Gov. Gavin Newsom signed seven bills Monday, Sept. 21, regulating California's data center industry, including two by San Mateo Assemblymember Diane Papan targeting water use.
Papan, a Democrat who represents Assembly District 21 and previously served on the San Mateo City Council and as San Mateo mayor, authored AB 2469 and AB 2619. Both require data center developers to disclose water consumption and, in some cases, pay for infrastructure upgrades.
The governor's office called the package "the most comprehensive data center laws in the nation," according to a press release.
What Papan's bills require
AB 2469 bars cities and counties from approving a new or expanded data center unless the developer submits a water supply assessment, projected water use and efficiency measures, and workforce disclosures. Developers must cover the full cost of any water infrastructure upgrades the project requires. Starting Jan. 1, 2028, applicants must also file a water scarcity plan describing staged measures for progressively severe drought years.
AB 2619 requires data center owners and operators, under penalty of perjury, to give their water supplier a good-faith estimate of expected water use before applying for an initial business license. At renewal, operators must report the prior year's total and direct water use.
Papan said in the bill analysis, cited by Courthouse News, that the measure is meant to give local governments and water suppliers the data they need to plan growth without jeopardizing water reliability for residents, farms and businesses.
Newsom's reversal
The signing reverses Newsom's position from 2025. He vetoed AB 93, a similar Papan bill that would have required data centers to disclose expected water use. The governor said at the time he was"reluctant to impose rigid reporting requirements" about the industry's operational details without first understanding the full impact on businesses, the Los Angeles Times reported, a veto message also quoted by Data Center Dynamics.
Papan signaled in August that the political landscape had shifted. "When you're looking down the barrel of public outcry that says we don't want [data centers] at all, and you've got localities that are saying they're going to ban them, then you know the atmosphere has changed," she told CalMatters on Aug. 28.
The broader package
Beyond Papan's two water bills, three measures (SB 1168, SB 886 and AB 2383) shift electric infrastructure costs away from residential customers and toward data center operators, according to Courthouse News. AB 1577, authored by Assemblymember Rebecca Bauer-Kahan of Orinda, requires data centers to report their energy usage to the California Energy Commission, which will include the data in annual public reports, and to give similar information to local governments when seeking approval, Courthouse News reported. A seventh bill, SB 887, strips data centers of blanket environmental review exemptions.
The Data Center Coalition, whose members include Google, Microsoft and OpenAI, warned that further regulation could push the industry out of California. The coalition said data centers contributed 665,500 jobs and more than $159 billion in economic activity statewide in 2024.
Public opinion has moved the other direction. A July 2026 Public Policy Institute of California poll found 73% of state residents oppose data center construction in their communities, the Los Angeles Times reported.
What comes next
The bills took effect as law with Newsom's signature Monday. SB 886 applies to data centers entering new transmission-level interconnection agreements on or after Jan. 1, 2027. AB 2469's water scarcity plan requirement takes effect Jan. 1, 2028.
