STATEHOUSE REPORT |  ISSUE 25.04  |  Jan. 23, 2026
  • BIG STORY: Data center regs get bipartisan traction
  • MORE NEWS:  Retired admiral jumps in S.C.-1 race
  • ISSUE TRACKER: A look at key Statehouse bills
  • LOWCOUNTRY, Ariail:  Name-changing
  • BRACK: Expand voting instead of trying to close it
  • MYSTERY PHOTO: Blue and green
  • FEEDBACK: Send us your thoughts
BIG STORY

Data center regs get bipartisan traction

By Jack O’Toole, Statehouse bureau  |  As massive computer data centers continue to explode across South Carolina, a state senator with a history of bringing lawmakers together across ideological and party lines is preparing to introduce sweeping legislation aimed at reining in what critics call their worst excesses.

The goal, Beaufort Republican Sen. Tom Davis told Statehouse Report recently, is to build a legal framework that would allow the state to compete and win in the data center-dependent AI economy of the future, while protecting the state’s energy grid, water resources and sensitive environmental areas.

Google data center in Oregon. Credit: Wikipedia, Creative Commons

To put that challenge in perspective, experts say, it helps to understand that a single large-scale data center currently uses enough electricity to power a city of 125,000 people, enough water for a town of about half that size, and often sits on hundreds of acres in traditionally rural communities.

Lots of power.  Lots of water.  Lots of land.

Davis said his bill, expected to be introduced in the coming week, would attack all three problems directly: 

  • First, it would require data center operators to pay all of their own energy and infrastructure costs, rather than saddling ratepayers with the bills. 
  • Second, it would mandate the use of “closed loop” technologies that recycle water to reduce the strain on surface and groundwater supplies. 
  • And third, it would impose siting restrictions alongside noise and light regulations to protect the environment and residential quality of life.

“We need to be proactive on these issues and not just be laissez-faire,” Davis said.

That idea, once controversial, is increasingly popular among national and state policymakers as polls show sharply declining support for data centers in S.C. and around the country. And it received a major boost earlier this month when President Donald Trump, a strong proponent of AI-fueled economic growth, called for greater consumer protections in a social media post.

“Data centers are key to [the AI] boom,” Trump wrote on Jan. 12. “But the big technology companies who build them must ‘pay their own way.’” 

An emerging bipartisan consensus?

In recent interviews with Statehouse Report, elected officials and interest groups representing both parties and a wide spectrum of political views stressed the need for action on data centers this year.

Charleston Democratic Sen. Ed Sutton is cosponsoring a data center bill by Senate Majority Leader Shane Massey, R-Edgefield. It aims to protect ratepayers, make water usage more transparent and limit certain tax incentives. He added he was struck by the broad support for new regulations.

“It’s a very bipartisan issue in the Senate,” Sutton said. “And I’ll say, that’s refreshing.”

On the other side of the Capitol, Rep. April Cromer, R-Anderson and a member of the S.C. Freedom Caucus, described a similar dynamic in the House, with members of both parties recently expressing interest in her bill, dubbed the Data Center Responsibility Act.

Perhaps the toughest legislation introduced in either chamber to date, Cromer’s bill would require data centers to generate all their energy on-site, prohibit surface or groundwater removal and require at least one employee per 1,000 feet of floor space — ideas that arose in her conversations with local residents across the state.

“I can’t find one area that’s ecstatic about having these centers and that’s a cause for serious concern,” Cromer said. “We need to slow down and think about what we’re about to put into our state.”

S.C. Small Business Chamber of Commerce President Frank Knapp echoed those concerns in a Jan. 22 interview, stressing the impacts on local communities and the businesses that serve them.

“Our argument is simply this,” Knapp said. “If data centers require utilities to build new energy generation and infrastructure, then the data centers should pay those costs so small businesses and residents don’t wind up subsidizing giant companies like Google and Meta.”

