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<h1 class=”page-post-title”>House NDAA provision could derail Army data center projects</h1>


 
 <p style=”font-size:smaller; color:#666666; margin-bottom: 1rem;”>”We want Congress to incentivize companies to build on secure federal land, rather than creating barriers that drive them away,” an Army official said.</p>
 
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 <span class=”Entry-date__date”>June 12, 2026</span> <span class=”Entry-date__time”>11:43 am</span> </div>
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 <p><span style=”font-weight: 400;”>An amendment in the House Armed Services Committee chairman's mark for the fiscal year 2027 defense policy bill could discourage technology companies from building data centers on military installations, hindering Army modernization efforts and future private investment, an Army official said. </span></p>
<p><span style=”font-weight: 400;”>The measure, offered by Rep. Cory Mills (R-Fla.), would bar the Defense Department from leasing its land to private companies to build data centers unless they agree not to install or operate data facility equipment that contains components manufactured in China, Russia, Iran or North Korea. </span></p>
<p><span style=”font-weight: 400;”>The restriction would apply to certain printed circuit boards, advanced semiconductors, chipsets and other components that the Defense Department considers a national security risk. </span></p>
<p><span style=”font-weight: 400;”>“Honored to pass this amendment to protect our military installations from Chinese components being used in data centers on our installations,†Mills </span><a href=”https://x.com/CoryMillsFL/status/2063003642479648894″><span style=”font-weight: 400;”>said</span></a><span style=”font-weight: 400;”> on social media platform X. “This bill protects national security, promotes American businesses, and builds industry capability.â€Â  </span></p><style><![CDATA[
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<p><span style=”font-weight: 400;”>Since t</span><span style=”font-weight: 400;”>he domestic industrial base does not yet produce some of the equipment needed for data centers, Army officials say the</span><span style=”font-weight: 400;”> amendment would create </span><span style=”font-weight: 400;”>a “federal land penalty†by imposing requirements on companies that build facilities on military installations that would not apply to similar projects built elsewhere.</span></p>
<p><span style=”font-weight: 400;”>“If a partner builds outside our gates, they don't face these rules. If they build inside, they do. This unworkable standard will drive world-class commercial partners — and over $1.3 billion in private capital — away from Army land,†an Army official told Federal News Network. </span></p>
<p><span style=”font-weight: 400;”>“Downstream, this means the Army loses access to resilient, co-located power and data infrastructure, forcing us to either fund these multi-billion-dollar modernizations with taxpayer money or fall behind our adversaries,†the Army official added.</span></p>
<p><span style=”font-weight: 400;”>The amendment comes as the Trump administration is accelerating AI data center development by allowing private companies to use federally owned land — the Army has already </span><a href=”https://www.army.mil/article/291360/army_reaches_conditional_agreement_with_private_industry_for_hyperscaled_data_centers”><span style=”font-weight: 400;”>selected</span></a><span style=”font-weight: 400;”> Carlyle Group Inc., one of the world's largest private equity firms, to build a massive data center at Fort Bliss in Texas and CyrusOne, a company jointly owned by KKR and BlackRock, to develop a similar project at Dugway Proving Ground in Utah. The service is also pursuing additional data center projects at Fort Bragg, North Carolina, and Fort Hood, Texas. </span></p>
<p><span style=”font-weight: 400;”>In return, the service would gain access to some of the data center's computing power to support its expanding use of artificial intelligence. The facilities will be fully commercially operated and allowed to sell excess computing power to its customers.</span></p>
<p><span style=”font-weight: 400;”>The Fort Bliss hyperscaled data center is expected to become operational in 2027. </span></p>
<p><span style=”font-weight: 400;”>Similarly, </span><span style=”font-weight: 400;”>the Department of the Air Force is opening up its unused land across five military bases to private companies to build AI centers.</span></p><style><![CDATA[
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<p><span style=”font-weight: 400;”>The Army official said that lawmakers have been receptive to the service's concerns. </span></p>
<p><span style=”font-weight: 400;”>“</span><span style=”font-weight: 400;”>We have shared our technical feedback on how this provision impacts our leasing authorities. The feedback we receive is generally supportive of our shared goal — securing our networks and supply chains,†</span><span style=”font-weight: 400;”>the Army official said.</span><span style=”font-weight: 400;”> “Lawmakers want to protect national security, just as we do. Our job is to help them understand when a well-intentioned policy might have the unintended consequence of halting our own modernization.â€</span></p>
<p><span style=”font-weight: 400;”>The Army stopped short of calling for the provision to be removed entirely but said it wants Congress to adopt a policy </span><span style=”font-weight: 400;”>that “secures our systems without hamstringing our partnerships.â€</span></p>
<p><span style=”font-weight: 400;”>“We want Congress to incentivize technology companies to build on secure federal land, rather than creating barriers that drive them away. If a commercial business on federal land provides services to the government, they already fall under strict, existing federal security requirements,†the Army official said.</span></p>
<p>Mills' office did not respond to a request for comment.</p>
<p><span style=”font-weight: 400;”>Rep. John Garamendi (D-Calif.) raised separate concerns about the military's broader push to host commercial data centers that are “extraordinary consumers of both energy and water,†which could strain resources needed to support military operations. </span></p>
<p><span style=”font-weight: 400;”>“We're not opposed to data centers. We just want to make sure that if we're going to put a data center on a federal facility, that federal facility is not going to be degraded by the data center,†Garamendi said. </span></p>
<p><span style=”font-weight: 400;”>“What are the energy issues? What are the water issues as it applies to the base? Is there backup power, is there light, noise pollution that would harm the utility of that base? Is there encroachment on training and operations and the physical and supply chain of security?†he added.</span></p>
<p><b>If you would like to contact this reporter about recent changes in the federal government, please email anastasia.obis@federalnewsnetwork.com or reach out on Signal at (301) 830-2747.</b></p><style><![CDATA[
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