Business
‘You’re a liar.’ Why the world’s biggest building boom has run into a wall in California
Bryan Marsh was booed by the crowd as he approached the podium in Monterey Park’s City Hall. Things weren’t going as planned.
In front of a wall of people holding “No Data Center” placards, he outlined how his company, Australia’s HMC StratCap, invested tens of millions of dollars and became the city’s largest landowner after years of negotiations, clearances and hearings.
City officials had previously welcomed its plans to build a sprawling, new data center and the jobs and tax revenue that would follow, he said, but then things suddenly changed.
“There was no widespread opposition,” until late last year, he said as people in the room yelled, “You’re a liar!” “Now, for the last few months, the city has faced intense public pressure.”
California’s notorious NIMBYs have a new cause. They are worried that the data centers that power artificial intelligence will lead to pollution, higher power bills and worse. It is a nationwide movement gaining momentum and particularly poignant in California, arguably the birthplace of the AI boom.
City officials had previously welcomed plans to build a sprawling, new data center and the jobs and tax revenue that would follow.
(Gina Ferazzi / Los Angeles Times)
It’s also one of the reasons most blue-collar jobs tied to the unprecedented buildout of data centers are going to other states.
Medhi Paryavi advises governments and companies on data center projects across the country. When he recently suggested California to a European executive looking to invest hundreds of millions of dollars, he was quickly dismissed.
“Absolutely not!” the executive snapped back, said Paryavi, the chairman of the Washington D.C.-based think tank International Data Center Authority.
The aversion to California is pretty standard in the industry. Land is expensive, electricity rates are high and there are too many regulations. Meanwhile, new roadblocks pop up regularly as the state’s outspoken citizens change the rules and protest.
Investors with a choice often choose elsewhere.
Signs of protest pepper frontyards in a neighborhood in Monterey Park on Wednesday.
(Robert Gauthier / Los Angeles Times)
“They’re looking for cost, time and availability of power,” said Paryavi. “California is not on the map.”
The artificial intelligence revolution might be led by companies from California, but most of the facilities housing the chips — and the jobs that come with building and maintaining them — are in other states.
Tech companies led by Microsoft, Google, Amazon and Meta are projected to spend $710 billion on data center buildouts this year alone, according to JLL, a real estate investment firm.
Despite huge plans, seemingly insatiable demand and low vacancy rates, the total capacity of data centers under construction declined last year for the first time in five years, according to CBRE. While construction boomed in some places such as Chicago and the Dallas area, those gains were offset by declines around Silicon Valley, northern Virginia and elsewhere, CBRE data showed.
A technician works at an Amazon Web Services AI data center in New Carlisle, Ind., on Oct. 2.
(Noah Berger / Associated Press)
Legacy markets such as California and Oregon are expected to lose more than half of their relative market share, with Texas set to become the country’s leading data center market within the next three years, according to a report by Bloom Energy, an energy company.
An estimated $98 billion in projects were blocked or delayed in the second half of 2025, more than all cancellations since 2023, said Data Center Watch, an organization tracking opposition to data centers across the U.S.
In California, some areas such as Vernon have welcomed data center investment, but there is a growing list of locals trying to stop data centers in Imperial County and elsewhere.
Progressive lawmakers Bernie Sanders and Alexandria Ocasio-Cortez recently introduced a bill to pause all new data center construction until federal guardrails and safeguards are instituted for workers, communities and the environment.
The proposed data center in Monterey Park — the size of four football fields — is close to homes. It is expected to consume three times the energy used by the entire city, which residents say will raise their electricity bills and also increase noise and air pollution.
The empty property on Saturn Avenue had plans to be converted to a data center in Monterey Park, Calif.
(Robert Gauthier / Los Angeles Times)
The crowd of more than 200 people who gathered at its City Hall was overwhelmingly opposed to the data center. Supporters of the project were only a tiny minority. For hours, person after person stepped to the microphone to announce their anxiety. The center will hurt property values, AI takes jobs, big AI is a threat to democracy, it’s a “class injustice.”
“The tech bros are absolutely the Epstein class,” said one. “They are not the working class.”
“Let’s make this town a place where people want to come live, where people want to do real things, where they are not relying on a robot or a program or an app to run their lives,” said another.”
Supporting the data center, and trying to avoid a vote on its existence, were only a few people from HMC StratCap and some union representatives in orange worker vests.
