New York on Tuesday became the first state to impose a ban on the creation of artificial intelligence data centers.
The announcement reignited an ongoing debate over the establishment of data centers across the country.
President Donald Trump chimed in on the matter in a post on Truth Social. “One of the biggest Driving Forces in the Future for Jobs, are Data Centers. They are big, strong, bold, and Money Machines for the State in which they are built,” he wrote.
The president claimed Hochul pushed the measure for “political reasons” and that AI companies are “being sought in Alabama, Florida, Texas, Arizona, and many other States.”
All of this Income, and other Benefits, will be going to Red States, and some Blue, where Data Centers are sought as Cash Cows, with Lower Taxes and Record Setting Jobs. They must pay for their own Water and Power, and any leftover goes back to the State and local Community. Data Centers are tremendous WINS for the States and Communities that are lucky enough to get them. New York should change its Policy, IMMEDIATELY. The Radical Left Dumocrats must not be allowed to cause us to lose Data Centers, AI, and all of this incredible new Technology, to China, and other countries!
Hochul’s executive order pauses state environmental permits for hyperscale data centers that use 50 megawatts or more of power, according to The New York Times. These are the largest facilities that house thousands of servers necessarily for artificial intelligence and cloud computing. The ban will remain in place for up to one year but allows projects that are already approved to continue.
The reason for the moratorium is to protect New York residents from higher energy costs and to prevent the centers from straining the state’s resources. The Washington Post noted that data centers consume tremendous levels of electricity and water to keep the servers cool and running around the clock.
Trump on Gov. Kathy Hochul's data center moratorium executive order:
— Vaughn Golden (@VaughnEGolden) July 15, 2026
“New York should change its Policy, IMMEDIATELY. The Radical Left Dumocrats must not be allowed to cause us to lose Data Centers, AI, and all of this incredible new Technology, to China, and other countries!” https://t.co/2qT52lrRM8
In her announcement, Hochul explained, “As data center development threatens to hike up utility bills, deplete our natural resources, and create uncertainty for New Yorkers, it’s my responsibility to take action and lead.”
The one-year halt is aimed at giving New York’s government a chance to create new standards and regulations to ensure that AI companies pay their fair share for updates to the grid. In other words, they just want more time to figure out how to involve government in a way that makes everything worse.
This is part of a wider debate over AI data centers that has pitted those who tout data centers for generating jobs and tax revenue. But critics say they use too much power and water while pushing the costs onto everyday Americans.
Industry groups have expressed concerns that long pauses could send investment and jobs to other states that are more welcoming to these projects.