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Amid Data Center Growth, County Council Eyes Tax Break Pause

As data center projects to power AI are on the rise and with a local power transmission line project proposed, the Luzerne County Council in Pennsylvania may consider a moratorium on tax relief plans.

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(TNS) — Luzerne County Council may consider a moratorium on property tax relief plans on land south of Talen Energy’s nuclear power plant in response to a PPL transmission line proposed to run through the Sugarloaf Valley and the growth of data centers that power artificial intelligence.

During council’s work session on Tuesday, council members also discussed whether to suspend tax breaks already approved south of the plant in Salem Twp. Sugarloaf Twp. resident John Zola, a leader of the Alliance to Stop the Line group opposing the new transmission line, proposed the moratorium and suspension of tax breaks south of the plant.

Councilman Harry Haas added the discussion on property tax breaks and the transmission line to Tuesday’s work session agenda. Haas plans to propose measures for the Aug. 26 meeting, including a vote on a proposal to establish nonbinding guidelines for negotiating property tax breaks.

“We’ve got to meet some kind of middle ground that protects people’s quality of life, that secures it for our grandkids’ future, that preserves Luzerne County, which is a very unique place,” Haas said. “And you’re probably sick of me telling you about this, but I don’t want to be the Lehigh Valley. I don’t think most of you want to be the Lehigh Valley here.”

Council removed the proposal to establish tax break guidelines from its voting agenda on June 10. The proposed guidelines would be for property tax breaks through the Local Economic Revitalization Tax Assistance Act. Under LERTA, a property tax break can be granted for up to 10 years on the added assessed value of new development on deteriorated areas.

PPL Corp. plans to invest $6.8 billion through 2028 to expand grid capacity and modernize transmission across multiple Pennsylvania counties to support the growing power demand of data centers needed to power artificial intelligence.

In southern Luzerne County, PPL Electric Utilities plans to use an existing right-of-way corridor to build a 12-mile high-voltage transmission line, along with two new switchyards. The transmission line would cut through multiple municipalities, including Sugarloaf Twp., Nescopeck Twp., Black Creek Twp. and Hazle Twp.

“What they have is they have a century-old right of way that’s too small for this project. That is why they’re using the threat of eminent domain,” Zola said.

Construction is expected to start next year, and the project is expected to be done in 2027. The project is currently in a planning and design phase, which includes widening the existing right-of-way and engineering work, and PPL plans to seek approval from the Pennsylvania Public Utilities Commission later this year after the design phase is completed.

In March, council approved a LERTA property tax break for 10 years on 472 acres by the west side of Interstate 81 near Humboldt Industrial Park in Hazle Twp. for a planned data center. That data center would use power from new PPL transmission line, Zola said.

“Those factories and those data centers are using that power, and there’s no way ifs, ands or buts about it,” Zola said. “And if they’re saying they’re not, have them put it in writing, because it’s a lie. It’s a bold face lie.”

Councilman Jimmy Sabatino asked Solicitor Harry Skene if council could suspend a LERTA tax break already approved.

“Not without getting sued,” Skene replied.

Amazon has proposed a data center in Salem Twp. to tap into the Talen Energy nuclear power plant. A proposed state Senate bill would fast track permitting for data centers in Pennsylvania while placing limits on local zoning to maintain uniformity across towns.

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