They pointed out that the big investment had already been agreed to, would create jobs and that it was hypocritical for the city’s citizens to want the fruits of technology while, at the same time, being unwilling to accept its infrastructure.
“Everybody loves the juice, but they don’t like how it’s squeezed,” said a member of the sheet metal workers union from the area. “I am going to fight for my members to have a job to work at.”
To be sure, it is much more than just NIMBYism that makes it tough to build in California. Regulations aimed at protecting consumers and the environment make it harder to access the power that data centers need. The regulations also contribute to the high rents and building costs.
“There’s a lot of legislation, and a lot of red tape in the state of California you have to go through in order to get data centers approved,” said JLL real estate broker Darren Eades.
NTT, Vantage Data Center and downtown San José on Tuesday, July 30, 2024 in Santa Clara, Calif. Dozens of data centers being built for artificial intelligence are eating up Calfifornia’s electricity.
(Paul Kuroda / For The Times)
One example he pointed to is the small power plant exemption, which stipulates that construction over 50 megawatts requires additional paperwork and a longer lead time for approvals. Larger data centers these days need 20 times that amount of power.
All of this makes it more likely that investors will avoid California. As hundreds of billions of dollars are being spent building data centers, it will lead to jobs in other states and countries.
“While it is the cradle of innovation, Silicon Valley is not the cradle of delivering AI outputs and delivering economic results,” Paryavi said.
Following the seven-hour hearing, council members greenlit a June ballot measure allowing residents to vote on a ban.
It was a victory for a new activist group called No Data Center Monterey Park, which spearheaded the rapid grassroots mobilization and worked with San Gabriel Valley Progressive Action to sign petitions and raise awareness. To pack the City Hall meetings, activists set up a mahjong parlor and a traditional Chinese lion dance performance to engage the largely Chinese community.
For HMC StratCap the council’s decision marked a significant blow. The Australian firm invested $40 million to acquire a 200,000-square-foot property intended for data centers, along with a larger adjacent parcel of land for an undisclosed development.
Things turned sour despite reassurances that the data center would generate $5 million in annual revenue to support park maintenance, libraries and repairs without raising residential taxes.
HMC StratCap has to win the vote in June or give up on the project. If it has to do that, it will be forced to sue the city.
“Our preferred path is not to litigate,” HMC’s Marsh said at the hearing. “We must, however, protect our legal rights.”
Now it looks like HMC StratCap may be giving up on the project.
A letter from its parent company in Australia, dated March 31 and posted on Monterey Park’s official website, said the company has withdrawn its application to build the data center.
The letter pointed to new restrictions on data center development in the city and the June vote on a ban.
“These regulations are not conducive for data center development,” it said.
Business
Crop Undercount Raises Questions About Reliability of U.S.D.A. Data
The Agriculture Department projected last July that farmers would harvest 86.8 million acres of corn in autumn. The projection was repeatedly revised upward until, in January, the department found 1.3 million more acres of corn — an area larger than Delaware — and concluded that the final amount harvested was 91.3 million acres.
“It was a miss. No other way to call it,” said Seth Meyer, who served as the department’s chief economist until leaving in December.
The 5 percent undercount may seem small, but it was the department’s worst projection in recent memory. It came as the Trump administration was cutting staff at the Agriculture Department and as President Trump’s trade war raised prices for equipment and hurt exports.
Some people in agriculture have become increasingly worried about the reliability of department data. That skepticism could lead to a breakdown of the historically close relationship between the department and farmers it serves, they said.
“U.S.D.A. always had a great relationship with its farmers,” said Mr. Meyer, who now leads the Food and Agricultural Policy Research Institute at the University of Missouri. “That seems to have weakened.”
The Agriculture Department publishes thousands of reports annually on everything from county-level sorghum planting to China’s hardwood market. But its estimates of crop size are some of the most closely read reports. Traders use information from the reports to immediately buy and sell commodities, affecting the prices that farmers receive for their crops. Farmers use the information to make decisions about how and when to try to sell their crop for the most money.
Department officials haven’t offered an official explanation for the miss, but many outside it point to staffing cuts and lower survey response rates.
The Agriculture Department lost 23,000 employees in 2025, as Elon Musk’s Department of Government Efficiency slashed jobs across the federal government. The National Agricultural Statistics Service, which produces crop reports, was one of the hardest-hit divisions; it lost 34 percent of its staff, going to about 500 employees from around 800.
