Microsoft Ends Secrecy Deals With Local Governments on Data Centers
Move follows growing backlash in Wisconsin and elsewhere over nondisclosure agreements on major projects.
People attend a Microsoft announcement about a data center Thursday, Sept. 18, 2025, in Racine, Wis. Angela Major/WPR
Microsoft will no longer use nondisclosure agreements with local governments in developing data centers, the company announced this week.
The company had previously used nondisclosure agreements, or NDAs, during the early stages of data center development. Microsoft says it did so to “protect sensitive commercial information.”
Using NDAs with local governments is a fairly common industry practice early in developments. For example, Beaver Dam, Kenosha, Janesville and Menomonie all signed NDAs related to potential data center projects, according to Wisconsin Watch.
Most recently, the town of Beloit became the fifth Wisconsin community with an NDA for a possible data center.
Kenosha signed an NDA with Microsoft in May 2024, Wisconsin Watch reports.
But by definition the practice keeps information from the public, and the agreements with Microsoft and others have come under fire as backlash against data centers has grown.
According to Microsoft’s announcement, the company is working to identify active NDAs in place and to reach out to local governments to terminate those agreements.
Rima Alaily, corporate vice president and general counsel of Infrastructure Legal Affairs at Microsoft, said on social media that the company would continue using NDAs in connection with land acquisitions.
But she said the decision to no longer use nondisclosure agreements with local governments is aimed at “strengthening public trust.”
“Our neighbors deserve to know when we are coming to their community,” Alaily said. “They deserve transparency about what we are building and why.”
Microsoft declined to provide an interview for this story.
A bill in the state Legislature would have banned local governments from entering into nondisclosure agreements with data center developers that hide details of those developments from the public.
State Sen. André Jacque, R-New Franken, introduced the bill in the Senate. In a statement last week, he said the proposal would’ve ensured that projects seeking local approval do so openly.
“When a large data center is built, it reshapes the community and carries real fiscal consequences for taxpayers,” Jacque stated. “Residents are concerned about noise levels, environmental impacts and infrastructure costs and how the project will affect the quality of life.”
That bill passed 4-1 in the Senate’s utilities committee, but failed to advance before the legislative session ended this week.
Bill Lueders, president of the Wisconsin Freedom of Information Council, said it’s a good thing Microsoft will no longer use nondisclosure agreements with local officials.
He said data center developers’ use of NDAs in Wisconsin did “blow up in their faces” and contributed to projects facing increasing backlash.
“Communities don’t like it when they find out that their public officials are meeting secretly with representatives of companies to change the character of their communities,” Lueders said. “I’m also not surprised that a company like Microsoft would take a look at it and say, ‘Boy, that’s really not a good look.’”
Data centers aren’t the only type of development where local governments enter into NDAs.
Regardless of how they’re used, Lueders said he’s not a fan.
“I think it’s a bad idea whenever they’re applied,” he said. “You’re swearing public officials to secrecy. You’re saying that you agree not to talk about what is being discussed here as a condition of having a discussion with you at all.”
Microsoft to stop using NDAs with local governments for data center development was originally published by Wisconsin Public Radio.
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