Relating to an exemption from ad valorem taxation of the total appraised value of real property used as a data center and the tangible personal property used by the data center to meet the data center's demand for energy.

HB 5588 would exempt from ad valorem property taxes the full appraised value of real property (including land) and qualifying tangible personal property used in "qualified data centers" in Texas. To qualify, a data center must be at least 100,000 square feet, primarily used for processing/storage/distribution of data (not telecom), and meet specific energy requirements - including using backup power for all energy needs and having an energy contract with the ERCOT grid. The exemption applies only to owners of properties meeting these criteria and would take effect January 1, 2026, but only if voters approve a related constitutional amendment in 2025.