The reaction remains mixed one day after New York became the first in the nation to place a moratorium on new hyperscale data centers.

Gov. Kathy Hochul says New York will “lead the way in creating the strongest standards in the nation for data center development,” but critics say this will hurt the Empire State’s bottom line.

“These hyperscale AI data centers consume enormous amounts of power truly threatening to outpace our grid’s capacity and they drive up costs for local ratepayers,” Hochul said at a press conference Tuesday for the signing of the executive order. “I refuse to let those costs be passed on to New Yorkers.”

Mike Elmendorf, president and CEO of the Associated General Contractors of New York State, calls the moratorium a “missed opportunity.”

Elmendorf says, especially in the roll he says data center development can play in helping to revive the state’s struggling construction industry, which he says is still recovering from the COVID-19 pandemic.

He had this to say when asked about the argument that the jobs are short-term.

“That’s how construction works,” said Elmendorf. “You build a building, you build a school, you build a road, you build a bridge those people don’t stay around on the site.”

Elmendorf says data centers are a fast-moving sector and that projects that were considering New York aren’t going to sit around and wait for a year. He says those opportunities are going to go elsewhere.

In a statement to Spectrum News 1, the Data Center Coalition said in part: “Data centers are also creating high-wage jobs for state residents and generating billions in tax revenue that supports schools, transportation, public safety, and other local priorities,” said Dan Diorio, executive vice president of state policy and government affairs for Data Center Coalition. “In New York, data centers supported more than 227,000 jobs, contributed $49 billion to GDP, and generated $5.1 billion in state and local taxes in 2024 — helping make life more affordable for New Yorkers across the state.”

At Tuesday’s press conference, state Sen. Kristen Gonzalez who sponsored the Responsible Data Center Development Act spoke about how the legislation has bipartisan support from both chambers.

“While it’s clear this is a nationwide issue, in New York it’s a unifying one,” she said. “Support for a data center moratorium transcends demographics, political ideologies and geographies. All across the state in towns like north Tonawanda, and Alabama, New York and counties like Rockland and Chautauqua. Upstate and downstate, New Yorkers made their voices heard.”

Hochul has yet to sign the legislation passed by the state legislature.