LANSING, Mich. — Gov. Gretchen Whitmer on Wednesday announced the Michigan Affordable and Responsible Growth Action Plan, a new framework aimed at making data center companies pay operating and building costs for its facilities in the state.
WATCH: WHITMER UNVEILS DATA CENTER ACCOUNTABILITY; LEADERS ASK IF IT'S ENOUGH
The plan has two parts. First, it calls on the Legislature to write existing Michigan Public Service Commission data center rules into state law including minimum billing demand, contract termination fees, credit and collateral requirements, and minimum contract terms.
Second, it introduces a voluntary 10-point pledge companies can sign, committing to cover their own energy and water costs, invest in new power generation, protect ratepayers from rising bills, and publicly report their environmental compliance.
No company has signed the pledge yet and the plan does not spell out penalties for a company that signs on and later falls short.
Tim Minotas, legislative and political director for the Michigan Sierra Club, argues the state needs enforceable standards rather than a company's word.
"Taking companies at their word to do the right things is not sound policy," Minotas said.
Minotas pointed to tech companies' track record on other voluntary commitments as reason for skepticism.
"We have seen these tech companies have climate pledges that they have committed to, and we are seeing them across the country falling behind on those pledges," Minotas said.
The announcement lands after UK-based company Deep Green pulled a proposed data center project proposed for the Lansing area in April following push back from residents and city council members.
Mayor Andy Schor's office says many of the same guardrails outlined in Wednesday's plan were already part of those earlier negotiations.
"These guidelines were all negotiated and agreed to when we previously had one data center developer express interest in locating here, so these are a good step in the right direction," Schor said in a statement.
Schor's office also said Lansing City Council is working on its own data center guidelines for the local ordinance.
From my initial review, I agree with Governor Whitmer in calling for this pledge and passage of this legislation. These guidelines were all things we negotiated and were agreed to and signed on when we previously had one data center developer express interest in locating here, so these are a good step in the right direction. This plan is also helpful as our City Council works on data center guidelines being put into Lansing City Ordinance.
The Lansing Regional Chamber of Commerce says it supports the plan's goals but argues Michigan needs more than good rules: it needs a faster, more predictable approval process to actually compete for projects.
"Proposals that aligned with many of these expectations have still struggled to move forward in Michigan, while neighboring states like Ohio and Indiana have attracted similar investment," said Steve Japinga, senior vice president of public affairs for the chamber, in a statement.
The chamber's full statement said Michigan has largely already incorporated principles like developer-funded infrastructure, ratepayer protections, job creation and environmental compliance into proposals pitched in Mid-Michigan communities but that those proposals have still stalled while other states move faster.
The Lansing Regional Chamber of Commerce appreciates Governor Whitmer's effort to establish a clear framework that promotes data center development while protecting taxpayers, ratepayers, and Michigan's natural resources. Providing certainty for communities, utilities, and businesses is an important step as Michigan competes for transformational investment.
At the same time, many of the principles outlined in today's plan including requiring developers to pay for necessary infrastructure, protecting utility customers from increased costs, creating good-paying jobs, and ensuring environmental compliance have already been incorporated into proposals presented in communities across Mid-Michigan. Unfortunately, proposals that aligned with many of these expectations have still struggled to move forward in Michigan, while neighboring states such as Ohio and Indiana have successfully attracted similar investments and the jobs, tax base, and long-term economic opportunities that come with them.
If Michigan is serious about attracting billions of dollars in private investment and the high-quality jobs that come with it, we must move beyond simply establishing standards. We must also demonstrate that projects meeting those standards have a fair, predictable, and timely path through the approval process. Responsible growth and economic competitiveness can, and should, go hand in hand.
FOX 47 News reached out to multiple state lawmakers from both parties for reaction to the plan's call for legislative action. None had responded by deadline.
The Michigan Public Service Commission declined to comment, saying questions should be directed to the governor's office.
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