The corn miss prompted Farm Journal, an agricultural publication, to ask respondents to its monthly survey whether they remained confident in department data. Most of the farmers, ranchers and economists polled responded “no.”
“People trade the reports whether the reports are true or not,” said Shay Foulk, who farms 1,500 acres and runs a seed business near Peoria, Ill. Since farmers are trading in commodity markets against sophisticated managed funds and trading algorithms, he said, “the farmer just feels they are at a disadvantage if those numbers are inaccurate.”
For years, the department has struggled with fewer farmers returning its surveys, one of the key data sources for crop production reports. The response rate for recent surveys was around 40 percent, according to the department, down from around 60 percent a decade ago.
“When farmers lose trust in the agency, they don’t want to participate as much, and so there is a direct line between low staff and low participation and incorrect data,” said Senator Amy Klobuchar of Minnesota, the ranking Democrat on the Senate Agriculture Committee, in an interview.
In March, Democrats on the Agriculture Committee wrote a letter to Scott Hutchins, the under secretary for research, education and economics at the Agriculture Department, concerned about the reliability of the department’s data. They also said the department’s proposed relocation of employees from Washington to hubs around the country “threatens to worsen the loss of key institutional knowledge and staff capacity.”
Mr. Hutchins, who was appointed by Mr. Trump last year, said in an interview that farmers still trusted the agency but had “well-founded frustrations” with the corn misestimate.
Asked whether losing employees had anything to do with the miss, he said, “Absolutely, unequivocally no.” Mr. Hutchins added that the department’s ability to develop new efficiencies had been “enhanced tremendously” by the departures, and that it was using more remote sensing abilities and artificial intelligence to collect data.
“I don’t understand what all of the additional staff might’ve been doing for us to still produce the same outcome with the current staff that we have,” he said.
Mr. Hutchins did say he was worried about the department’s entering a data doom loop if response rates continued to fall. “It is kind of a self-fulfilling prophecy,” he said. “The fewer surveys we have, the larger the standard error we will have in estimates.”
The corn miss was a major topic of conversation last week at the semiannual Agriculture Department data users’ meeting, held at the Federal Reserve Bank of Kansas City. It is normally a low-key event attended by departmental economists, academics, agricultural company representatives and others, where heads of different divisions preview new data products and answer esoteric methodology questions. But this time, there was a heavy focus on heightening transparency and increasing survey response rates.
Lance Honig, the acting director of the department’s statistics division, suggested that 2025 was an anomaly. Because of the large amount of corn planted and record yields, the normal statistical models were off.
“I would suggest that the 2025 crop season was a bit different than anything we had seen in, oh, I don’t know, what would that be — 80, 90 years,” Mr. Honig said.
The Agriculture Department recently put out a request for information for commentary and ideas about its data products. It is also planning to increase the number of farmers surveyed for its acreage reports, pending approval from the Office of Management and Budget for the higher cost to send out more surveys.
One meeting attendee, Bill Lapp, a food industry consultant, suggested that surveys be made mandatory for those receiving money from the government’s bailout package for farmers. “For $12 billion, can’t you get them to fill out a damn postcard a couple of times a year?” he asked in a question-and-answer session.
Farmers have a deep and direct relationship with the federal government, which sustains much of their business. Farmers participate in crop insurance and conservation programs, apply for grants and receive disaster assistance and ad hoc payments. The Agriculture Department projects that government payments will account for 29 percent of farm income this year.
These programs run on data obtained from farmers. They must certify the number of acres they plant with the Farm Service Agency in order to participate in income support programs. To get crop insurance, farmers must give their financial information to the Risk Management Agency. So when they are also mailed surveys asking detailed questions about their crops, some farmers get annoyed, because they believe the department has, or should have, the data.
Mr. Foulk, the Illinois farmer, said farmers were in part disgruntled with the federal government because of their declining influence. On tariffs, biofuels policy and the farm bill, farmers haven’t gotten what they wanted lately.
“We had the privilege of having this outsized voice, and now we’re not as loud,” he said.
Farmers are unlikely to stop participating in Agriculture Department programs that directly benefit them, no matter how they feel, said Mr. Meyer, the former agency economist. But their very viability is underpinned by data and analysis.