Or as Sam Aaron of the right-leaning S.C. Policy Council put it in a separate interview: “The average South Carolinian shouldn’t be forced to pay a higher power bill just because a data center wants to set up shop down the street.”

Legislating into an unknown future

Despite broad agreement on the need for action, experts note that lawmakers at every level will have to negotiate complex tradeoffs and still-emerging technical requirements to find a path forward.

For instance, notes University of South Carolina economist Joseph Von Nessen, local leaders will have to determine whether an industry that produces higher property tax revenues but few new jobs will work in their area.

“In addition to the other considerations people have raised, including energy and water usage, communities will have to factor in the fairly low number of jobs these facilities typically create,” Von Nessen said. “For communities looking to maximize their tax base without a high employment demand, that may make sense. For others, it won’t.”

But the real complexity, according to Southern Alliance for Clean Energy analyst Eddy Moore of Charleston, lies in the inexact science of predicting the future energy needs of an industry that’s evolving fast.

In Senate testimony last year, for example, state utility executives said that they’re building for a future where 65% to 70% of new energy needs will be data center-related. But as Moore points out, that’s just an estimate based on current industry trends — and if it’s wrong, S.C. ratepayers would get stuck with the infrastructure bill for power they may not need. 

“The load forecasts we’re seeing from most of our utilities are of a different nature than those we’ve seen in the past,” Moore said, noting that they include large upward adjustments for data center demand that power companies have no experience estimating. “The problem is that all that growth is highly speculative.”

That’s why Moore argues utilities must be required to follow state-owned Santee Cooper’s lead in requiring long-term contracts with data center operators that cover the cost of new production. What’s more, he said, those contracts need binding financial guarantees.

“Let’s say a company signs a long-term contract but goes bankrupt in year two,” Moore said. “We need real financial assurances to make sure someone else doesn’t get stuck with that bill.”

Davis said  he hopes to get it passed before the session ends in May.

MORE NEWS

Retired admiral jumps in crowded S.C.-1 race

Staff reports | Retired Navy Rear Admiral Nancy Lacore of Mount Pleasant, a former chief of the Navy Reserve, is joining at least 14 other candidates running for South Carolina’s coastal 1st Congressional District.

Lacore, a relatively new South Carolina resident, is now one of a slew of Democratic candidates running to replace GOP incumbent and gubernatorial candidate U.S. Rep. Nancy Mace, including Mac Deford, Max Diaz, Matthew Fulmer and Mayra Rivera-Vazquez.

“I think our military is being politicized,” Lacore told the S.C. Daily Gazette. “I think our democracy’s at risk, to be honest, and I want to be a part of the solution.”

In her launch video, Lacore said that she was removed from her leadership role last August by U.S. Secretary of Defense Pete Hegseth and was given no reason why she was fired.

“I’ve spent decades serving our country, and I still have more to give, more to fight for and more work to do,” Lacore said in a voiceover before pledging, “I’m not done yet.”

McMaster to deliver his final State of the State

Gov. Henry McMaster will deliver his 2026 State of the State Address at the Statehouse at 7 p.m. Wednesday. It will be the term-limited incumbent’s final State of the State before turning over the reins to the winner of this November’s gubernatorial election.

McMaster’s speech will be live-streamed on the SCETV website.

In other recent news

2026: S.C. voters will elect 7 constitutional officers this year. So far, most aren’t a contest. Democrats have announced bids for just two of the seven elected constitutional offices on the ballot this November: governor and state superintendent of education. The party is still talking with potential candidates, Spain told the S.C.Daily Gazette.

S.C. Election Commission chair resigns. Former federal judge Dennis Shedd, who has presided over the S.C. Election Commission, has resigned. West Columbia attorney Robert Bolchoz will be its next chair, Gov. Henry McMaster announced.

