The proposed bill, known as the "Data Center Community Benefit Act," mandates that certain data centers in Michigan must enter into community benefit agreements with local governments or community stakeholders before beginning construction or operation. These agreements are binding legal contracts that require data center owners or operators to provide resources that benefit local community interests. The bill outlines the definitions of key terms, including "data center," "community benefit agreement," and "local unit of government," and establishes the process for reviewing and approving these agreements.

Under the bill, data center operators must submit an application for a community benefit agreement to the local government, which has 90 days to approve or deny the application. Approval is contingent upon the agreement benefiting public health, safety, and welfare. Additionally, local governments have the authority to deny permits or other authorizations for data centers if a community benefit agreement has not been approved. The Michigan Public Service Commission is also granted the power to create rules to implement the provisions of this act.