Nebraska Adds Requirements for Data Centers to Qualify for Tax Incentives
On July 20, 2026, Governor Jim Pillen tightened the requirements data centers must meet to qualify for Nebraska tax incentives. Executive Order No. 26-17 (the “Order”)[1] does this in two ways.
First, the Order adds items the State will consider in determining whether to grant tax incentives for data centers. Nebraska has two principal incentive programs: the ImagiNE Nebraska Act, administered by the Department of Economic Development (“DED”), and the Nebraska Advantage Act, administered by the Department of Revenue (“DOR”). The Order affects both programs.
In administering those programs, DED and DOR must specifically consider whether a project advances Nebraska’s long-term economic prosperity. Agencies must weigh factors like job creation and quality, capital investment, business growth and retention, and workforce development. DED must also coordinate with the Department of Water, Environment and Energy (“DWEE”) to evaluate whether a project enhances environmental quality.
Second, the Order directs DWEE to create a Data Center Task Force. The task force will analyze how data centers affect Nebraska’s water resources and environment.
The task force will also review existing state law and recommend legislation to the Legislature in 2027. We have written about existing state regulations for data centers in previous updates.[2] The task force’s recommendations for 2027 must further address how to protect Nebraska’s natural resources and may include county zoning guidelines for future data center development.
Media reports claimed the Order prohibits tax incentives for data centers. But the Order’s text says otherwise. The Order states nothing in it should “be interpreted as discouraging lawful economic development or private investment in Nebraska.” The Order instead layers additional review criteria onto the existing incentive process.
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Baird Holm represents landowners, developers and utilities pursuing complex projects of all kinds in Nebraska. We assist with land use and zoning, state and local permitting, government relations and economic incentives. Please reach out with any questions.
David C. Levy
Hannes D. Zetzsche
Jackson R. Langin, Summer Associate
[1]See Executive Order No. 26-17, Gov. Jim Pillen (Jul. 20, 2026).
[2] See Nebraska Legislature Approves Bills Regulating Energy Storage Resources, Data Centers and Other Large Energy Loads, Dirt Alert (Apr. 14, 2026).
