Tighter data center rules: Three governors moved on data centers in a single week, and one told his environmental agency to stop issuing permits altogether.
Georgia foster care audit: A $7.3 million software system meant to speed up foster placements ended up factoring into a $71.1 million cost increase.
Texas border reimbursement: Texas is getting $7.5 billion back from the federal government for border security it paid for on its own, a first for the state.
Washington income tax: You could owe Washington's new income tax without ever setting foot in the state.
Your turn: What should The Center Square investigate next? Scroll to the bottom of this issue and cast your vote in this week’s poll.
Texas, Virginia, and Nevada tighten data center rules
Photo: İsmail Enes Ayhan / Unsplash / Edited in Canva
What we found: Governors in three states moved within a week to change what data centers pay and what help they get from their states. Texas Gov. Greg Abbott, a Republican, ordered the state environmental agency to stop issuing data center permits until grid and water audits are done, his fourth directive in four months. Virginia Gov. Abigail Spanberger, a Democrat, barred the state's economic development arm from steering new projects that expect to draw at least 25 megawatts into site and permitting programs, and barred executive agencies from signing nondisclosure agreements that hide details about proposed data centers. Nevada Gov. Joe Lombardo, a Republican, ordered new applicants for data center tax breaks to pay into a local school support tax.
The stakes: These orders turn on who covers the power lines, water, and grid upgrades the industry needs. Abbott said data center projects must cover all electrical infrastructure costs and lower residential electricity bills. Spanberger's framework asks utilities to shift more transmission and generation costs onto data centers and other large users.
The backstory: Texas and Nevada lawmakers created these tax breaks roughly a decade ago. Nevada's abatements have been worth an estimated $461 million to data center companies, according to a Nevada Independent report. Virginia operators reported $1.9 billion in tax benefits in fiscal 2025, up from $1.3 billion a year earlier, in self-reported figures the state did not independently verify.
Where it stands: The Texas environmental agency owes Abbott a compliance update by Oct. 19, and lawmakers in all three states are expected to take up the rest in 2027.
3 States
Georgia: The Department of Family and Children Services spent $7.3 million on software to manage foster care placements, and a state audit released last week found the system factored into a $71.1 million increase in service authorization costs. Spending on those services rose from $63.3 million in fiscal 2022 to $134.4 million in fiscal 2025. The audit said central office staff reported case managers approving services "just in case" they were needed. The department told The Center Square it now uses the system in a limited capacity.
Texas: The U.S. Department of Homeland Security approved $7.5 billion in reimbursements to Texas for border security costs the state covered during the Biden administration, the first reimbursement of its kind. The money comes from a State Border Security Reinforcement Fund that U.S. Sen. John Cornyn, R-Texas, secured in the One Big Beautiful Bill Act. Texas lawmakers allocated more than $11.6 billion to border security during those years, the most in state history. Abbott said the state is also applying to the U.S. Department of Justice for part of another $3 billion.
Washington: People who have never set foot in Washington could owe the state's new income tax if a repeal effort fails, according to a scenario presented Monday to the state's income tax advisory group. The Multistate Tax Commission described a nonresident partner in a New York limited liability company that invests in a Washington company generating income there. That partner could have to file a Washington return. Brian Mahon, a tax partner who addressed the group, said keeping the capital gains tax separate creates complexity that could push some individuals past an effective rate of 9.9%.
2 Issues
Elections: A federal appeals court ordered Missouri on Monday to use the congressional map lawmakers passed in 2025 for the November midterms, a map the U.S. Supreme Court had halted. The 8th U.S. Circuit Court of Appeals said the Constitution does not permit the state to use a different map in November than it used in the Aug. 4 primary, noting 1.4 million residents live in different districts under the two maps. The 2025 map is expected to give Republicans an additional seat, and the case is expected to return to the Supreme Court.
Artificial intelligence: Two governors pressed Congress in the past week to regulate artificial intelligence. Virginia Gov. Abigail Spanberger wrote congressional leaders Tuesday, asking for federal rules on workforce displacement, data privacy and the resources the technology consumes. Pennsylvania Gov. Josh Shapiro used a Pittsburgh speech last Thursday to call for independent third-party oversight of frontier models and faulted Congress for leaving on a seven-week recess. President Donald Trump reiterated his opposition to new AI rules Tuesday in remarks to the United Nations General Assembly.
1 Number
$620 million
That is what Illinois projects it will spend on homelessness across 15 state agencies in fiscal 2027. State Sen. Li Arellano, R-Dixon, a member of the Interagency Task Force on Homelessness, told The Center Square he would rather change economic policy to prevent homelessness than spend more directly on homelessness services.
Why Congress hasn't budgeted on time since 1996.
The States covers Trump's $1 billion cut to U.S. funding for the United Nations, then turns to Congress, where The Center Square's Therese Boudreaux reports lawmakers have not passed all 12 appropriations bills on time since 1996. Convention of States co-founder Mark Meckler says federal budget transparency is effectively zero next to what states disclose.
Los Angeles Mayor Karen Bass
A three-part investigation by The Center Square found gaps in how $38 million in donations Bass requested were disclosed and overseen. Bass did not always disclose donors' pending city business. Companies paying city lobbyists gave millions through a gap in her lobbying restrictions. At least 23 "Anonymous" donations totaled $240,563 in 12 days. Bass, who faces Councilwoman Nithya Raman in November, did not respond to requests for comment.
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