What Hochul’s moratorium means for Western New York data center projects
July 15th, 2026
Reported by Matt Glynn on July 15, 2026 Read on Buffalo News.
Gov. Kathy Hochul’s one-year moratorium on data center development statewide will have sweeping implications across Western New York.
The executive order she signed Tuesday puts up a stop sign – at least temporarily – for a $2 billion project identified for the former Tonawanda Coke site and a data center talked about for the Town of Portland in Chautauqua County.
The impact on Stream’s proposed $19.5 billion complex in Genesee County was less clear. A Stream representative said the company was reviewing the executive order and did not provide a comment.
The moratorium does not affect TeraWulf’s Lake Mariner project in Niagara County, according to the company.
“Lake Mariner is already operational, and our expansion supporting Fluidstack and Google is fully permitted,” said Kerri Langlais, TeraWulf’s chief strategy officer. “In many respects, the executive order further underscores the strategic value of existing, power-secured, development-ready infrastructure.”
The company has spent has spent millions of dollars to equip its data center in the Town of Somerset. TeraWulf hasn’t paid sales tax on those purchases, citing an exemption stemming from a law passed in the early 2000s.
Niagara County is considering filing a lawsuit to collect sales taxes it believes it is owed. Hochul on Tuesday said she is pursuing legislation to repeal that sales tax exemption for “massive” data centers.
The moratorium also contains an exemption for data centers for educational purposes, so it does not affect the University at Buffalo’s plans for a supercomputing center on its North Campus to support the state’s Empire AI initiative.
Hochul signed the executive order amid backlash to data centers in a number of communities. Opponents have raised fears about the projects’ impact on land use, utility bills, water consumption, and the environment.
The governor, in a statement, echoed those concerns.
“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,” she said. “New York will lead the way in creating the strongest standards in the nation for data center development, ensuring that when companies succeed because of New York, New Yorkers succeed too.”
The moratorium – the first such statewide action across the nation – applies to projects that haven’t already obtained the necessary environmental permits to move forward. Projects that have completed their environmental permitting can proceed, unaffected by the moratorium.
In the Town of Tonawanda, developers Jon Williams and John Yensan had unveiled a plan for a 495,000-square-foot data center at the former Tonawanda Coke site, a project valued at $2 billion.
But in June, the developers asked the town’s planning board to pause its review process. The developer said it was still waiting for specifics on the availability of electricity required to power the data center and on any needed upgrades to the site’s infrastructure. Even with the pause, opponents spoke out against the project at a planning board meeting.
Aides to Gov. Kathy Hochul said she wanted the pause to allow the state to establish a framework to protect the environment, electrical grid and utility ratepayers.
Williams on Tuesday said the items identified in Hochul’s executive order “are the same items that need to be considered before siting any industrial complex, whether a data center, an automobile factory or a refrigerator warehouse for yogurt.
“I hope the executive order is designed to allow New York state to develop a qualitative process by which the state and local communities can evaluate the benefits of a project against its actual impacts, and not simply a reaction to vocal opposition against one specific industry that is more political than factual,” Williams said.
The Town of Tonawanda had been considering a six-month moratorium on data center development before Hochul announced her executive order, said Town Supervisor John Flynn. “Obviously, (Tuesday’s) news changes all that,” he said.
“The bottom line is that there’s going to be a year moratorium now, which I think is good,” Flynn said. “I think it gives us time now for the state, who really needs to be the leader on this, to do a statewide study on how these data centers affect the electric grid.”
In Genesee County, Dallas-based Stream has proposed a complex spanning 2.2 million square feet – equivalent to about 22 Home Depot stores – in the Science, Technology and Advanced Manufacturing Park, or STAMP.
The project would use 500 megawatts of electricity. Critics have raised concerns about the environmental impact, as well as the potential for the Genesee County Economic Development Center to award $1.4 billion in tax breaks, in exchange for just 125 jobs – a subsidy that equals more than $11 million for each job that would be created.
Stream has said its project would provide high-paying jobs and generate an estimated $550 million over 30 years in new new tax revenues and direct payments to local municipalities and schools, which the community can use to make other investments to support future economic development.
Stream officials have also said they are striving to minimize the project’s physical and noise impact on its surroundings.
Genesee County Economic Development Center officials did not provide a comment on Tuesday on how the moratorium would impact the Stream project.
The Tonawanda Seneca Nation, which has been outspoken against Stream’s project, praised the moratorium.
“We urge GCEDC, the STAMP developer, to use the moratorium pause to conduct its own environmental impact study of the possible impacts of data centers at STAMP – something (the state Department of Environmental Conservation) first called upon GCEDC to do over six months ago, but which GCEDC has thus far refused to do,” said Sarah Howard, environmental consultant to the Tonawanda Seneca Nation.
Even before Hochul’s executive order was announced, the Sierra Club and the Tonawanda Seneca Nation took legal action that would block industrial development at STAMP. They filed a lawsuit in state Supreme Court, challenging a zoning agreement between the town of Alabama and the Genesee County Economic Development Center that facilitates development of STAMP.
Details are scant about the data center talked about for the Town of Portland. The project would be built on 44 acres that used to house the Sugar Hill Golf Course. The property owner has said he has received interest from what he called a major data center developer. Residents have objected to the idea.
“Gov. Kathy Hochul’s signing of the statewide moratorium on hyperscale data centers is a welcome relief for the Grape Belt Community Group as it holds off any development on the Sugar Hill site,” said Kelly Perlette, a member of the community group. “The pause gives us vital time to work alongside our town officials and the property owner, who has indicated an openness to alternative ideas, to find a better suited development for the land and our community.”The moratorium also has its critics.
“While we understand there are some valid concerns around data center development in New York State, many stemming from the state’s self-inflicted power generation shortage, executive action to enforce a moratorium on the development or construction for up to one year sends mixed signals,” said Justin Wilcox, executive director of Upstate United, a business advocacy group.
“This will not only prolong uncertainty for companies looking to New York, but ultimately jeopardize potential investment, economic development and skilled jobs,” he said.
“While states like Virginia and Texas are far more likely to be approached by possible developers, the fact of the matter is that a statewide moratorium strips away local control and a community’s ability to decide on projects that could be pivotal to their economic growth and job creation,” Wilcox said.
“We simply cannot claim to be a state at the forefront of AI innovation if we preemptively turn down opportunities that would help ensure that to be true,” he said.
Mark McManus, general president of the United Association of Union Plumbers and Steamfitters, called the moratorium “shortsighted” and said it “kills good-paying union jobs.”
“Rather than implementing guardrails to build the future of American ingenuity, Gov. Hochul is taking her ball and going home,” McManus said. “We urge the governor to work with all parties, including the hardworking New Yorkers whose jobs are at stake, to implement common sense guardrails.”
Data centers have become a hot-button topic at different levels of government.
Erie County Executive Mark Poloncarz has insisted that no data centers will receive tax breaks from the Erie County Industrial Development Agency while he remains in office.
News staff reporters Stephen T. Watson, Jonathan D. Epstein and Mackenzie Shuman contributed to this report.