As power-hungry data centers proliferate, states are searching for ways to protect utility customers from the steep costs of upgrading the electrical grid, trying instead to shift the cost to AI-driven tech companies. (Dana DiFilippo/New Jersey Monitor)
A new proposal from a pair of legislative Democrats would institute a number of labor, energy and sustainability requirements on tech companies seeking to build data centers in Wisconsin.
The proposal from Sen. Jodi Habush Sinykin (D-Whitefish Bay) and Rep. Angela Stroud (D-Ashland) comes as data centers have continued to pop up across the state — largely in southeast Wisconsin — sparking heated local debates about land use, local jobs and the centers’ heavy use of water and electricity.
There are now 47 data centers in Wisconsin, with more under consideration by local governments. The data centers house computer servers to store information for cloud-based software and, increasingly, to support the expansion of artificial intelligence.
For local governments, the construction of data centers offers an easy opportunity for property tax revenue from a business that won’t require many local government services. But the servers have high energy and water needs, are often sited on land that has long been used for farming and raise concerns associated with AI. Experts and advocates have been looking for the state government to weigh in more forcefully on how to regulate the centers, the Wisconsin Examiner reported last month.
So far, the only mentions of data centers in state law are a provision in the 2023-25 state budget which exempts data center construction costs from the sales tax and a law enacted earlier this year to study the growth of nuclear power in the state.
The proposal from Habush Sinykin and Stroud, announced Thursday, would establish rules beyond current incentives for data center growth.
“The new legislation being proposed today is about making sure that we have clear, statewide guardrails in place that provide people in communities across Wisconsin with the information and transparency they need to engage in the local decision-making process in an informed, effective manner from the start,” Habush Sinykin, whose district includes a controversial data center project in Port Washington, said in a statement.
Under the proposal, electric companies in the state will be required to submit quarterly reports to the Public Service Commission on the amount of energy being used by data centers in the state. Those reports will be required to include information on the source of the energy and be made public. Water utilities in the state will also be required to publicly report when a single customer will account for more than 25% of the total water usage in the district.
The data center companies would be required to pay an annual fee to the Department of Administration, which will put that money towards renewable energy programs. Data center buildings would also be required to obtain sustainability certifications.
The bill would also give data centers an incentive to encourage utility companies to expand clean energy and it would also require the PSC to establish a class of “very large customers” and ensure that normal ratepayers aren’t bearing the increased energy costs caused by the data centers’ growing energy demands.
“It’s mind-blowing that the only regulations we have on the books are to just incentivize data centers with no expectations for them being good environmental partners with the communities they’re going to be located in,” says Jen Giegerich, the government affairs director at Wisconsin Conservation Voters, which was involved in helping draft the proposal.
“It’s really important that what this bill does is actually make sure that the data centers are paying their own way,” Giegerich continues. “We’ve just seen energy costs rising, and the fact that we would continue to put costs for energy development for tech giants who are making unheard-of profits, and then expecting Wisconsin ratepayers to pay for that is really a problem. So this bill rectifies that, and I think it’s sorely needed.”
The proposal also includes labor requirements for data center construction. Under the bill, any workers at construction sites for data centers must be paid the local prevailing wage rate or, if the worker is a member of a union, the wage rate in that worker’s collective bargaining agreement. The data center company will have to pay whichever wage is higher.
To qualify for the sales tax exemptions already available for data centers under current state law, the companies would be required to meet the labor requirements in the bill and source at least 70% of their energy from renewable sources.
Steve Kwaterski, a spokesperson for the Wisconsin Laborers’ District Council, says data center projects have already been a source of consistent, good paying construction jobs for his members and the bill will go towards ensuring that these jobs support families in the state.
“We want to make sure that any project that’s as complex as a data center is being done with the most skilled and trained workforce that’s out there,” he says. “That ensures that it’s being done right on time, on budget, and done safely as well.”
An empty high school classroom. (Dan Forer | Getty Images)
The Wisconsin Department of Public Instruction (DPI) released its 2025-26 general school aid data this week, showing that 71% of public school districts will receive less general school aid this year, while over $350 million in general aid will be diverted to voucher schools.