S.C. GOP tax ‘cut’ would raise taxes for 27% of state residents. Those making less than $30,000 and between $100,000 and $300,000 would be hit hardest, according to a state Revenue and Fiscal Affairs Office analysis.

Smith defends decision to obtain Graham’s phone records. Former special counsel Jack Smith publicly defended his investigations into Donald Trump, including his decision to subpoena the phone records of South Carolina U.S. Sen. Lindsey Graham and other Republican lawmakers.

S.C. measles cases surpasses 640. The South Carolina Department of Public Health has confirmed 88 new cases of measles on Jan. 21, pushing the state’s total in the current Upstate outbreak to 646.

ISSUE TRACKER

A look at where key bills are at Statehouse

By Jack O’Toole, Statehouse bureau | Republican leaders at the state House of Representatives appear to have put two competing bills about elections on the back burner after a “civil war” broke out between factions this week.

The issue focused on whether to force party registration in elections so that political primaries would be closed.  Each faction had a different way to do it, but in the end, the bills aren’t expected to take up any more time this year.

Below is an update on 10 other major issues highlighted in our 2026 legislative preview:

1. Income tax cuts: An income tax cut bill passed last year in the S.C. House is being considered by the S.C. Senate Budget Committee. The bill would set rates at 5.39% and 1.99% based on income — lower than the current rates, but taxing more people due to changes in income exemptions and exclusions. NEW: The Senate Budget Committee advanced the House bill on Jan. 20, with an additional property tax cut for residents 65 and older.

2. Rolling back affirmative action and DEI: Several bills are currently awaiting consideration, including one to codify Gov. Henry McMaster’s executive order ending affirmative action in state contracting.

3. Juvenile justice: A special committee created by House Speaker Murrell Smith, R-Sumter, is meeting throughout the session to advance reforms to the state’s juvenile justice system.

4. Highway reform: The House Ad Hoc SCDOT Modernization Committee met last week to begin finalizing recommendations to send to the full House. NEW: Senate Transportation Committee Chairman Larry Grooms, R- Berkeley, introduced a reform measure that, among other things, would allow the state Department of Transportation to add toll lanes to highways to relieve congestion.

5. Fix the pay raise:  When the S.C. Supreme Court last year struck down an increase in lawmakers’ “in-district expenses” stipend, the decision also incidentally killed the $1,000 a month that legislators were already receiving..  NEW: On Jan. 21, senators voted unanimously to restore the $1,000 a month stipend.

6. Judicial selection: A bill with the support of leaders in both chambers would give the governor more power in selecting state judges. It’s currently awaiting action in the House Judiciary Committee. NEW: The leaders’ bill cleared the subcommittee and now heads to the full Judiciary Committee for further action.

7. Abortion: A House Judiciary subcommittee on Jan. 14 killed one bill to treat abortion as homicide and advanced another to reclassify abortion pills as Schedule IV drugs.

8. Concurrency: A bill by Beaufort GOP Sen. Tom Davis that would allow local governments to limit development in areas with insufficient infrastructure is pending consideration in the Senate Labor, Commerce and Industry Committee.

9. DOGE SC: Multiple bills promising to cut the state workforce and the regulations they enforce have been introduced for consideration in 2026. In particular, House GOP leaders have pledged to get their “Small Business Regulatory Freedom Act” passed into law this session.

10. Immigration: Currently in the House Judiciary Committee, H. 4764 would require all S.C. sheriffs to partner with the federal government to enforce national immigration laws.

ROBERT ARIAIL’S LOWCOUNTRY

Name-changing

Credit: Robert Ariail

Award-winning cartoonist Robert Ariail has a special knack for poking a little fun in just the right way.  This week, he essentially ponders whether there’s any justice at ICE.

COMMENTARY

Expand voting instead of trying to close it

Commentary by Andy Brack  |  The Republican political kerfuffle over whether primary elections should be only open to members of a political party or all voters is nothing more than election-year blather.