“Supporting data collection has historically and continues to support the things that directly impact them,” he said.
Business
California billionaire tax proposal attracts 1.5 million signatures. Here’s what happens next
California, home to the ultra-rich in Silicon Valley and Hollywood, is embroiled in a heated fight over whether to tax billionaires to fund healthcare.
This week, supporters of the proposed billionaire tax began submitting nearly 1.6 million signatures, nearly twice the number needed to qualify for the November ballot.
Election officials now need to verify that the signatures are valid for the initiative to land on the ballot.
The proposal would impose a one-time tax of up to 5% on taxpayers and trusts with assets valued at more than $1 billion, with some exclusions, such as property.
Supporters of the tax, including the Service Employees International Union-United Healthcare Workers West, say it would raise $100 billion, offsetting federal funding cuts to healthcare. A small portion of the funds would also go toward education and state food assistance.
If the proposal makes it to the ballot, it sets the stage for an intense, costly battle over whether the state’s billionaires should pay for services that lower-income residents depend on. Some tech moguls have pushed back against the idea and threatened to move. Some have already moved.
Voters will probably be bombarded with political ads and arguments from opposing sides as the battle intensifies.
Here’s what could happen next:
What are supporters arguing?
Supporters of the billionaire tax are tapping into people’s frustrations about healthcare and wealth inequality. They’ve pushed back against the idea that billionaires can avoid the tax by moving, noting that it applies to billionaires residing in California as of Jan. 1, 2026.
“When funding is cut, it brings a world of pain,” said Mayra Castañeda, an ultrasound technologist and a member of SEIU-United Healthcare Workers West, in a statement. “It means longer ER waits, fewer healthcare workers, rural hospitals shutting down, delayed care and lives lost that could have been saved.”
Vermont Sen. Bernie Sanders has backed the idea.
“At a time of massive income and wealth inequality, the richest people in our country must start paying their fair share of taxes,” he posted on social media site X on Monday.
What are opponents arguing?
Opponents say the tax could harm California’s economy and leadership in innovation without addressing the state’s financial woes.
“Because the state relies so heavily on high-income-earner tax revenue, this measure could lead to reduced budget revenue in the long term as highly mobile wealthy individuals leave the state to avoid this new tax,” said Rob Lapsley, president of the bipartisan California Business Roundtable.
The Legislative Analyst’s Office said last year that it is hard to predict the exact amount the state will collect because of factors such as fluctuating stock prices, which affect wealth. In a December letter, the office said the state would probably collect tens of billions of dollars from the wealth tax, but it could also lose other tax revenue.
California Gov. Gavin Newsom opposes the wealth tax proposal. Earlier this year, he told Bloomberg he had concerns about how the proposal had been drafted. He also expressed fears that wealthy taxpayers will move out of the state.
“The impact of a one-time tax does not solve an ongoing structural challenge,” he told the news outlet.
How much are opponents spending to fight the billionaire tax proposal?
Billionaires are spending millions of dollars to fund groups that are fighting the proposal or promoting other solutions they say would address wealth inequality.
In late December, PayPal and Palantir co-founder Peter Thiel contributed $3 million to the California Business Roundtable, which is opposing the billionaire tax, according to spending data filed with the secretary of state.
In March, former Google Chief Executive Eric Schmidt donated $1 million to that group. Other tech executives have contributed hundreds of thousands of dollars this year. It’s unclear how much of that money goes toward opposing the tax since the donation was made to the entire group.
Since January, tech executives, venture capitalists and business leaders have donated roughly $93 million to a nonprofit called Building a Better California, according to data on the secretary of state’s website. A large chunk of that funding came from Google co-founder Sergey Brin, who donated $57 million to the nonprofit. Executives from DoorDash, Ripple, Stripe and other companies have also contributed to the group.
Building a Better California’s website outlines policies it supports, such as expanding affordable housing and more transparency in state government. The group has told donors that it offers “near-term and longer-term protection against wasteful government spending and any and all new taxes on personal property and personal assets.”
Brin, who relocated to Nevada last year, told the New York Times that he fled “socialism” when his family left the Soviet Union in 1979, and he doesn’t “want California to end up in the same place.”
Are there other proposals that could kill the billionaire tax?
Yes. Another initiative, known as the “Improving Transparency, Effectiveness & Efficiency in California Government Act,” could nullify the billionaire tax act.
