As data center plans ramp up, so do bills to rein them in

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For most of the country, the month of July is the epitome of summer activity. School is out. Campgrounds are full. Calendars are packed. 

But at the Capitol, this peak period of summer brings a different rhythm. With lawmakers back in their districts and on vacations, it gives staff the chance to, as one person put it, “take a giant deep breath.”

In that spirit, today we’re rounding up where the Legislature stands on what has quickly become a flashpoint in both tech and environmental circles: data centers. 

A proposal to build a data center in the North Bay Area was met with intense backlash last week, as a California company aims to leverage the state’s fairground and exposition sites to house the computing facilities. 

As the Chronicle’s Megan Fan Munce reported, Global Stack LLC is pitching cities across the state to allow them to use fairground lands – many of them owned by nonprofits or local governments – to erect AI data centers. They propose building data centers on 70 of the state’s approximately 80 fair and exposition sites by 2030.

Several could be in the Bay Area, though one Napa County city has opted out. Rachel Stepp, Calistoga’s deputy city manager, told the Chronicle it will not be moving forward with the project after significant public outcry. 

But several other cities’ fairgrounds boards have discussed Global Stack in public meetings, according to records and interviews, including in San Mateo, Kings and Tulare counties. The company’s proposed data center sites span up and down the state, from Riverside and Kern counties to Bishop, Santa Clara and Butte counties. 

The data centers house the physical computing technologies and hardware, like high-process servers, that fuel AI machines and learning. As AI integration and development continues to power a historic economic boom, companies are racing to build the physical architecture needed to fuel artificial intelligence programs. Over the past two years, this rapid expansion of data center facilities has been met with increasing skepticism by local communities, who question the impact these centers have. 

Several bills are moving through the state Legislature this session seeking to better understand those very questions.

Tech Oversight California, a nonprofit tech watchdog, is supporting two of them: AB2619 and AB1577.

Kevin Liao, spokesperson for Tech Oversight California, said the group’s top priorities for data center regulations this session is to gain a better understanding of their potential impacts on communities. 

“The thread between the two bills is data transparency,” Liao said. “They give policymakers information about how these data centers are being constructed and how they are being used, to then make smart decisions about whether there needs to be further regulations.” 

AB2619, authored by Assembly Member Diane Papan, D-San Mateo, requires data centers to report their projected and annual water usage, and directs state agencies to develop water efficiency guidelines to evaluate proposed data centers by 2029.

AB1577, from Assembly Member Rebecca Bauer-Kahan, D-Orinda, requires data centers to report their energy use information with state regulatory agencies and directs the state’s Energy Resources Conservation and Development Commission to publish the energy data every two years, starting in 2029. 

Another Papan bill, AB2469, would prohibit data center construction if it increases peak water use limits.

But like the AI technology the data centers support, legislative efforts and regulations are struggling to keep up the pace. Already, the state is home to hundreds of data centers, with dozens more proposed. Many of the proposed regulations, if passed through both chambers and signed into law, would take a few years to go into effect. 

The Chronicle’s April 2026 analysis of data from energy database company Cleanview found California is currently home to 5% of the U.S.’s total data center capacity. While other states’ projected data centers may soon eclipse California’s, it remains a top concern for both tech oversight groups and environmental watchdogs. 

State Sen. Steve Padilla, D-Chula Vista, authored the only data center regulation bill that passed last year, SB57. Signed by Gov. Gavin Newsom in October 2025, the bill directed the California Public Utilities Commission to conduct a study by next year on data centers’ impacts on the energy grid, and how those may affect ratepayers in the state.

This year, Padilla is the author of two additional bills seeking to gather more information on the facilities: SB886 and SB887. The former would establish a new tariff for the centers, applied by the CPUC, meant to cover the costs associated with connections to the electrical grid, in order to prevent those costs from being passed on to the everyday consumer.

The other, SB887, would clarify data centers are not ministerial projects exempted from California Environmental Quality Act review, or CEQA. In Imperial, part of Padilla’s district, a development that could become the state’s largest data center is locked in controversy over these environmental review standards.

“People deserve to know environmental and health impacts they may face when data centers are set up near their homes,” Padilla said in a statement to Capitol Confidential. “Done correctly, these massive infrastructure projects can support the grid and provide economic opportunity for the community.”

When these projects go “unchecked,” he said, they can cause “skyrocketing energy costs for consumers and environmental damage.”

Two other bills, AB2383, from Assembly Member Rick Chavez Zbur, D-Los Angeles, and SB1168 by Sen. Jerry McNerney, D-Pleasanton, also seek to restructure energy classification to try to avoid data center usage costs from being passed on to residents and small businesses. 

It’s already the most talked about ballot measure, but now the California billionaire tax may be heading toward another mantle: the most divisive. 

The Chronicle’s Joe Garofoli reported that Planned Parenthood, among the state’s most progressive power groups, is taking a hard stance against the measure. It has the group going toe to toe against coalitions that they are usually in lockstep with, namely the influential union Service Employees International Union-United Healthcare Workers West, SEIU-UHW. 

Planned Parenthood Affiliates of California CEO Jodi Hicks told the Chronicle the organization opposes the billionaire tax not “because we agree with any of the billionaires that are affected or why they’re taking their position.” Rather, Hicks said Planned Parenthood’s board thought the measure was poorly written and would provide only a one-time revenue boost at a time when California needs ongoing funding to recover from President Donald Trump’s HR1, the One Big Beautiful Bill Act. 

Planned Parenthood also objected to the way the ballot measure came together. Hicks told the Chronicle the measure was crafted largely by SEIU-UHW. 

“It’s a conversation that I’ve never been a part of,” Hicks said of the process. 

Service Employees International Union-United Healthcare Workers West leader Dave Regan said “the people who work at Planned Parenthood, the people that use Planned Parenthood for services are overwhelmingly on our side. This really is a disagreement among a handful of political operatives in the inside baseball game in Sacramento.” 

SEIU, a different union that represents hundreds of Planned Parenthood workers in California, is still reviewing the measure and has not yet taken a formal position, a spokesperson told the Chronicle. Two other major players, The California Federation of Labor Unions and the California Democratic Party, have not yet taken positions on the tax, but are expected to by late this summer.

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