Democrat Gov. Janet Mills vetoed legislation that would have placed a temporary moratorium on large data center projects in Maine, while backing a separate review of the industry's impact.
The bill, L.D. 307, would have paused permitting for data centers and created a council to study siting, energy use, and environmental effects.
In a release from her office, Mills said she supported a temporary moratorium in principle but objected to the bill's failure to exempt a specific redevelopment project in the Maine community of Jay.
"A moratorium is appropriate given the impacts of massive data centers in other states on the environment and on electricity rates. But the final version of this bill fails to allow for a specific project in the Town of Jay that enjoys strong local support from its host community and region," Mills said.
In a letter to the Legislature following the Friday veto, Mills pointed to a $550 million data center project planned for the former Androscoggin Mill site, which closed in 2023 after a boiler explosion and loss of operations.
"The 2023 closure of the Androscoggin Mill dealt a devastating blow to the Town of Jay and its surrounding area," Mills wrote, adding that the project is expected to create more than 800 construction jobs and at least 100 permanent jobs.
She said the project, which has received permits and is under contract, would also generate local tax revenue and reuse existing industrial infrastructure.
"I supported the exemption and would have signed this bill if it had included it," Mills wrote in the letter.
Mills said she intends to move forward with an executive order to establish a council to examine the impact of large-scale data centers in the state.
"I believe it necessary and important to examine and plan for the potential impacts of large-scale data centers in Maine, as the use of artificial intelligence becomes more widespread," she wrote.
She also signed separate legislation prohibiting data center projects from Maine's business development tax incentive programs.
National Review reported that developers warned the Jay project could have been halted if the moratorium had taken effect and that construction is scheduled to begin this summer.
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