WASHINGTON — In response to the introduction of the No Secrets for Data Centers Act the American Economic Liberties Project released the following statements: 

“It’s clear that big tech firms and data center developers are using nondisclosure agreements to cut communities out of the data center planning process, and to push through unpopular projects that have the potential to raise costs for local households,” said Morgan Harper, director of policy and advocacy at the American Economic Liberties Project. “We applaud this bipartisan group of legislators for introducing the No Secrets for Data Centers Act, and urge more lawmakers to take seriously the issue of transparency and accountability in data center development.”

“We are glad to see so many federal and state leaders take on this insidious practice when it comes to data centers. The use and abuse of these NDAs is a clearly corrupt practice meant to circumvent democratic accountability and benefit corporate interests,” said Pat Garofalo, director of state and local policy at the American Economic Liberties Project. “We also believe these bans should go beyond data center projects to economic development programs more broadly. If it’s harmful to block a community from knowing about a data center, it’s equally harmful to block them from knowing about any large-scale proposed economic development project that involves public resources and broad, downstream effects for residents.” 

The bill put forward by Representatives Greg Landsman (D-Ohio),Tom Barrett (R-Mich.) and Jamie Raskin (D-Md.) would void non-disclosure agreements signed by government officials that hide information about data center developments. The bill would also block operators from getting public funds if receiving them depends on keeping construction specifics from the public. It does, however, have a carve out to exempt trade secrets found in standard submissions to state utility regulators. 

As data centers proliferate across the country, their exorbitant power and water needs are straining the capacity of local utility systems. To prevent sufficient public input into these extractive arrangements, data-center end users such as Google, Meta, and Amazon employ broad nondisclosure agreements (NDAs) that prevent public officials — such as city council members, mayors, state legislators, or public economic development officials — from divulging many pertinent details of these development deals, including the identity of the project’s end user.

The issue of non-disclosure agreements in public projects is one Economic Liberties has tracked for years. In 2022 the organization co-founded the Ban Secret Deals Coalition to call for the end of this practice in economic development writ large. Last November Garofalo released a memo detailing exactly how local municipalities could rein in this sneaky practice specifically when it comes to data centers.  

Governors in Maryland, Virginia, Pennsylvania, and Massachusetts have all issued executive orders to crack down on the use of NDAs in data center deals.

Learn more about Economic Liberties here.