Long-term costs of data centers

By the Editorial Team · Monday, October 5, 2026

Elk Grove Village's promotion of data centers as economic drivers faces criticism for offering only short-term construction boosts while creating long-term fiscal and infrastructure burdens on local communities. Critics warn that property tax incentives shift costs to homeowners and that the minimal permanent employment from these facilities undermines their sustained economic benefit.

Elk Grove Village’s recent promotion of data centers as engines of economic growth faces criticism over the long-term impacts these facilities may have on local communities and public finances. In a rebuttal to Mayor Craig B. Johnson’s defense of data center incentives, Donald Guisinger of Strong Towns Oak Forest challenges the economic benefits touted by the mayor, highlighting potential drawbacks that often go unaddressed.

Mayor Johnson has emphasized the significant short-term revenue generated through construction permits, citing $1.2 billion related to data center development. However, Guisinger points out that these construction projects offer only temporary boosts to local economies, as data centers require relatively few permanent employees once operational. The concentration of jobs is largely limited to specialized construction crews brought in from outside the community. This dynamic means the economic activity tends to dissipate after construction, leaving large facilities with minimal ongoing employment impact.

Another focal point of the criticism concerns property tax incentives, specifically Illinois’ Class 6B program. While Mayor Johnson maintains that these incentives do not adversely affect homeowners, Guisinger argues that reducing a data center’s assessed property value does not reduce the overall local tax levy. Instead, the tax burden shifts onto residential property owners, potentially increasing their tax bills for periods ranging from 12 to 24 years. This effect can be exacerbated by the use of tax increment financing (TIF) districts, such as the one established by Elk Grove Village in 2022 for the Vulcan Construction Materials site. TIFs divert new tax revenues to finance project costs, often delaying benefit to schools and municipal services by decades.

Further concerns focus on the operational challenges data centers pose. These facilities, which are heavily reliant on automated technology, do not contribute additional students to local school systems but impose significant, often unseen, pressures on infrastructure. Construction activity leads to increased wear on roads, while ongoing operations demand substantial municipal water for cooling and place heavy loads on electrical grids. Upgrades to accommodate these demands often result in higher costs for residents through utility rates.

Guisinger also notes the legal strategies employed by data center operators, who frequently challenge property tax assessments. These disputes require municipalities to allocate taxpayer funds for defense, adding another layer of fiscal impact.

Overall, the critique underscores a view that subsidizing large, automated facilities with minimal local employment and notable infrastructure strains may not align with the broader goals of sustainable, pro-growth economic policy in the region.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.