MA — State Policy Updated 2026-07-17

Massachusetts

State-level incentives Local/municipal incentives Statewide restrictions Zoning controls Environmental constraints that commonly apply

1) Incentive programs (state + notable local)

State-level incentives

  • Qualified Data Center sales/use tax exemption (enacted 2024; implementation finalized in 2026): Massachusetts provides a sales and use tax exemption for certified qualified data centers covering eligible data center equipment, computer software, electricity, and construction costs for costs incurred after November 20, 2024. The statutory framework remained in effect on July 17, although new applications were administratively paused as described below. Massachusetts Legislature, 2026-07-17; Massachusetts DOR TIR 25-5, 2025-01-09
  • Eligibility thresholds: A qualified data center must be in Massachusetts, be owned/leased by the operator or an affiliated entity, include at least 100,000 square feet of data center buildings on a single or contiguous parcel(s), have at least $50 million in qualified data center costs within 10 years of certification, and maintain at least 100 Massachusetts jobs, plus required power, fire-suppression, and security features. Massachusetts Legislature, 2026-06-10; Massachusetts DOR TIR 25-5, 2025-01-09
  • Certification required; EOED discretion: The owner/operator must apply to the Executive Office of Economic Development (EOED), and EOED certification is required before the exemption can be claimed. Massachusetts Legislature, 2026-06-10
  • Duration: The exemption statute provides a 20-year qualification period and transfers remaining tax benefits to a subsequent owner if a qualified data center is sold. Massachusetts Legislature, 2026-06-10
  • Final regulation: The prior draft-regulation language is now outdated. EOED finalized 400 CMR 9.00: Qualified Data Centers with a Mass.gov regulation date of March 27, 2026; the final rule establishes certification procedures and provides that EOED will approve or deny a completed application within 60 business days. Mass.gov, 2026-03-27; Mass.gov PDF, 2026-03-27
  • Applications paused pending stronger guardrails: On June 25, Governor Healey directed EOED to stop accepting qualified-data-center exemption applications until stronger ratepayer, infrastructure, environmental, public-health, labor, and community protections are in place. The statute and 400 CMR 9.00 remain on the books, but the program page states that EOED will accept no applications until further notice while it evaluates the regulation and process. Mass.gov press release, 2026-06-25; Mass.gov program page, 2026-06-25
  • Clean-energy and public-benefit conditions are now executive expectations, not yet statutory criteria: The existing exemption statute and final regulation do not themselves specify renewable-procurement or efficiency thresholds. The June 25 administration framework now expects applicants to fund clean generation sufficient for 100% of demand, avoid cost shifts and stranded infrastructure, use efficient/flexible operations, protect water and public health, support good jobs and community benefits, and disclose energy, water, emissions, employment, and interconnection information. The framework supplements rather than replaces permits and acknowledges that some elements require legislation or rule changes. Mass.gov framework, 2026-06-25; Mass.gov framework PDF, 2026-06-25
  • FY2027 tax expenditure estimate: The Governor’s FY2027 Tax Expenditure Budget continues to list TE Item 3.007 for qualified data center purchases and estimates $17.0 million in annual sales/use tax revenue loss for FY2026 and FY2027. Budget.Mass.gov, 2026-01-28
  • Pending MassQuantum incentive bill (H.5436): H.5436 would create a Massachusetts Quantum Center and extend the data-center certification framework to “qualified quantum corporations.” The Joint Committee on Economic Development and Emerging Technologies held a written-testimony hearing on June 23, but the bill remained in committee and had not changed the exemption as of July 17. Massachusetts Legislature committee page, 2026-06-23; Massachusetts Legislature PDF, 2026-03-17

Local/municipal incentives (observed in operator materials)

  • Lowell (Markley Group): Markley’s Lowell data center marketing materials continue to cite a personal property tax exemption on equipment as a facility benefit, indicating a local incentive or exemption at that site. Markley Group, 2026-06-10
  • Westfield (Servistar Realties / proposed campus): Westfield previously negotiated a Chapter 121A-style PILOT for the proposed hyperscale campus, with local reporting describing average annual PILOT payments of about $6.4 million and projected $360 million over 40 years; no new executed 2026 fiscal agreement was located. The Westfield News, 2021-10-06

