July 20, 2026
Governor Jim Pillen signed Executive Order 26-17 on July 20, 2026, directing how Nebraska administers its two principal economic development incentive programs and establishing a task force to study data centers’ impact on the state’s water, environment, and infrastructure.1
The order, titled “Responsible Administration of State Economic Development Incentives Under the ImagiNE Nebraska Act”, instructs state agencies to administer existing incentive programs with greater emphasis on protecting Nebraska’s natural resources and established industries.2 It directs the Department of Economic Development to administer the ImagiNE Nebraska Act (the state’s primary business incentive program, providing tax incentives for qualifying job creation and capital investment) and the Department of Revenue to administer the Nebraska Advantage Act (the predecessor program under which existing participants may continue to receive benefits), each consistent with legislative policy.3
The order comes amid growing concern over the rapid expansion of data centers and their potential effects on groundwater, electric infrastructure, utility costs, land use, and Nebraska’s agricultural economy.4 Twelve counties have adopted moratoriums on data centers, and several others are considering similar action. In some instances, these moratoriums reflect a desire to update local regulations for a rapidly evolving industry rather than outright opposition.5 Likewise, the order is framed as a measured approach intended to align projects with the state’s long-term interests.
Although Governor Pillen stated that the order would prevent new large-scale data centers from receiving incentives under the ImagiNE Nebraska Act, the order itself does not expressly prohibit data centers from qualifying for tax incentives.6 Instead, it establishes additional review criteria and interagency coordination before incentive decisions are made.
Under the order, the Director of Economic Development must evaluate whether projects seeking ImagiNE Nebraska Act incentives advance the state’s long-term prosperity: encouraging investment, creating high-paying jobs, attracting and retaining businesses, and strengthening the workforce. The Director must also coordinate with the Director of the Department of Water, Environment, and Energy on whether a project enhances the state’s environmental quality. For projects governed by the Nebraska Advantage Act, the Tax Commissioner must apply a comparable long-term-prosperity analysis when reviewing amendments or additions to existing agreements. The order further directs both departments to consult with state officials responsible for natural resources, energy infrastructure, agriculture, and public utilities, so incentive decisions account for broader statewide impacts.
Finally, the order establishes a Data Center Task Force through the Department of Water, Environment, and Energy to study data centers’ effects on Nebraska’s water and environment, review existing state law, and recommend legislative changes in 2027. Those recommendations are expected to address resource protection and provide guidance for county zoning of future developments.
For developers and large energy users, the order signals that Nebraska incentives will now be evaluated not only for economic benefit but also for long-term effects on the state’s natural resources, infrastructure, and communities, with further legislative and regulatory changes potentially on the horizon.
Executive Order 26-17: Nebraska Reframes Economic Incentives for Data Centers
By: Jon Blumenthal and Abby RobitailleGovernor Jim Pillen signed Executive Order 26-17 on July 20, 2026, directing how Nebraska administers its two principal economic development incentive programs and establishing a task force to study data centers’ impact on the state’s water, environment, and infrastructure.1
The order, titled “Responsible Administration of State Economic Development Incentives Under the ImagiNE Nebraska Act”, instructs state agencies to administer existing incentive programs with greater emphasis on protecting Nebraska’s natural resources and established industries.2 It directs the Department of Economic Development to administer the ImagiNE Nebraska Act (the state’s primary business incentive program, providing tax incentives for qualifying job creation and capital investment) and the Department of Revenue to administer the Nebraska Advantage Act (the predecessor program under which existing participants may continue to receive benefits), each consistent with legislative policy.3
The order comes amid growing concern over the rapid expansion of data centers and their potential effects on groundwater, electric infrastructure, utility costs, land use, and Nebraska’s agricultural economy.4 Twelve counties have adopted moratoriums on data centers, and several others are considering similar action. In some instances, these moratoriums reflect a desire to update local regulations for a rapidly evolving industry rather than outright opposition.5 Likewise, the order is framed as a measured approach intended to align projects with the state’s long-term interests.
Although Governor Pillen stated that the order would prevent new large-scale data centers from receiving incentives under the ImagiNE Nebraska Act, the order itself does not expressly prohibit data centers from qualifying for tax incentives.6 Instead, it establishes additional review criteria and interagency coordination before incentive decisions are made.
Under the order, the Director of Economic Development must evaluate whether projects seeking ImagiNE Nebraska Act incentives advance the state’s long-term prosperity: encouraging investment, creating high-paying jobs, attracting and retaining businesses, and strengthening the workforce. The Director must also coordinate with the Director of the Department of Water, Environment, and Energy on whether a project enhances the state’s environmental quality. For projects governed by the Nebraska Advantage Act, the Tax Commissioner must apply a comparable long-term-prosperity analysis when reviewing amendments or additions to existing agreements. The order further directs both departments to consult with state officials responsible for natural resources, energy infrastructure, agriculture, and public utilities, so incentive decisions account for broader statewide impacts.
Finally, the order establishes a Data Center Task Force through the Department of Water, Environment, and Energy to study data centers’ effects on Nebraska’s water and environment, review existing state law, and recommend legislative changes in 2027. Those recommendations are expected to address resource protection and provide guidance for county zoning of future developments.
For developers and large energy users, the order signals that Nebraska incentives will now be evaluated not only for economic benefit but also for long-term effects on the state’s natural resources, infrastructure, and communities, with further legislative and regulatory changes potentially on the horizon.
- Executive Order 26-17 at 4; Id. at 1.
- Id. at 1.
- Id. at 2; Id. at 3.
- Id. at 2.
- Noelle Annonen, Twelfth Nebraska County Temporarily Bans Data Centers, Neb. Pub. Media (July 16, 2026), https://nebraskapublicmedia.org/en/news/news-articles/twelfth-nebraska-county-temporarily-bans-data-centers/.
- 10/11 NOW, Gov. Pillen Signs Order to Protect Nebraska's Public Power from Data Center Drain (July 20, 2026), https://www.1011now.com/2026/07/20/gov-pillen-signs-order-protect-nebraskas-public-power-data-center-drain/.
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