Each year DPI is required by state law to release the certified aid figures by Oct. 15. The data for the 2025-26 school year shows that of 421 districts, 111 — or 26% — will receive more aid, while 301 districts — or 71% — will receive less. The numbers replace those from the estimate released in July, which had shown a projected 65% of schools would receive less aid.
DPI noted in a release that the state’s total general aid remained flat this year at $5.58 billion. The Republican-led Legislature decided during the recent state budget process not to provide additional general aid to public school districts.
The distribution of general aid funds is determined by a formula that considers property valuation, student enrollment and shared costs. When school districts lose state aid, they do not lose school revenue authority, meaning many school districts will be left to decide whether to increase local property taxes to make up the difference or make more budget cuts.
Democratic lawmakers, who have repeatedly called for increasing general school aid, blamed their Republican colleagues for the numbers during a virtual press conference Thursday morning.
Sen. Jeff Smith (D-Brunswick) said that data “provided a harsh reality check for school districts that their state Legislature, specifically the Republican-controlled state Legislature, which they have controlled for 30 out of the last 32 years, does not view them as a priority.”
“When Democrats win a majority in the state Senate, our schools will not have to fear this Oct.15 date,” Smith said, adding that Democrats are “committed to investing in the future of Wisconsin children and re-establishing our state as one of the leaders in K-12 education as it once was.”
“This system that our state has been forced to adopt is not sustainable,” Sen. Jodi Habush Sinykin (D- Whitefish Bay) said. In lieu of state funding, school districts in Wisconsin have turned to raising property taxes through referendum, which must be approved by voters, in order to meet their financial obligations, including paying staff salaries, purchasing educational materials and building costs.
After the state budget was signed, some school leaders warned that the trend of relying on property taxes would continue without a state general aid increase.
“Due to the Legislature’s failure to fund our schools, Wisconsin already has one of the highest property tax rates in the country, and if our communities continue to be forced to referendum, those tax rates will continue to rise, making our state even more expensive than it already is. Wisconsin residents are depending on their elected officials to rein in the skyrocketing costs of living in our state,” Habush-Sinykin said. “Yet, the Republican-controlled Legislature has no problem forcing their constituents to suffer under continuously rising property taxes.”
Viroqua School Board President Angie Lawrence said during the press conference that the system is bolstering inequity in Wisconsin schools.
“The school districts and areas of high poverty are generally failing when trying to pass a referendum and the wealthy districts generally are passing their referendum when going to their communities… Is this who we really want to be?” Lawrence asked. “Don’t you think that our tax dollars should be supporting every student equally so that each student has a path to academic excellence, and we shouldn’t have to go to referendum in order to provide a high quality education for our students?”
School voucher programs grow
Alongside funding for public schools, the DPI also released data on the costs of the state’s school voucher programs, which use taxpayer dollars to cover the cost of tuition for students who attend private and charter schools.
The estimated annual cost for the state’s voucher programs in the 2025-26 school year overall is about $700.7 million.
According to the DPI data, $357.5 million will be reduced from general school aid to go towards private voucher schools in 2025-26. This includes $260.9 million for the Wisconsin Parental Choice Program, $44.4 million for the Racine Parental Choice Program and $52.2 million for the Special Needs Scholarship Program.
The rest of the $700.7 million going toward voucher schools will come from the state’s general purpose revenue to fund students in the Milwaukee voucher program as well as for students in the Racine voucher program who enrolled before the 2015-16 school year. The Milwaukee program is estimated to cost $336 million.
Enrollment in all four of the state’s school choice programs rose by 2,349 students in the 2025-26 school year, reaching a high of 60,972 students.
The Milwaukee program grew by 235 students, the Racine program shrank by 14 students, the statewide program grew by 1,814 students and the special needs program grew by 419 students.
Organizations that support school voucher programs had mixed reactions — celebrating the growth, but also cautioning that it was modest compared to previous years.
