S. 5689
RECLAIM Act
Sponsor: Bernie Moreno · 0 cosponsors
In plain English: what this bill does
Summary
- This bill would stop large AI data centers from getting federal grants, loans, or tax breaks.
- It would also add a federal tax equal to 100 percent of any state or local incentive a large AI data center receives, which would effectively cancel that incentive.
- The bill would take effect only after the Treasury Secretary issues final rules.
Who this affects
- Operators of covered data centers: They could not receive federal financial help or tax incentives for building or running the facility, and they would owe a tax equal to any state or local incentive they receive.
- The Treasury Secretary: Must write rules within one year to define "AI accelerator chip" and to explain how to value and time state and local incentives for these data centers.
- The Commerce Secretary: Must work with the Treasury Secretary on defining AI accelerator chips and on possible rule adjustments.
- State and local governments: The bill does not directly require them to act, but it states that they should repeal or reform data-center-specific tax incentives.
Words to know
- Covered data center: A facility or campus with a planned peak power demand of at least 100 megawatts, where at least half of its computing chips are used for artificial intelligence work.
- Accelerator chip: A specialized computer chip, such as a graphics processing unit, designed mainly for artificial intelligence tasks.
- Incentive: Money, a loan, or a tax break given to encourage a business to invest or operate in a place.
For example
Made-up numbers:
- A data center is designed for 200 megawatts, and 60 percent of its chips are AI chips, so it is a covered data center.
- A state gives it a $10 million tax break.
- Tax owed under the bill: 100% × $10 million = $10 million.
- Net effect: the $10 million state break is canceled by the federal tax.
Written by AI from the bill's text below; it can be wrong. How it's written
Official summary
No official summary yet.