or part of the tax exemption received, or terminate the incentive entirely. (Ankura, August 2025; Kansas Commerce on SB 98 Data Center Sales Tax Exemption)

Myth vs. Fact in Kansas

Myth: Data centers will raise Kansans' electricity bills.

Fact: The Kansas Corporation Commission's Large Load Power Service tariff requires data centers and other large electricity users to pay their proportional share of any grid upgrades they trigger, ensuring those costs do not fall on existing customers. (KCC November, 2025) Evergy has stated publicly that its Kansas residential rates rose 5.6% from 2017 to October 2024, compared to 25.7% general inflation over the same period, a stretch that includes significant data center development activity in the region (Evergy Newsroom, January 2025). The state's regulatory framework is designed precisely to prevent data center costs from being shifted to residential customers.

Myth: Communities have no real power to reject a data center proposal.

Fact: Land use decisions in Kansas remain with local governments. City and county councils determine what development is permitted on specific parcels through zoning and approval processes that require public hearings and community input. If a project does not receive local zoning approval, it does not move forward. (K.S.A. 12-757)

Myth: The jobs go to out-of-state workers, not Kansans.

Fact: The construction workforce for data center projects in the Kansas City area is drawing heavily from local trades. IBEW Local 124's apprentice class growth from 90 in 2021 to an expected 220 in 2026, reflecting local workers entering the electrical trades specifically because of data center construction demand. The Beacon's March 2026 reporting confirmed that local labor organizations are actively engaged in securing project labor agreements to ensure Kansas workers fill these positions.

Myth: Data centers bring construction jobs, but nothing permanent.

Fact: Construction is one part of the picture — operations jobs are another. Data center facilities require full-time, permanent staff for the life of the facility: engineers, technicians, security, and operations personnel who live and work in the community long after the building is complete. In Kansas, the data center industry already supports 6,190 direct jobs, according to a 2026 PwC analysis prepared for the Data Center Coalition.

Myth: Tax incentives under SB 98 are not worth the cost.

Fact: SB 98 requires a minimum $250 million investment, plus qualifying jobs — thresholds designed to ensure the public benefit justifies the incentive. The Kansas Corporation Commission's Large Load Power Service tariff independently requires grid service contracts of 12 to 17 years (Kansas SB 98, KCC, November 2025). Data center facilities still pay property taxes, income taxes, and the full range of other state and local taxes. The net fiscal calculation is why the legislature passed SB 98 with bipartisan support.

Myth: It doesn't matter where this gets built — data lives in "the cloud" anyway.

Fact: The cloud is physical. Every email, medical record, and financial transaction lives on a server in a specific building in a specific place. Where that building is determines whose laws govern it and who can access it. When this infrastructure is built here — in Kansas, by Kansas workers — it stays under American law. That is not only good for Kansas’s economy. It is good for the country.

Glossary

Closed-loop cooling system

A cooling system in which the same water circulates continuously through the facility rather than being drawn from and discharged back into local water supplies. After the initial fill, a closed-loop system requires minimal water to maintain — typically a few thousand gallons per year. Most modern data centers use closed-loop or air-cooled systems.

Data center

A building that houses computer servers, networking equipment, and the power and cooling systems that keep them running. Data centers are the physical infrastructure behind digital services — storing files, processing transactions, routing communications, and supporting the systems that hospitals, emergency services, banks, and businesses depend on every day.

Direct job

A permanent position created and employed directly by the data center facility — engineers, technicians, operations staff, and security personnel who work on-site.

Indirect job

A job created in the surrounding economy as a result of a data center's presence — in supply chain businesses, local services, construction trades, and other sectors that support the facility and its workforce.

Incentive / tax exemption

A reduction in a specific category of taxes — typically sales tax on equipment and construction materials — offered by a state or local government to attract qualifying investment. Incentive programs require minimum investment levels and job creation thresholds; facilities still pay property taxes, income taxes, and other local taxes from the first day of operation. In Kansas, SB 98 (2025) requires a minimum capital investment of $250 million and the creation of at least 20 jobs to qualify for a 20-year sales tax exemption.

Large-load customer

A utility customer that consumes electricity at a significantly higher volume than residential or small commercial customers. Data centers are classified as large-load customers in most states. Many states have specific rate structures that require large-load customers to pay their proportional share of any grid infrastructure upgrades they trigger. In Kansas, the Kansas Corporation Commission's Large Load Power Service tariff applies to customers with forecast peak demand of 75 megawatts or more, requiring them to pay their proportional share of infrastructure upgrades — and SB 98 prohibits utilities from offering discounted rates to qualified data centers receiving state tax incentives.

Load growth

An increase in total electricity demand on a utility's grid. Load growth can be driven by population growth, electrification of homes and vehicles, manufacturing expansion, and large-load customers like data centers. Research has found that when load growth is planned for, it can lower per-unit electricity costs by spreading fixed grid costs across more customers.

Development agreement

A legally binding contract between a developer and a government body — typically a state economic development agency or local government — that ties investment commitments, job creation, and community benefits to enforceable milestones and financial penalties for non-compliance.

Ratepayer

A residential or business customer who pays for electricity, water, or other utility services. Ratepayer protection refers to regulatory frameworks that prevent the costs of large-load infrastructure from being passed to ordinary utility customers.

Server

A computer designed to process and store data continuously, running the software that powers websites, applications, databases, and digital communications. Data centers house thousands to hundreds of thousands of servers depending on their size and purpose.

Substation

An electrical facility that steps voltage up or down to move electricity efficiently between the power grid and end users. Data center developers typically fund the construction of dedicated substations as a condition of connecting to the grid, ensuring the cost of grid connection falls on the project rather than on existing customers.