Data centers near O'Hare score nearly $100M in tax breaks

Key Points:

• More than a dozen data centers near Chicago’s O’Hare Airport are receiving tens of millions in local property tax breaks, shifting tax burdens onto suburban homeowners, particularly in northwest suburbs like Northlake, Elk Grove Village, and Franklin Park.
• These tax breaks include multimillion-dollar valuation reductions approved by Cook County officials and special state tax incentives, collectively reducing taxable property values by nearly $2 billion and translating to almost $100 million in tax savings for data center owners.
• The valuation of data centers is highly contested, with Cook County Assessor Fritz Kaegi challenging low appraisals that exclude major building systems, arguing these facilities are historically undervalued and that their true market value includes expensive infrastructure essential to operations.
• Local governments face challenges balancing the economic benefits of data centers with public backlash over environmental concerns and rising homeowner tax bills, while data center operators argue tax breaks are necessary to remain competitive amid other states offering more favorable incentives.
• Cook County is considering reforms to its tax incentive programs amid calls from advocacy groups for moratoriums on new data center construction and incentives, aiming to better regulate the rapidly growing industry and protect local tax revenues and community services.