New York Governor Kathy Hochul has announced the release of a statewide Host Community Investment Framework designed to help local governments negotiate community benefits from future data center developments.
The framework recommends that data center developers provide at least $1 million for every megawatt of utility power demand associated with a project. The initiative is intended to ensure that communities hosting large-scale data centers receive meaningful, long-term investments to address infrastructure needs and other local priorities.
Under the framework, a 50-megawatt data center, for example, would have a recommended community investment level of $50 million. Local governments and developers would determine the timing and structure of the investments based on the needs of each community and the characteristics of individual projects.
Potential investments could support roads, water and sewer systems, public transit, parks, affordable and workforce housing, schools, workforce training, child care, broadband access, public safety, small businesses and community institutions. Funding could also be directed toward revitalizing vacant or underutilized properties.
The framework also outlines “Good Neighbor Commitments” addressing potential impacts from data center operations, including water consumption, noise, lighting, building design and landscaping. It encourages developers to provide prevailing wages for construction workers, prioritize local hiring and work with organized labor to create quality employment opportunities.
Hochul said the framework gives communities tools to protect their interests as demand for data centers grows alongside the rapid expansion of artificial intelligence.
The framework was developed following Executive Order No. 62, which Hochul signed on July 14, 2026, establishing a year-long statewide moratorium on new data center development while New York develops consistent standards for the industry.
During the moratorium, state agencies are evaluating potential impacts related to energy demand, water use and quality, air quality and infrastructure. The state is also developing measures intended to prevent existing utility customers from bearing costs associated with large data center projects.
New York’s Department of Public Service is considering requirements that data centers either pay more for their energy or provide their own power. The state is also exploring a potential New York Grid Acceleration Fund that could require data center developers to contribute toward grid infrastructure and new clean-energy resources.
The Community Investment Framework is voluntary and does not replace existing environmental reviews, permits or other state, federal and local requirements. Local governments are encouraged to involve residents and stakeholders early in negotiations and provide ongoing public reporting on a facility’s employment, energy and water use, community investments and environmental impacts.