Data Centers Mean Better Bond Ratings, Lower Government Costs

By Paul Steidler: At a September 1, 2026, meeting of the Loudoun County Board of Supervisors to assess a change in the approval process for data centers, several members of the County’s chief decision-making body made clear that data centers are central to preserving the County’s top-notch credit ratings. And with interest rates seemingly poised to rise further, these concerns are important and well-founded.

With 250 data centers already in operation in Loudoun, the discussion arose as the supervisors were considering a proposal that would impact how 17 additional proposed data centers are reviewed. They were grandfathered on March 18, 2025, following an arduous review, from more stringent requirements that are now in place.

With regard to a potential lawsuit over these proposed data centers, several supervisors talked about the legal risks and high costs of changing the rules in the middle of the game on data center developers. Many stressed the potential impact on credit ratings.

Loudoun County has the highest credit rating, AAA, from the three major rating agencies and has held this standing for more than 20 years as the data center boom took place in the County, America’s epicenter of data centers. The top credit ratings have enabled the County to borrow funds at lower costs as it has built many new schools and extensive public infrastructure, improving the quality of life over the past two decades.

It is also important to bear in mind that data centers are a large, predictable source of revenue for the towns and counties where they operate. As such, they bolster credit ratings while reducing the need to borrow. In Loudoun, they are a major source of revenue for the County, generating $1.3 billion annually, equivalent to $2,911 annually for every resident of the County.

The discussion about credit ratings seemed to resonate with the entire board. Instead of adopting a proposal to end the grandfathering, the Board voted 9-0 to have its legal staff asses its potential legal liabilities The Board is expected to receive that assessment at its October 6 meeting.