A provision that would ban the Defense Department from leasing its land to private companies to build data centers containing components made by U.S. adversaries is moving through Congress. If passed, the measure could complicate the department’s future modernization efforts.
Rep. Cory Mills (R-Fla.) included the provision in the House Defense Committee’s version of the fiscal year 2027 defense authorization bill, which passed the chamber this week. The amendment would prohibit companies from “installing or operating data asset equipment” that contains certain circuit boards, advanced semiconductors, chipsets and other components that the Defense Department considers to be a national security risk.
“I am honored to pass this amendment to protect our military installations from the use of Chinese components in our installations’ data centers,” Mills said said last month. “This bill protects national security, advances American businesses, and strengthens industrial performance.”
The army, however told Federal News Network that the change would create a “federal penalty” by imposing requirements on companies building facilities on military installations that would not apply to similar projects built elsewhere.
]]>
The service already has selected Carlyle Group Inc., one of the world’s largest private equity firms, plans to build a massive data center at Fort Bliss in Texas, and CyrusOne, a company jointly owned by KKR and BlackRock, is expected to develop a similar project at Dugway Proving Ground in Utah. The Fort Bliss project is expected to reach initial operational capability in fiscal year 2027.
The army said mills This measure would create an “unworkable standard” that would “drive world-class trading partners — and over $1.3 billion in private capital — away from Army land.”
But as the Pentagon accelerates its plans to house commercial data centers on its grounds — the Air Force, for example, is also opening its unused land at five military bases to private companies to build AI data centers — lawmakers are increasingly focused on the broader implications of these projects.
The owners of the House of Representatives have recognized this the military’s broader push to build commercial data centers on its land represents a “significant strain on energy and water resources” and that “communities have resisted such projects.” The committee directed the Secretary of Defense to consider how the proposed data center projects might impact surrounding communities “before physical construction of a data center on site begins.”
Specifically, lawmakers want the Pentagon to study energy and grid needs, water and environmental impacts, physical security and mission assurance impacts, and cumulative risks and community impacts.
Rep. John Garamendi (D-California) introduced a similar measure during the House Defense Committee’s markup earlier this summer, but the committee voted against it. Rep. Derrick Van Orden (R-Wis.), who opposed Garamendi’s provision, argued that allowing data centers on military installations would help preserve farmland.
“I believe that [the amendment] will prevent us from maintaining AI dominance over China, and it will prevent us from using federal reserves, meaning these data centers will end up on black dirt and remove fertile soil from our agricultural economy that we simply don’t need right now,” Van Orden said.
]]>
Rep. Mike Rogers (R-Ala.), chairman of the House Armed Services Committee, opposed the amendment, arguing it would “hamper the Army’s ongoing negotiations.”
“The nation with the best data infrastructure will have a decisive advantage in the next war. The United States cannot afford to lose this position,” Rogers said.
Meanwhile, Rep. Rashida Tlaib (D-Mich.) introduced a standalone bill this week that would ban the construction of AI data centers on federal land altogether.
“Everywhere I go in our district, our residents tell me loud and clear that data centers are not welcome in our communities,” Tlaib said in a statement. “Our residents are suffocating in smog and already paying too much on their electric bills, but the Trump administration wants to impose even greater burdens on hard-working Americans.”
“The No AI Data Centers on Federal Lands Act provides a critical guardrail to protect our public lands and ensure that the rush to build AI infrastructure does not come at the expense of our health, our environment, or our democratic voice,” added Mar Zepeda Salazar, legislative director of the Climate Justice Alliance.
To contact this reporter about recent changes in the federal government, please email anastasia.obis@federalnewsnetwork.com or contact Signal at (301) 830-2747.
https://federalnewsnetwork.com/congress/2026/07/congress-ramps-up-scrutiny-of-pentagon-ai-data-center-plans/