It’s a hot issue that tanked this week in the S.C. House, where some GOP members got all hot and bothered about whether anybody should be able to vote in Republican primaries and then be classified as a Republican or whether the state should have party registration so that only registered members can vote.

S.C. Rep. Brandon Newton, the Lancaster Republican who sponsored a more mainstream bill backed by the state Republican Party, classified the fervor inside the party as a kind of “civil war.”

“This has been the nastiest debate internally I’ve ever witnessed in the party structure,” he told the S.C. Daily Gazette. “The divide on this topic and the divide between two pieces of legislation have truly put, I believe, the party in a civil war.” 

The issue essentially pitted some mainstream Republicans, who backed Newton’s bill to allow undeclared voters to participate in a GOP primary, but be classified as registered Republicans afterwards, against a bill by the S.C. House Freedom Caucus. It pushed a measure for party registration to be completed at least 30 days before a primary before participation was allowed.  That bill would essentially would exclude anybody, including independents, who didn’t register well before the primary.

Both bills stalled in committee this week and are not expected to raise their heads again this session. 

For most of us, this is all a bunch of narrow insider GOP politics to appeal to the far right wing of the base where some people get all bent out of shape about the possibility that a demon Democrat or independent might actually vote in a primary of Republican candidates. 

File photo by Ruta Smith Credit: Ruta Smith

“You’ve got this belief among some in the Republican Party that Democrats are coming over and adopting the mantle of being Republican and really not having the small government ideology that Republicans have,” one senior Republican elected official told us this week.

Really?  Is it that big of a deal in a state where we have high poverty, inadequate education and substandard health care? Aren’t there bigger problems than trying to figure out who might be invited to an election party?

You’d think Republicans would want to attract new voters, including independents and Democrats, so that they might eventually switch their allegiance, especially if the non-Republicans move to a new primary because candidates seem better.

On a broader level, trying to curb voting is kind of dumb, too.  As Americans, we should want to encourage as much voting as possible, not erect barriers to keep people out.  Representative democracy works best when as many voices as possible are heard.

Fortunately, some senior leaders in the GOP, including Gov. Henry McMaster, aren’t having anything much to do with battling factions of S.C. House Republicans over the issue.  McMaster has said he’ll veto any closed primary bill that might get to his desk.

And state senators seem to be less than impressed with preening election year politics  by GOP members of the House.

“This is a good example of the House being a more populist body and the Senate being a more deliverable body,” one Democratic senator told us.

“It’s an election year.  It’s to be expected.  They can huff and puff all they want.”  

And so they do.  Cock-a-doodle-do!

Andy Brack is editor and publisher of the Charleston City Paper and Statehouse Report.  Have a comment?  Send to: feedback@statehousereport.com.

MYSTERY PHOTO

Blue and green

With the last few mystery images being kind of tough, we thought we’d throw a bone this week of this maritime scene.  Where is it?  Send your best guess – plus hometown and name – to: feedback@statehousereport.com.  

Meanwhile, last week’s mystery – “Obscured old house” – is the Julius Dargan House in Darlington. 

Jay Altman of Columbia told us this about it:  “It was built about 1856, and is a rectangular, two-story weatherboarded Greek Revival style residence with interior stuccoed chimneys. It has a hipped roof and a two-tiered, pedimented portico with four square, paneled columns on each floor. 

“It was the home of Julius Alfred Dargan (1815-1861) a lawyer, a member of the House of Representatives, a trustee of the Darlington Academy and a signer of the Ordinance of Secession in 1860.”

Others who correctly identified it were George Graf of Palmyra, Va.; and Allan Peel of San Antonio, Texas.

  • SHARE: If you have a Mystery Photo to share, please send it to us – and make sure you tell us what it is!
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  • Have a comment?  Send your letters or comments to: feedback@statehousereport.com.  Make sure to provide your contact details (name, hometown and phone number for verification.  Letters are limited to 150 words.
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