Kansas Approves Major Data Center Incentive Program
Kansas now offers a full sales and use tax exemption for qualified data centers investing $250 million or more
Kansas is setting the stage for a new wave of data center investments with the approval of Senate Bill 98 (SB-98). This landmark legislation provides a complete sales tax exemption on construction, remodeling, and essential data center equipment purchases for qualified companies. By eliminating state and local sales and use tax (SUT), Kansas is positioning itself as a prime destination for businesses engaged in data processing and storage.
With the exemption kicking in on July 1, 2025, forward-thinking investors and tech companies have a golden opportunity to leverage Kansas' business-friendly climate and expand their data infrastructure. As the digital economy continues to surge, SB-98 makes Kansas a highly attractive hub for cutting-edge data operations.
SNAPSHOT
Kansas signs bill offering tax incentives for investment in data centers.
Program awards 100% sales and use tax exemption for qualified data centers.
For companies committing $250 million within five years of commencing operations in Kansas.
Qualified data centers to take advantage of the exemption on or after July 1, 2025.
EVALUATION CRITERIA
Approval Requirement: The company must receive prior approval from the Kansas Fusion Center Oversight Board, which can reject posing a threat to critical state infrastructure.
Application & Agreement: The company must submit an application to the Secretary of Commerce and enter into an agreement upon approval.
Investment & Construction Commitment: The company must invest at least $250 million in a qualified data center within five years of starting operations and begin construction within ten years of the agreement.
Resources & Utility Commitments: The company must adhere to water conservation, reuse, and replacement practices and commit to purchasing electricity from a public utility for ten years.
Job Creation Mandate: The company must create and maintain at least 20 new jobs at the data center within two years of starting operations.
Location Considerations: Businesses locating within Superfund sites or the National Priorities List may qualify without a payroll threshold.
PROGRAM BENEFITS
Sales & Use Tax Exemption: The program provides qualified data centers a 100% sales and use tax exemption on qualified data center costs and equipment for up to 20 years.
CONNECT WITH HICKEY’S KANSAS INCENTIVES TEAM
The Hickey & Associates incentives team has advised data center companies navigating the complex incentives process. Contact us for more specifics, including eligibility criteria, application details, and funding requirements.
If you’d like our support throughout the application process, we are here to help.