Data center tax breaks cost Ohio schools

Education funding losses tied to soaring data center subsidies

Ohio’s data center sales tax exemption cost the state nearly $1.6 billion in forgone revenue in 2025. A new report from Good Jobs First and Policy Matters Ohio finds that the cost of the subsidy exceeded the annual funding gap legislators created when they abandoned the bipartisan Fair School Funding Plan.

Even if the additional revenue was distributed proportionally through the state budget, public schools could have had approximately $374 million in additional foundation funding last year.

“Ohio lawmakers made a choice to give data center companies a blank check, and now Ohio’s schools are paying the price,” said Hannah Halbert, Policy Matters Ohio’s Executive Director. “The state’s largest data center agreements allow companies like Amazon, Google, and Meta to receive decades of tax exemptions with costs that have ballooned in recent years. In 2025 alone, the state gave up enough revenue from this single tax break to fully update the Fair School Funding Plan and close the gap.”

“Lawmakers claim Ohio cannot afford to fully fund public education, but this report demonstrates that affordability is not the issue. Priorities are,” said Kasia Tarczynska, Senior Research Analyst at Good Jobs First. “At a time when public schools, Medicaid, and other core services face funding pressures, legislators should end new data center tax breaks, rein in existing agreements, and ensure these companies contribute their fair share to the communities whose infrastructure, schools, water, and energy systems make their investments possible.”

The report includes estimated state funding losses for every traditional public school district in Ohio and recommendations to permanently end the data center sales tax exemption, recover revenue from existing agreements, protect schools from local tax abatements, and strengthen transparency and accountability requirements for future projects.