SPRINGFIELD—A plan to make Illinois more competitive in the data centers industry is one step closer to becoming law.

Under the plan sponsored by State Senator Elgie R. Sims Jr. (D-Chicago), companies operating data centers in Illinois would not have to pay sales or use tax for materials used in the construction or operation of a data center.

“Illinois has the opportunity to be a leader in the data center industry,” Sims said. “Right now, we are fourth in the nation in this fast-growing industry. Investing in companies that bring data centers to Illinois will bring revenue and jobs to the state.”

To qualify for the tax exemption, a data center must be located in Illinois, create at least 20 new jobs over a 60-month period and be carbon-neutral or get a certification under green building standards.

New data centers must have $250 million in new capital over a five-year period. Existing data centers must make that same amount over five years on or before Jan. 1, 2020.

Indiana and other neighboring states are building data centers that border the state of Illinois, putting the pressure on Illinois to stay competitive, Sims said.

“We cannot allow states like Indiana to monopolize this industry,” Sims said. “This tax exemption would make Illinois very attractive for those looking to start or relocate in this growing business.”

Senate Bill 1591 passed out of the State Revenue Committee Wednesday. It is set to head to the Senate floor for consideration.