2) Restrictions and moratoriums

Statewide restrictions

  • No enacted statewide construction moratorium as of July 17, 2026: The administration paused new tax-exemption applications, not data-center permitting or construction. A proposed statewide data-center moratorium and coordination council was rejected during the Senate’s July 1 debate on S.3143, and no statewide ban was enacted. Mass.gov press release, 2026-06-25; Massachusetts Legislature, 2026-07-01

Zoning controls (local)

  • Municipal authority remains central: Massachusetts zoning is municipal under M.G.L. c.40A, including special-permit review and zoning bylaw/ordinance amendments. That local-control structure is now driving data-center-specific moratoriums and zoning amendments. Massachusetts Legislature, 2026-06-10
  • Lowell 360-day moratorium adopted March 10, 2026: Lowell adopted a zoning amendment imposing an immediate 360-day moratorium on new data-center construction and development, prohibiting acceptance of new applications and permits for data-center zoning permissions while the city studies infrastructure and quality-of-life impacts. The city manager’s March 10 packet states the Planning Board gave a unanimous positive recommendation on March 2, 2026. City of Lowell, 2026-03-10; Lowell City Council agenda, 2026-03-10
  • Shutesbury temporary moratorium expired, but the use remains prohibited: Shutesbury’s temporary moratorium expired on June 20, 2026. The town’s operative zoning use table separately marks “Data Center” as not permitted in every district, so expiration did not make data centers an allowed use. A proposed permanent regulatory article was removed from the 2026 Annual Town Meeting warrant before the vote. Town of Shutesbury Zoning Bylaw, 2026-05; Town of Shutesbury Select Board minutes, 2026-04-14
  • Mansfield near-total size/location restriction adopted May 5, 2026 (pending AG review): Mansfield’s Annual Town Meeting adopted a dedicated data-center zoning bylaw, pending Attorney General review, that permits only Tier I data centers of 2 MW or less by Planning Board special permit in specified planned business and industrial districts; Tier II (more than 2 MW up to 10 MW) and Tier III (more than 10 MW) facilities are prohibited. Town of Mansfield, 2026-05-05; Boston.com, 2026-05-13
  • Gill one-year moratorium adopted May 4, 2026: Gill voters approved Article 7 at the May 4, 2026 Annual Town Meeting, creating a one-year moratorium on data centers and certain BESS facilities through May 3, 2027 so the Planning Board can develop zoning regulations. Town counsel reportedly warned that the BESS portion may face Attorney General issues, but the data-center moratorium was viewed as more likely to be approved. Town of Gill warrant/motions, 2026-05-04; Greenfield Recorder, 2026-05-05
  • Northborough adopted a 5 MW cap and special-permit regime: Annual Town Meeting approved Article 53, defining data centers, limiting eligible facilities to 5 MW or less at full build-out, and allowing them only by Planning Board special permit in the industrial district, with review of power, water, wastewater, noise, air, traffic, screening, and emergency access. Town of Northborough warrant and motion, 2026-04-27; Citizen Portal meeting record, 2026-04-30
  • Millis adopted its data-center zoning amendments: Millis reports that all articles at the May 4 Annual Town Meeting passed, including the warrant’s definitions and use regulations for “Data Storage Center” facilities. Attorney General-approved final codification was not located by July 17. Town of Millis results, 2026-05-04; Town of Millis warrant, 2026-05-04
  • Lakeville adopted data-center siting and utility-use restrictions: Annual Town Meeting voters approved the Planning Board’s June 8 article applying the town’s marijuana-overlay regulatory approach to data centers and restricting water and electrical use by potential projects. Attorney General-approved final codification was not located by July 17. Nemasket proposal report, 2026-06-02; Nemasket town-meeting results, 2026-06-09
  • Southborough adopted restrictive industrial-park standards: Annual Town Meeting approved Article 17 without amendment on April 11. The measure allows data centers only by Planning Board special permit in the Industrial Park district, caps them at 50,000 square feet, and requires a 1,000-foot setback from residential or conservation districts; zoning changes remained subject to Attorney General review. My Southborough proposal summary, 2026-03-31; My Southborough town-meeting results, 2026-04-13
  • Everett enacted Docklands limits on June 22: The City Council ordained zoning amendments limiting data centers in the Everett Docklands Innovation District to 20,000 square feet and 5 MW and requiring them to be ancillary rather than stand-alone uses. This replaces the prior pending-status description. Advocate News, 2026-06-25; City of Everett ordinance packet, 2026-05-11
  • Holyoke enacted a citywide ban on new data centers: The City Council voted 9-4 on June 16 to prohibit the use in every zoning district while exempting the existing Massachusetts Green High Performance Computing Center; Mayor Joshua Garcia signed the ordinance on June 18. The decision ended Chestnut River Power and Infrastructure’s proposed $200 million, 20 MW reuse of the former Hampden Papers complex on Water Street. NEPM, 2026-06-17; Western Mass News, 2026-06-18
  • Westfield enacted a 365-day moratorium: The City Council unanimously gave final passage on July 6 to a one-year pause on accepting or approving data-center applications while the city studies natural-resource, public-health, and infrastructure impacts. Mayor McCabe signed it July 7; it runs through July 6, 2027. The already-approved Servistar proposal is not expressly invalidated by the generally worded pause. Western Mass News, 2026-07-06; Westfield Residents Advocating for Themselves, 2026-07-07
  • Additional municipal proposals remained pending: Malden was considering a one-year permit moratorium and new use category; Greenfield shifted a proposed one-year zoning moratorium toward a City Council ordinance; Wilmington’s Economic Development Committee recommended a special town meeting on a moratorium/prohibition; and Chelmsford published draft fall-town-meeting standards. None was a final enacted restriction by July 17. City of Malden hearing notice, 2026-06-10; Greenfield Recorder, 2026-07-06; Wilmington Apple, 2026-06-21; Town of Chelmsford draft, 2026-07-08

