by Kathleen James (D-Manchester Center) On May 28, Governor Scott vetoed H.727, an important bill that would have protected Vermonters from the negative financial and environmental impacts of future large-scale AI data centers.
On May 29, the last day of the legislative session, the House attempted a veto override. The roll-call vote had the support of every Democrat, Independent and Progressive legislator on the floor. But the Republicans all opposed, and the 83-52 count fell short of the two-thirds threshold needed to override.
The clock ran out. The final gavel fell. The 2025–2026 biennium ended. And the misguided veto stands.
H.727 received overwhelming support from legislators of all parties throughout the five-month legislative session. But Republicans flipped their votes after the Governor laid down the 62nd veto of his ten-year tenure. (It’s getting hard to keep track: In the all-time Vermont veto list, Governor Howard Dean runs a very distant second, with 21 vetoes over 12 years.)
Americans for Prosperity, a right-wing, dark-money organization founded by the Koch Brothers and funded by Big Oil and Big Tech, applauded the Governor’s veto in a press release. “Data centers are not a threat,” the press release said. Many Vermonters disagree.
Across the country, Americans are fighting the rapid proliferation of massive data centers. That’s because they’re driving up electric bills, draining water supplies, and paving over fields and forests. Fueled by AI, cloud servers and a big push from President Trump — with an escalating need for ever-more computing power — a typical data center is about as big as two football fields. The so-called “hyperscale” data centers are up to 1 million square feet. That’s 17 football fields.
Data centers consume a lot of power, which means they can raise the cost of electricity for ratepayers. They also consume huge amounts of water for cooling — a typical data center can suck up 300,000 gallons per day — and damage the environment in other ways: through air pollution, noise pollution or forever-chemical “PFAS” discharge.
The legislature is sometimes accused of kicking the can down the road. Not this time. In H.727, we laid out a surefire, proactive way to ensure strict regulatory parameters around any prospective data center of 20 MW or bigger. That’s the size of a typical big-box store, which means we need to get ahead of this and not wait. And despite what you might have heard, H.727 regulated data centers, and data centers alone.
H.727 guaranteed that any data center would go through the full Act 250 permitting process, no matter where it’s located. Among other things, the Act 250 criteria analyze impacts on air and water quality, water supplies, waste disposal, flood hazards, soil stability, habitat protection, transportation, local schools and services, municipal expenses, historic resources, aesthetics and noise, primary agricultural soils, forest fragmentation, energy conservation, impacts of growth, and consistency with municipal and regional plans. Our approach to this was specific and targeted: We closed any possible loophole by adding the definition of “data center” to the list of Act 250 triggers. That’s a new and important step.
H.727 also required that any large-scale data center sign a 10-year contract with its utility. The contract, reviewed by the Public Utility Commission, would have guaranteed that electric ratepayers would not be hammered with higher bills but instead would actually benefit. H.727 also would have maximized the construction of renewable power on site. And it included an annual payment the utility would use to help Vermonters — especially those who live near a data center — reduce fossil fuel use and save money on their energy bills.
When H.727 left our committee and won near-unanimous House support in March, it was a strong bill. The Senate made it even stronger. The Senate version passed 26-3 on May 15, garnered near-unanimous support again in the House on May 20, and was sent to the Governor for consideration on May 22. We know the result.
H.727 would have ensured rigorous and comprehensive review for any large-scale data center that might set its sights on Vermont. It protected ratepayers, protected communities and protected our air, land and water.
In his May 28 veto letter, Governor Scott raised a concern about the “broader message” that H.727 might send. His veto sent an even broader message to Vermonters: When it comes to large-scale data centers, regulatory protection apparently can wait. Do you agree?
Kathleen James (D-Bennington 4) is chair of the House Energy and Digital Infrastructure Committee.
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