Texas Attorney General, and U.S. Senate candidate, Ken Paxton celebrates with supporters during a primary election night watch party on Tuesday, March 3, 2026, in Dallas.
Smiley N. Pool/Dallas Morning News
Last month, county commissioners in Fayette County, a deeply Republican area between Houston and Austin, approved a resolution opposing the development of data centers after word spread that tech companies were targeting the area.
The push from cities and counties across Texas to slow the flood of data center development comes as Republican leaders are heralding their arrival as another economic boom, putting pressure on Texas Attorney General Ken Paxton to weigh in ahead of his runoff next month with U.S. Sen. John Cornyn.
As the state’s top lawyer, Paxton has been asked to weigh in on whether municipalities have the power to hold up data projects, pitting the Republican between top tech companies and their GOP supporters, including Gov. Greg Abbott and President Donald Trump, and the rural Texans who have long supported him.
Article continues below this ad
In conservative Hood County in North Texas, close to Paxton’s home base, a flood of applications for the construction of data centers has drawn opposition among residents who worry the facilities, which require large volumes of water and electricity and often stretch across thousands of acres, will deplete the region’s water supplies and drive up power prices.
“The concern most people have is this new type of development is going faster than the speed of information coming to the public,” said state Rep. David Cook, a Mansfield Republican. “People are looking for assurances that our water and power supplies are not going to be wiped out here.”
Hood County commissioners narrowly voted down a moratorium on data center construction in February but have, alongside other counties, sought Paxton’s opinion on whether they can take such action. That followed a request from state Sen. Paul Bettencourt, a Houston Republican, for Paxton to uphold state law he says denies municipalities the ability to block data centers.
Paxton declined to comment for this story.
Article continues below this ad
County officials say they need clarity, with Delta County Attorney Edgar Garrett, Jr. writing to Paxton in February that he was unclear whether recent state actions provide counties “with express or implied authority to impose” moratoriums on data center and other development.
“I could see (Paxton) delivering an opinion counties do have the authority to act,” said Brendan Steinhauser, who leads the nonprofit Alliance for Secure AI, which pushes for safeguards on the technology. “It’s hard to predict. He’s trying to win the Senate nomination. He’s got a lot on his plate. But he’s very in tune with the grassroots of his party and I think his team is tracking this issue closely.”
Texas is emerging as one of the leading beneficiaries of the AI boom, with Oracle and OpenAI opting to build in Abilene their first project under Stargate, a $500 billion effort to scale up U.S. data center capacity.
At the same time tech executives including Meta’s Mark Zuckerberg, Palantir’s Joe Lonsdale and OpenAI’s Greg Brockman are pumping millions of dollars into political races across Texas and the nation.
The super PAC Leading the Future, which says it has $100 million in commitments since launching last year, spent more than $750,000 helping billionaire Elon Musk’s attorney, Chris Gobert, win the GOP nomination to replace retiring U.S. Rep. Michael McCaul. And they spent another $500,000 supporting former Justice Department official Jessica Steinmann, who won the GOP primary for retiring U.S. Rep. Marcus Luttrell.
Article continues below this ad
Meta’s Forge the Future super Pac, which is backed by a $50 million investment from the tech giant, reported spending more than $1.3 million on Texas races, including Acting Texas Comptroller Kelly Hancock’s unsuccessful bid to win a full term.Â
And they have found support among politicians like Bettencourt, who led the passage last year of a bill blocking cities from enacting moratoriums on data centers and other large industrial projects.
In an interview, Bettencourt said keeping Texas open to businesses that might prove unpopular with some residents, including multi-family housing and battery factories, was vital to the state’s economic future.
“There is a segment of people that are basically saying they don’t want any more growth,” he said. “What might be very desirable in one county could be perverted into a horrible weapon like we’ve seen other states do, pick California or Illinois or New York.”
Paxton could slowplay any legal opinion on data center moratoriums until later this year, potentially after the general election in November.
Article continues below this ad
In the meantime, local officials are finding other ways to slow development.
Earlier this year, San Marcos City Council voted down a $1.5 billion data center project amid concerns about the project’s impact on the nearby San Marcos River and the region’s power supplies. And in September, College Station City Council rejected a proposed land sale for a data center there.
Such action has gotten the attention of the tech industry, which is witnessing similar blowback in communities across the nation. In Wisconsin, voters in the small city of Port Washington were headed to the polls Tuesday for a referendum on whether voters should get to decide on lucrative tax incentives for data center developers.
“It’s definitely a discussion that the industry is having internally about ‘hey, how do we do a better job of community engagement?’” Dan Diorio of the Data Center Coalition, a trade association that includes big tech firms and developers, told the Associated Press earlier this year.
Article continues below this ad