A storm of revelations about data centers’ aggressive expansion around Hillsboro and elected officials’ support for them created powerful grassroots opposition this year. That coalition now threatens to topple the area’s longtime development-above-all status quo.
The broad movement already notched victories, including pushing officials like Gov. Tina Kotek to roll back their support for data centers and playing a key role in launching a new group of anti-data center Oregon politicians to success in this year’s primaries.
1000 Friends of Oregon, a land use nonprofit, is leading the Stand Up to Data Centers Oregon coalition’s charge against the industry. Sam Diaz is its executive director.
“Everyone has a problem right now, and they are connected,” Diaz said. “And therefore, we have to be connected.”
Data centers are giant warehouses full of computer servers. They’re the physical infrastructure behind the internet, and enable everything from “cloud” photo storage and news outlets’ websites to mass surveillance and war.
The fight comes as opposition to data centers, the higher utility bills they drive and the AI they fuel is crystallizing in Oregon.
An August poll found 73% of Oregonians opposed tax breaks for data centers, 71% opposed the warehouses themselves, and 66% wanted cities to ban their construction. The findings were consistent across political parties.
If anti-data center politicians win in November, they’ve got their work cut out for them.
Oregon already has the second largest operational data center capacity in the world, behind only Virginia, according to a 2026 report from global real estate services firm, Cushman & Wakefield.
The report also found Oregon — famous for its 0% sales tax — tied Hong Kong and Doha, Qatar, for the most favorable tax policies to data centers globally.
Oregon has about 135 data centers right now. But their roughly 2,000-acre footprint may more than quadruple in coming years as currently planned facilities are built, The Oregonian reported in August. The majority of planned data centers are in the Hillsboro area, according to a September report from ECOnorthwest and the University of Virginia.
The Oregonian also found Hillsboro area data centers’ property tax breaks account for about $85 million of the $453 million the industry is saving in Oregon this year.
Street Roots viewed the tax break agreements which were signed by Hillsboro’s economic development director, Dan Dias. The city declined to make Dias and other officials involved in the decision-making processes available for interviews and declined to answer emailed questions, citing a pending lawsuit.
Data center companies — including tech goliaths like CoreWeave, Adobe and NVIDIA — did not respond to requests for comment.
The spark
After a decade representing the Hillsboro area, State Sen. Janeen Sollman’s political downfall started earlier this year when the Democrat proposed legislation to open 1,700 acres of local farmland to new industrial development and doubled a key tax break for industry, including data centers.
Her draft bill prohibited data centers in the 1,700 acres “except as an accessory to” a large employer’s operation, and she told The Oregonian it wasn’t intended to open the door for more data centers on the land.
Less than a week into the 2026 legislative session, however, she removed the data center tax break increases from the bill after receiving intense pushback. But it had already sparked a movement.
“I think it really was the Senate Bill 1586 in the short session,” Diaz said. “That’s where you start getting (people saying), ‘Whoa, this is dealing with a lot of money, and a lot of land, and a lot of people’s livelihoods — and you’re proposing to mess with them in a session that only lasts 35 days?’”
Others echoed that, including Jody Wiser, president of Tax Fairness Oregon, and Tammy Carpenter, a democratic socialist Beaverton School Board member who defeated the more pro-business candidate, Ashley Hartmeier Prigg, to become Democratic nominee for the nearby House District 27 seat.
Sollman went on to lose her seat to progressive Myrna Muñoz.
“I don’t think it (SB 1586) is the number one reason,” Sollman told Street Roots. “The reason why I was primaried, it really had to do with the Senate Bill 916.”
That since-enacted bill, which Sollman opposed, grants striking Oregon workers up to 10 weeks of unemployment.
“AFL-CIO had a legislator, a senator, tell four senators prior to the vote, ‘If you vote no, they said they will primary you,’” she said, declining to name the senator.
The Oregon AFL-CIO declined to comment on the matter.
Sollman said the unions’ SB 916 coalition couldn’t turn her constituents against her on that bill or other issues, but they found fertile ground with data centers — especially by falsely stating the bill would have turned the whole area into data centers.
Sollman acknowledged the data center industry’s secrecy creates public distrust, and bills like hers do often open the door for future data center development. But she insisted her record was firm, pointing to her role as architect of the POWER Act, which passes increased utility costs from data centers back to them.
While there have been accusations and formal complaints filed about officials’ behind-the-scenes lobbying and influence campaigns to expand data centers in the area, nothing official has stuck so far.
What everyone agrees on, however, is that the unpopular SB 1586 left Sollman vulnerable. Then, a series of revelations in the following months added fuel to the coalition’s fire, sinking Sollman and others associated with data centers.
Two warnings and a pitch
The harms of data centers were on Diaz’s mind long before this election season.
First, he had seen the impacts for himself in Prineville back in summer 2022 when a board member who is a central Oregon rancher told him ranchers had their water allocations cut.
“And we’re like, ‘Oh man, we’re really sorry. What happened? Is it the drought?’” Diaz recalled. “He goes, ‘No,’ and he points over, and you see on the ridge all these buildings that look like warehouses. He’s like, ‘No, because of Facebook.’”
And ahead of the 2026 legislative session, Diaz received another stark warning, this time from an executive at a Virginia land use organization during an education event about data centers.
“They said, ‘Once this takes hold in your state, you really got to get ahead of it, and you probably have one election cycle before you really start seeing politicians do the bidding of data centers.’” Diaz recalled. “It was (an) important lesson for us. It created even more urgency for us to get champions and conversations and actual solutions in place for our state.”
Meanwhile, the national conversation around data centers and related technologies like AI and Flock automated license plate reader surveillance cameras grows and becomes more negative.
In early February, The Oregonian found data centers were saving “more than $450 million in property taxes this year alone through exemptions granted by local governments.”