“Lawmakers in Madison should continue to prioritize protecting these private-school options for all students,” said Carol Shires, vice president of operations for School Choice Wisconsin. “This milestone validates the strong support from Wisconsin’s political leaders for strengthening the financial foundation of parental choice programs.”
School Choice Wisconsin, the largest school choice lobbying group in the state, also noted in its press release that the growth comes as an enrollment cap on the statewide Wisconsin Parental Choice Program is set to expire in the 2026-27 school year.
“[The caps coming off] will allow more families – including those now on waiting lists – to benefit from the nation’s longest-standing program committed to educational freedom,” School Choice Wisconsin said.
Caps on school voucher program participation, which limits the percentage of students in a district who can participate, have been increasing by 1% per year since 2017 and reached 10% of a school district’s enrollment in the 2025-26 school year. When the nation’s first school voucher program launched in Milwaukee in 1990, enrollment was limited to no more than 1% of the Milwaukee Public Schools student population. When the statewide program launched in 2013, enrollment was limited to just 500 students and no more than 1% of a district’s enrollment.
According to the Institute for Reforming Government, a conservative think tank, this year’s numbers represent stable growth for the Milwaukee, special needs and independent charter school programs, but the Wisconsin Parental Choice Program had its lowest growth since 2017-2018.
Quinton Klabon, the organization’s senior research director, urged supporters of school choice to not be complacent.
“Informing parents, expanding high-quality schools, and protecting schools from hostile red tape are high priorities. Otherwise, the baby bust will close choice schools,” Klabon said in a statement.
The total number of schools participating in the statewide program has risen from 403 schools in 2024-25 to 415 schools in 2025-26.
Republicans have introduced some legislation this year to support enrollment in voucher programs. AB 460 from Rep. Cindi Duchow (R-Delafield) would change state law to ensure that siblings of a student who participated in a voucher program would be eligible for enrollment. AB 415, coauthored by Rep. Shae Sortwell (R-Two Rivers) would prohibit DPI from requiring documents to verify a student’s residence unless their residence has changed from a previous verification.
Democratic lawmakers and public education stakeholders expressed concerns about what the school voucher enrollment numbers will mean for the state’s public schools.
“The Academy of Excellence is not excellent,” Lawrence said. “It is not meeting the requirements of high standards of public education, and yet it received over $40 million in tax dollars from the state of Wisconsin [in the 2024-25 school year]… They are funding families that choose to homeschool without the cost of bricks and mortar, or the transparency of how they’re spending the tax dollars they receive. If our state wants to make improvements in education for our students, let’s put our money where our mouth is and spend our tax dollars to improve public education so we can provide the highest academic outcomes for each child.”
The Academy of Excellence is estimated to receive over $50 million in 2025-26 from the state with over 4,000 students enrolled. Those enrollment numbers include students in various voucher programs throughout the state — 808 students from the Milwaukee program, 200 from the Racine program, 3,340 from the statewide program and 63 who are enrolled in the special needs program.
Democratic lawmakers in recent months have introduced an array of bills aimed at limiting voucher school programs and increasing transparency surrounding the costs.
This week Sen. Chris Larson (D-Milwaukee) is circulating draft legislation that would bar virtual schools from being able to participate in the voucher program.
Rep. Christian Phelps (D-Eau Claire) has introduced AB 307, which would eliminate the sunset on the voucher program caps, leaving them at 10% into the future, and AB 496, which would require an annual verification of the income of voucher students’ families. (Currently, there is an income cap to enroll in the programs of 220% for the Wisconsin Parental Choice Program and 300% for the Milwaukee and Racine programs. If a student is continuing in a program or was on a waiting list, they are not required to meet income limits.) Lawmakers have also proposed legislation to disclose voucher costs on property tax bills across the state.
Habush-Sinykin said on the call that the voucher program caps coming off is a “crisis” facing the state’s education system. However, she said advancing bills that would change the state’s trajectory will likely take new leadership in the Senate and Assembly.
“It’s really up to all of us to explain how important it is to have a change in the legislative leadership so that we can have bills… like keeping caps on vouchers, etc., be heard and voted on,” Habush Sinykin said.
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