First posted on Instagram
Days after defeating Governor Greg Abbott in the Texas governor's race, Governor-elect Gina Hinojosa told CNN on Thursday that Texas must stop approving new data centers until lawmakers put protections in place for residents — and warned that Elon Musk's companies, which employ around 21,000 Texans, will have to deal with her administration on its terms.
"We will have laws to protect Texans, and we need to stop what we are doing with data centers until we have those protections," Hinojosa said. "It is not that I hate data centers. I hate the way they are taking advantage of Texas, and that stops when I'm governor."
Asked whether Musk might move his businesses out of Texas, Hinojosa said: "We can have a strong working relationship with Elon Musk and his companies, but it has to be on our terms. It cannot be just running over the people of Texas."
The warning lands after an election in which Musk spent heavily on the losing side. Musk directed at least $225 million of his midterm spending to Texas, according to OpenSecrets data reported by NPR, including $158 million promoting Republican U.S. Senate candidate Ken Paxton alone, according to Reuters. Democrats won the governor's race, the U.S. Senate seat — James Talarico defeated Paxton — and control of the Texas House.
Musk's footprint in Texas is vast: Tesla's headquarters and Gigafactory in Austin, SpaceX's Starbase launch site on the Gulf Coast, and operations for X, xAI, the Boring Company and Neuralink. His companies reportedly employ around 21,000 Texans across Austin, Starbase and SpaceX. Musk moved his businesses to Texas to escape what he has described as California's oppressive state government.
Musk answered the Democratic sweep on X overnight, writing: "Data centers in space looking pretty appealing right now."
Hinojosa has also taken aim at the incentives behind Musk's expansion. She has called for a special legislative session to end tax breaks for data centers and has asked Governor Abbott to issue an executive order halting new construction before she takes office on January 19. The incentives in question include SpaceX's Terafab chip plant in Grimes County, which received about $1.66 billion in school tax breaks while being required to create only 80 jobs.
She has separately sued Abbott for unredacted access to more than 1,100 pages of his communications with Musk, after the governor's office released the records almost entirely blacked out. And she has opposed handing public beach land at Boca Chica to SpaceX, telling CNN: "Selling our beach to Elon Musk is just something that is almost unimaginable. It's unacceptable."
Hinojosa said communities must have a say when large projects arrive in their areas, with union labour, a share of the decisions on sites, and guarantees that households do not pay more for electricity or water. "Different communities have different needs," she said. "And those communities have to be able to walk away from the table to leverage what they need for their communities."
For now, nothing has changed in law: the moratorium and the end of data-center tax breaks both need the Legislature, which opens a week before she takes office. But the message from the governor-elect is that the terms under which Musk's companies operate in Texas are about to be renegotiated.