Arkansas has expanded its tax breaks for data centers in the Natural State.

First reported by Law360, Gov. Sarah Huckabee Sanders last week signed HB 1444/Act 548 into law.

Introduced in February by Republican Representative Aaron Pilkington and Senator Jonathan Dismang, HB1444 – To Amend the Sales and Use Tax Exemption for Data Centers - lowers the investment requirement thresholds from $500 million to $100m, and requires the facilities not to be primarily used for cryptomining or blockchain activities.

It also expands the state’s existing tax abatements to include expansions or additions to facilities and adds a definition for large data centers (defined as two or more non-adjacent physical locations that are connected by fiber and totals $2bn or more in investments).

Arkansas signed its current data center tax breaks into law in 2023. That bill, HB1654, was again sponsored by Rep. Pilkington and Sen. Dismang and enforced in April 2023.

Arkansas has traditionally had a very limited data center market, with colo operator TierPoint and local ISPs Brightspeed, Cox, and Windstream all having facilities in the state. The likes of TW Telecom, MSP Mainstream Technologies, and blockchain firm Sollensys also operate in Little Rock.

A couple of large campuses have been proposed in West Memphis and Conway in the last 18 months.

Sales and use tax exemptions are an increasingly common way for legislators in the US to try and make states more attractive to data center developers.

The likes of Virginia, Maryland, Arizona, Idaho, Washington, Georgia, Pennsylvania, Connecticut, and others have signed similar bills granting tax breaks for data centers.