Neither Sollman’s bill being changed, then killed, nor a one-year moratorium on new approvals of a key data center tax break that the legislature passed that session slowed the opposition coalition’s rise.
In April, 1000 Friends convened more than 60 organizations together for a half-day summit at the headquarters of Oregon philanthropy giant Meyer Memorial Trust to talk about the data center industry’s impacts around the state, Diaz said.
After a presentation of their initial findings and breakout sessions, 1000 Friends made its pitch:
“We said, ‘Look, is this something that your members care about, that is critical to your mission? … Do you want to stay in this conversation and see if there’s a better way forward?’” Diaz recalled. “The answer was resounding. ‘Yes.’ And that’s where we started building from in order to get to where we’re at now as a formal coalition.”
Then in May, The Oregonian broke the story Hillsboro had quietly approved Enterprise Zone tax breaks for 18 data centers in the previous three months, just before the statewide moratorium on those tax breaks the legislature approved went into effect. (Later reporting said 17 data centers.)
The yearly tax breaks were also often stacked, with one that will last until 2051. The program was designed to incentivize companies to bring jobs to Oregon. The Oregonian found current Washington County data centers by TikTok and X (Twitter) each employ fewer than a dozen people while receiving millions of dollars in tax breaks this year.
Key officials, who the city declined to make available for interviews, told The Oregonian they hadn’t known what was happening. Hillsboro’s mayor — who OPB reported would soon become largely absent from the conversations — said the city would stop signing new deals.
When asked if Hillsboro performed cost-benefit analyses on the tax breaks to see if they would net revenue before granting them, Cindy Dauer, a spokesperson for the city, told Street Roots the city hadn’t.
But she said it has since started the process of commissioning studies and highlighted the information on the city’s website: www.hillsboro-oregon.gov/community/data-centers.
An unlikely alliance on the offensive
On June 22, a coalition of a dozen groups and people sued Hillsboro and the companies behind the 17 data centers.
“The ideal scenario for the lawsuit is claw back the property tax deals,” said Diaz, whose nonprofit is one of the main plaintiffs.
He said the lawsuit is contesting the tax breaks on two grounds.
“The first question of, ‘Does the city have the authority to do what it did?,’ and then the second question is, ‘Even if they did, do these applications even meet the Enterprise Zone Act requirements?’” he said.
Within the suit, 1000 Friends and the 11 other plaintiffs also detail the wide-ranging impacts of data centers.
“The diversion of tax funds to subsidize data center development reduces funding to those local taxing districts, reducing the availability, scope and quality of the associated public services,” wrote 1000 Friends in the June lawsuit, referring to Hillsboro and Washington County.
Carpenter is also a plaintiff in the suit. As a member of the Beaverton School Board, she pointed out that Hillsboro’s tax breaks have statewide impacts on education funding.
That’s because allowing data centers to skip their property taxes reduces the funding for the State School Fund, which is the main source of funding for schools around the state, she explained.
The Oregon Education Association, which represents 41,000 teachers, is also a plaintiff in the lawsuit, saying it opposes the tax breaks “primarily because of their negative financial impacts on statewide education funding.”
Indeed, schools around the state and in the area are struggling to stay afloat. The Beaverton School District cut 159 positions, closed an elementary school, and burned through $16.6 million in cash reserves to plug a $37 million budget gap, the Beaverton Beat reported this month.
And the Hillsboro School District made a $20 million budget cut for the 2025-26 academic year, with the superintendent warning he expects budget reductions to continue in the 2026-27 school year, the Hillsboro News Times reported. (The cuts have a variety of causes including soaring expenses.)
Tualatin Riverkeepers is another lawsuit plaintiff. Its biggest issue is with the environmental impacts of the potential facilities, both locally and across the region through increased power demand that is blowing up the region’s climate goals.
Other lawsuit plaintiffs include Tax Fairness Oregon, three Hillsboro farmers and additional city residents.
Diaz said the lawsuit is in its early stages as the city seeks to change the court that hears the case and other initial actions happen. But he expects the companies involved have a few tricks up their sleeves.
“We anticipate that some of the data center companies that received the Enterprise Zone Act millions for their deals are probably going to throw their attorneys and any resources that they have, which is probably a lot, behind the City of Hillsboro,” he said.
CoreWeave, Adobe and NVIDIA did not comment.
A different vision
While Diaz said it’s unlikely more plaintiffs will be added, the broader Stand Up to Data Centers Oregon coalition is always welcoming new members.
That’s especially true ahead of the coming 2027 Oregon legislative session, which all parties say will be the most important session yet for deciding Oregon’s data center future.
The coalition, which includes dozens of groups so far, has come together around three principles, Diaz said.
- Stopping subsidies to the data center industry in Oregon.
- Zoning the facilities out of places the region can never get back, especially key natural areas and farmland with nutrient-rich soil.
- Invest the money saved by ending tax breaks into building an economy that sets Oregon up for long-term success.
Meanwhile, elected officials in Hillsboro and around the state retreat from their support for data centers.
Kotek, for example, went from convening an advisory group in January to stepping over it and calling for a statewide moratorium this month. Her opponent, Sen. Christine Drazan (R-Canby), had a similar trajectory. Now the pair are trading attacks on the subject ahead of the November election.
Diaz said the coalition’s lawsuit isn’t about whether the data centers can build — they can as long as they comply with all local rules — but instead attempts to redirect the money the city wants to give them to fund things that create more jobs and get the state more benefits back, like high-speed rail.
“If we’re giving billions of dollars to this industry and we’re unhappy with the ROI (return on investment),” he said. “The really good thing about this is we now know we have a lot of money that we’re investing in (tax breaks) and we can reinvest it.”
This article appears in September 30, 2026.
