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Texas AI Infrastructure
Regulatory Checklist
A due diligence framework for companies investing in AI infrastructure in Texas
Updated February 2026 · 3 Critical Sections · Actionable Checklists
Why This Checklist Exists
Texas is the fastest-growing AI infrastructure market in the United States. It is also navigating an evolving regulatory landscape that combines foreign ownership restrictions, critical infrastructure scrutiny, and local fiscal policy.
Whether you're evaluating a site, conducting due diligence on an existing facility, or managing stakeholder relationships, this checklist helps you identify regulatory exposure before it becomes a liability.
What's Inside
SB 17 Real Estate Audit
Beneficial ownership mapping, control test compliance, leasehold review
90th Session Critical Infrastructure Forecast
Supply chain scrutiny, grid vulnerability, alternative legal systems
"Operation Double Nickel" Fiscal Hedge
Appraisal growth caps, Chapter 312/313 strategy, voter sentiment
1. SB 17 Real Estate Audit
Texas SB 17 restricts ownership and leasing of property near critical infrastructure by certain foreign entities. This section provides a compliance framework:
- Beneficial Ownership Verification: Map all entities with 5%+ ownership, identify foreign government-affiliated investors
- Control Test Compliance: Review board composition, assess management agreement provisions
- Leasehold Review: Verify ground lease structures, assess sublease chains
2. 90th Session Critical Infrastructure Forecast
The 90th Legislature (2027) is expected to revisit foreign investment scrutiny, grid resilience, and supply chain integrity. This section helps you prepare:
- Supply Chain Integrity: Map vendor relationships subject to foreign entity scrutiny
- Grid Vulnerability Assessment: Model ERCOT demand-side risk, evaluate backup generation
- Alternative Legal System Exposure: Review contractual provisions referencing foreign legal frameworks
3. “Operation Double Nickel” Fiscal Hedge
Property tax appraisal growth caps (“5.5%” proposals in the 90th Session) could reshape local government fiscal capacity. This section models the impact:
- Property Tax Appraisal Growth: Model revenue impact of 5.5% appraisal cap on host jurisdiction
- Chapter 312/313 Strategy: Inventory existing abatement agreements, model Chapter 313 expiration impact
- Voter Sentiment Assessment: Track local ballot measures affecting tax policy
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Who This Checklist Is For
AI Data Center Developers
Evaluating Texas sites for hyperscale AI infrastructure. Understand foreign ownership restrictions, critical infrastructure scrutiny, and local fiscal dynamics.
Infrastructure Investors with Foreign Capital
Conducting due diligence on Texas data center projects. Identify SB 17 exposure, map beneficial ownership structures, and assess control test compliance.
Companies Navigating ERCOT + Property Tax Policy
Operating in jurisdictions affected by appraisal growth caps and tax abatement uncertainty. Model local government fiscal capacity and voter sentiment.
Legal & Finance Teams
Managing regulatory risk for AI infrastructure portfolios. Prepare for 90th Session proposals and evolving state-level scrutiny.
About JD Key Consulting
Led by James Dickey, former Chairman of the Republican Party of Texas, JD Key Consulting provides government relations services for businesses navigating Texas state and local government.
Our AI infrastructure practice helps investors and operators understand SB 17 compliance, anticipate legislative developments, and navigate local government approvals.
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