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“My message to data center developers is clear: if you can’t agree to our strict requirements and get the community where you want to build to say ‘yes,’ you’re not going to have the Commonwealth’s support either,” Shapiro said in a statement when he signed an executive order last month that features CBAs. “These are some of the biggest companies in the world — they can afford to be good neighbors, follow the rules, and do this right.”

Policymakers are now mulling mandates for such agreements. Shapiro signed an executive order last month ordering his state’s Department of Environmental Protection to only review permit applications for data center developers that have agreed to sign a CBA with their local community, among other requirements. Otherwise, DEP will not begin review until after all local approvals, including for zoning and land use, are secured.

The move was the latest sign that Shapiro, a likely 2028 presidential contender, has gone from a data center cheerleader to a vocal skeptic. He’s not alone. Both Democrats and Republicans are grappling with how to address a growing public backlash to the energy- and water-guzzling facilities, which are cropping up faster than political leaders and regulators can keep up.

CBAs appeal to moderate Democratic governors who are scrambling to address data center blowback without alienating the tech giants they hope can provide a much-needed boost to their local economies. But even progressives who support moratoriums on data centers, like Michigan Senate Democratic nominee Abdul El-Sayed, have referenced CBAs as a way to protect communities from data centers’ possible impacts.

Abre’ Conner, director of the NAACP’s Center for Environmental and Climate Justice, said organizers of the group’s Stop Dirty Data Centers campaign quickly realized that some projects can’t be stopped by advocacy efforts — no matter how fervently communities oppose them.

CBAs can be “a tool in communities’ toolboxes” during negotiations when data center developments turn out to be inevitable, Conner said.

Experts say that the legal agreements are far from a cure-all. So far, only one community seems to have cut a deal with a data center developer.

The Data Center Coalition also argues that the vast majority of its members— including the likes of Google and Amazon — have voluntarily invested in communities beyond the jobs they create, like filling school budget gaps. Mandating CBAs before zoning or permitting, as some states are considering, could create delays and drive developments away, said Brad Tietz, the group’s director of government affairs in the Midwest.

“We’re in uncharted territory,” said Tietz. “Mandating something legislatively is far different than it occurring naturally between the local government and the company.”

But some politicians see CBAs as a stop-gap solution, providing relief for communities and serving as a model for responsible developers before other regulations are set in stone. That’s the idea behind a package of bills that Michigan state senators unveiled in June. The legislation, backed by Whitmer, would require local governments to reach a CBA with developers before moving forward with zoning approvals.

“Community benefits agreements will not solve all of the problems, but if you can put it together with strong regulations on data centers and the entire regulatory framework, then I do think that we’re in a stronger position to have members of our community feel that they are being heard right now,” said Michigan state Sen. Darrin Camilleri (D), assistant majority leader and the package’s primary sponsor.

(Re)building trust

Data centers’ sky high unpopularity has given many communities the power to demand environmental standards and investments from developers.

“Two years ago, communities really didn’t have much leverage against a Google or a Meta. But now we’re starting to see so many data centers that are canceled because of public defense, and so now communities really have a lot more leverage than they had in the past,” said Dana Kuhnline, program director at regional coalition ReImagine Appalachia.

At least 20 proposed data center projects were canceled after local pushback during the first three months of 2026, accounting for more than $41.7 billion in investment and 3.5 gigawatts of electricity demand, according to data from Heatmap.

The opposition has prompted a wave of local moratoriums and restrictions: Virginia has enacted a new energy consumption tax and New York has paused new data center construction for a year. In Illinois, lawmakers have proposed the POWER Act, which would require data center developers to enter into a CBA with a coalition of community-based organizations or a community advisory board formed by the municipal government.

Meagan Niebler, program director at the nonprofit law firm Fair Shake Environmental Legal Services, said more communities want to stop data centers entirely instead of reaching a deal.

But if developments continue to move forward, communities will be thinking about how to hold companies legally accountable and ensure protections with CBAs, said Niebler, who has collaborated with Midwest communities to ensure environmental protections in data center development.

Pennsylvania’s regulations and proposed laws in Illinois and Michigan would mandate that companies negotiate with communities until both sides agree. But nonmandatory CBAs depend heavily on a developer’s good faith effort.

It’s “very hard” to get large companies to a table for open dialogue with communities, and locals often need a lot of organizing and legal leverage to even get their foot in the door, Niebler said.

“There’s a lot of things that make it an imperfect solution, but an imperfect solution is still better than nothing,” said Liza Paudel, senior program manager for tech equity at the nonprofit Greenlining Institute.

The data center industry says their key concern is timing. Delays can significantly derail a project if local governments are slow to appoint community members to an advisory board to discuss contract terms — like the Illinois proposal would require — or if negotiations are stretched out indefinitely, Tietz said.

“What if you have a local government who’s interested, but obviously opposition rises, and then you’ve spent 10, 12 months negotiating for the project that is not even going to advance?” Tietz said.

Developers would have more confidence in the project if permitting could occur while the CBA is being negotiated, Tietz said. That could mean, for example, requiring an agreement to be reached before construction begins — rather than before a permit is issued.