Data Centers and Community Benefit Agreements: Balancing Growth and Local Concerns

Experts explain how community benefit agreements can help address public worries about the impact of data centers on electricity rates, water usage, and more.

Jan. 29, 2026 at 6:47pm

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Community benefit agreements (CBAs) are formal contracts that spell out the costs and benefits of data centers for specific communities. They can help address public concerns about the impact of data centers on issues like electricity rates, water usage, noise, and light pollution. Experts argue that CBAs should be transparent, legally binding, and developed collaboratively with host communities to demonstrate reciprocity between data center developers and local residents. Key elements of effective CBAs include direct payments or community funds, tax revenue projections, infrastructure improvements, job creation commitments, and environmental hazard monitoring.

Why it matters

Data centers are crucial to the digital economy, but they have also faced growing community opposition in many areas due to concerns about their impact on local resources and infrastructure. Community benefit agreements can help mitigate these concerns and ensure data centers provide tangible benefits to host communities, rather than just serving the interests of tech companies.

The details

Community benefit agreements should include quantifiable data on the job opportunities, tax revenue, workforce training programs, health and well-being contributions, and other benefits of proposed data centers. They should also address issues like electricity rates, water usage, noise, light pollution, and environmental hazards. Agreements should be transparent, legally binding, and developed collaboratively with host communities. Key elements can include direct payments or community funds, tax revenue projections, infrastructure improvements, job creation commitments, and environmental hazard monitoring.

  • In 2013, the city of Cleveland began using CBAs for a variety of economic development projects.
  • In 2025, officials in northern Indiana announced a $15 billion investment by Amazon to build data centers, with the company committing to creating 1,100 new positions and supporting infrastructure improvements.
  • In 2026, leaders in West Des Moines, Iowa, negotiated an agreement with Microsoft to build several data centers, with the firm relying completely on renewable energy and generating over $2 billion in tax revenues.

The players

Nicol Turner Lee

A senior fellow at the Brookings Institution who has written about the importance of community benefit agreements and digital access for underserved communities.

Darrell West

A vice president at the Brookings Institution who has co-authored research on community benefit agreements for data centers.

Joe Kane

A Brookings colleague who has noted that data centers can require considerable amounts of water, an important consideration in CBAs.

Meta

A technology company that negotiated a CBA with El Paso, Texas, to develop a $1.5 billion data center in return for an 80% abatement of property taxes over 35 years.

Amazon

A technology company that announced plans for a $15 billion investment to build data centers in northern Indiana, committing to creating 1,100 new positions and supporting infrastructure improvements.

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What they’re saying

“We must not let individuals continue to damage private property in San Francisco.”

— Robert Jenkins, San Francisco resident

“Fifty years is such an accomplishment in San Francisco, especially with the way the city has changed over the years.”

— Gordon Edgar, Grocery employee

What’s next

The judge in the case will decide on Tuesday whether or not to allow Walker Reed Quinn out on bail.

The takeaway

This case highlights growing concerns in the community about repeat offenders released on bail, raising questions about bail reform, public safety on SF streets, and if any special laws to govern autonomous vehicles in residential and commercial areas.