Environmental constraints that commonly apply

  • Water withdrawals: The Water Management Act requires a permit for withdrawals over 100,000 gallons/day average or 9 million gallons in any 3-month period, which can be relevant for cooling-intensive facilities. MassDEP, 2026-06-10
  • Air permitting for generators: MassDEP’s air regulations require plan approval before constructing or altering a facility or emission unit that may emit air contaminants; large backup-generator installations typically trigger this framework. MassDEP 310 CMR 7.02, 2026-06-10
  • Noise regulation: 310 CMR 7.10 prohibits unnecessary emissions of sound that may cause noise, making it relevant to generator, chiller, and cooling-tower complaints. MassDEP 310 CMR 7.10, 2026-06-10
  • MEPA review thresholds: Large data center campuses can trigger MEPA review depending on site size, land alteration, impervious area, water, and other thresholds. Mass.gov MEPA resources, 2026-06-10

3) Local governance and community dynamics

  • Lowell litigation and EJ concerns remain unresolved: Lowell residents and advocacy groups challenged MassDEP’s approval of Markley Group’s air permit for an expansion involving 27 industrial diesel backup generators and 16 cooling towers near the Sacred Heart neighborhood. The lawsuit was still pending on July 16, while residents continued to report generator fumes and cooling noise and Markley disputed the allegations. CLF, 2026-04-30; NBC10 Boston, 2026-07-16
  • Everett community concerns: Everett residents and Planning Board members raised concerns about a potential Docklands data center before a specific application was filed; reporting states The Davis Companies had no specific data-center plan but wanted to preserve flexibility for the former ExxonMobil site. WBUR, 2026-04-06; Boston.com, 2026-04-08
  • Active statewide pattern of local pushback: By July, local action extended beyond Lowell, Mansfield, Gill, Everett, Northborough, Millis, and Lakeville to Holyoke, Westfield, Southborough, Malden, Greenfield, Wilmington, and Chelmsford. The recurring concerns are ratepayer and grid costs, water capacity, backup-generator emissions, noise, land opportunity costs, and the small number of permanent jobs relative to facility scale. Mass.gov framework, 2026-06-25; The Shoestring, 2026-07-02

4) Legislative activity (2024-2026)