It would prevent new taxes from being exempt from a voter-approved state spending limit, in contrast to the billionaire tax measure.
Supporters of the transparency act, including Building a Better California and Inland Empire Economic Partnership, plan to submit about 1.5 million signatures to county election officials this week.
If voters approve conflicting ballot measures, the one with more yes votes would take effect.
How much have groups spent on a ballot measure in the past?
Hundreds of millions of dollars has been spent on ballot measures in the past. In 2020, a record $200 million was spent on Proposition 22.
The initiative, funded by Uber, Lyft, DoorDash and other businesses, allowed gig companies to classify their workers as contractors rather than employees.
With the battle over the billionaire tax expected to heat up, spending on both sides is likely to climb.
Times staff writer Seema Mehta contributed to this report.
Business
Rising Fuel Prices Could Force Excruciating Choices on Economic Policies
With the flow of energy through the Middle East still mostly blocked and oil prices rising, policymakers in Europe are confronting the immediate impact of higher costs and trying to decipher the potential economic damage of a prolonged conflict.
On Thursday, officials at the European Central Bank and Bank of England are expected to hold interest rates steady, but investors are betting that each central bank will raise rates at least twice later this year. Economists and lawmakers will be watching closely for signs about how the central banks will respond to jumps in inflation.
The effective closing of the Strait of Hormuz, a vital waterway for fuel and other commodities off Iran’s southern coast, has sharply increased energy prices. Brent crude, the international benchmark, has pushed well above $100 a barrel, while European natural gas prices are nearly 40 percent higher since the United States and Israel attacked Iran at the end of February.
The war had an almost immediate impact on European inflation, increasing gasoline prices at the pump, airfares and other fuel-intensive activities. In Britain, the annual inflation rate climbed to 3.3 percent in March and is expected to stay around 3 percent through the second quarter, a percentage point above the central bank’s target. For the 21 countries that use the euro, inflation averaged 2.6 percent in March, up from 1.9 percent a month earlier.
But for the central banks, the question is whether higher prices will ripple through the economy and eventually push up wages, potentially setting off a spiral of escalating prices that would warrant aggressive rate increases like those in 2022. For now, analysts say there isn’t enough information on how the war, seemingly in a holding pattern, will affect the economy. While President Trump has extended a cease-fire in the region, traffic through the strait remains sparse.
At the same time, the concern about inflation is being weighed against the possibility that the war damages economic growth. In that scenario, policymakers wouldn’t want to tighten financial conditions. Consumer sentiment in Germany, the eurozone’s largest economy, dropped to its lowest level in three years, data this week showed. This month, the International Monetary Fund said the bloc’s economy would grow 1.1 percent this year, but that assumed a relatively quick resolution to the war and the recovery of global energy markets.
“The E.C.B. will stay in ‘wait and see’ mode, at least for now,” analysts at HSBC wrote in a note. But “the risk of prolonged energy supply disruption, coupled with risks of second-round effects on inflation,” increase the probability of the central bank’s raising interest rates later.
It’s a dilemma facing central banks farther afield as well. This week, the Bank of Japan voted to hold interest rates steady, but it was a split decision with several officials preferring an increase in rates. The central bank raised its inflation forecast while warning that economic growth is likely to slow this year.
On Wednesday, the Federal Reserve also held interest rates steady. It acknowledged the war’s effect on the economy, saying inflation had ticked up because of the “recent increase in global energy prices.”
-
Connecticut24 seconds agoConnecticut Senate Approves More Towing Reforms, Expanding on Landmark 2025 Legislation
-
Delaware6 minutes ago
America250 in Delaware: What to know about the 250th birthday plans
-
Florida12 minutes agoSpaceX rocket launch this weekend. See liftoff from the Treasure Coast
-
Georgia18 minutes agoRivian downsizes new EV factory after Trump’s DOE slashes loan agreement
-
Hawaii24 minutes ago
Tin Can Mailman: Preserving Hawaii’s past, one paper treasure at a time
-
Idaho30 minutes agoSix transgender residents sue Idaho after state criminalizes use of bathrooms
-
Illinois36 minutes agoIL Accountability Commission refers federal agents for investigation, possible prosecution
-
Indiana42 minutes agoIndiana standoff ends after SWAT armored vehicle rams home: sheriff