  • Acts of 2024, c.238 (Economic Development Act): Created the qualified data center sales/use tax exemption and required EOED/DOR implementation. Massachusetts Session Laws, 2024-11-20
  • M.G.L. c.23A Section 70 and c.64H Section 6(zz): These remain the core statutory provisions for EOED certification and the sales/use tax exemption. Massachusetts Legislature, 2026-06-10; Massachusetts Legislature, 2026-06-10
  • 400 CMR 9.00 finalization: EOED finalized the qualified data-center regulation on March 27, 2026, replacing the earlier draft/regulatory-hearing status. Mass.gov, 2026-03-27
  • HD.5404 (large/qualified data center electricity-cost bill): HD.5404 would add M.G.L. c.164 Section 152 for facilities able to use 10 MW or more, requiring DPU review of distribution-company rates and cost attribution to prevent construction or operating costs from increasing residential or income-eligible customer rates. Its only docket action remained the December 11, 2025 referral to House Rules; it had not been enacted by July 17. Massachusetts Legislature, 2026-07-17; Massachusetts Legislature PDF, 2025-12-05
  • H.5175/S.3166 headed toward conference, with materially different data-center approaches: The House’s February 26 text (passed 128-27) would apply to facilities of at least 20 MW, require 80% renewable energy for certain DPU/EFSB permits, require a battery-infeasibility showing before fossil-backup permits, and order utility data-center tariffs. On July 1 the Senate replaced that text with S.3166 and passed it 32-8. S.3166 instead conditions the existing tax exemption on EOED requirements for clean energy, affordability, grid optimization, water, public health, labor, community benefits, economic development, and transparency, and authorizes EOED to condition, suspend, revoke, limit, or deny benefits. The House non-concurred on July 16 and appointed its conference members, so neither version was law at the cutoff. Massachusetts Legislature bill history, 2026-07-16; Massachusetts Legislature House text, 2026-02-26; Massachusetts Legislature S.3166 PDF, 2026-07-01
  • Rejected statewide proposals: During the July 1 Senate debate, amendments for a data-center moratorium/coordination council and separate data-center energy-cost provisions were rejected. Separately, the House rejected FY2027 budget Amendment 1218 on April 29; it would have required annual electricity/ratepayer-impact reports and created a commission on power procurement and cooling-water efficiency. Massachusetts Legislature S.3143 amendments, 2026-07-01; Massachusetts House Journal, 2026-04-29
  • H.5436 (MassQuantum): H.5436 would add qualified quantum corporations to the data-center exemption certification structure. It received a June 23 written-testimony hearing but remained in the Joint Committee on Economic Development and Emerging Technologies and was not enacted by July 17. Massachusetts Legislature committee page, 2026-06-23; Massachusetts Legislature PDF, 2026-03-17

5) Notable projects and operators

Major operators with facilities in Massachusetts

Announced/under-construction projects

  • Westfield Servistar campus reactivated but remains preconstruction: The city reported June 15 that the ten-building project, locally approved in 2021 and largely paused while the state incentive was pursued, had resumed advancement after the 2024 law. It still had not broken ground by July: the project needed a permit extension before October and an ISO-NE interconnection study and developer-funded substation, which the municipal utility estimated could take about five years. Reported building loads of 18-42 MW each imply a potential 180-420 MW campus, while the previously reported investment remains about $4 billion. City of Westfield, 2026-06-15; The Shoestring, 2026-07-02; Boston Globe, 2026-07-14
  • Holyoke proposal canceled by zoning ban: Chestnut River Power and Infrastructure proposed a $200 million, 20 MW adaptive reuse at 100 Water Street in June, but Holyoke’s June 16 ban foreclosed the project and the developer said it would seek other former manufacturing sites rather than fight the city. WAMC, 2026-06-16; NEPM, 2026-06-17
  • Lowell expansion contested rather than newly cleared: Markley’s Lowell expansion remains legally and politically contested. The 2026 lawsuit challenges the MassDEP air approval tied to a total of 27 diesel backup generators and 16 cooling towers. CLF, 2026-04-30
  • No other confirmed new hyperscale construction start located for February 1-July 17, 2026: ISO-NE’s forecast still treated the region’s included data-center proposal as not under construction. Massachusetts developments during the period were proposed or contested projects, regulation, legislation, and local land-use action rather than a verified new hyperscale groundbreaking. ISO Newswire, 2026-05-18

Source checklist (primary sources prioritized)

  • Statutes/session laws: M.G.L. c.64H Section 6(zz); M.G.L. c.23A Section 70; M.G.L. c.40A Section 9; Acts of 2024 c.238.
  • Regulations/agencies: EOED 400 CMR 9.00 final regulation; DOR TIR 25-5; MassDEP water, air, noise, and MEPA resources.
  • Legislation: HD.5404, H.5175, S.3143/S.3166, H.5436, and FY2027 budget-amendment records.
  • Local actions: Lowell, Shutesbury, Mansfield, Gill, Northborough, Millis, Lakeville, Southborough, Everett, Holyoke, Westfield, Malden, Greenfield, Wilmington, and Chelmsford materials.
  • Projects/operators and reporting: Markley Group, Equinix, CLF/Yale Law School, WBUR, Boston.com/Boston Globe, NEPM.