Minneapolis City Council approves 5-month pause on data center development

Minneapolis City Council members approved a five-month pause on new data center development Thursday.

The moratorium does not apply to smaller data centers located downtown that are less than 350,000 square feet.

The Minneapolis City Council voted to temporarily halt new data center projects while city staff study regulations and examine concerns about environmental impacts, energy use and public safety.

The vote comes as opposition to data center projects has surfaced in communities across Minnesota.

In Elk River, Minnesota, this week, the city’s planning commission recommended against a proposal that would pave the way for a data center, despite the fact advocates said the project could generate an estimated $800,000 in additional revenue.

In Inver Grove Heights, Minnesota, a packed city council meeting erupted in boos after officials delayed a final vote on a proposed data center. The vote is now scheduled for Friday.

The issue has drawn strong opinions in Minneapolis.

At a Minneapolis committee meeting last week, a vocal majority spoke out in favor of the pause. Labor groups highlighted the construction jobs data centers can provide, while residents raised concerns about neighborhood impacts and whether the facilities would benefit local communities.

Councilmember Soren Stevenson said residents throughout Minneapolis have been clear in their opposition to additional data center development.

“My constituents and people from across this city are so, so clear that they don’t want data centers at all,” Stevenson said.

Supporters of the moratorium said the temporary pause will give city officials time to study the industry and develop regulations before additional projects move forward.

Council Member Aurin Chowdhury argued that data centers have had disproportionate impacts.

“That industry has shown over and over again negative impacts, especially in communities of color and communities that have been impacted by environmental injustice,” Chowdhury said.

Opponents of the pause warned the move could discourage future investment in Minneapolis and send the wrong message to businesses considering projects in the city.

Councilmember Linea Palmisano said the moratorium could undermine efforts to attract economic development at a time when residents are facing higher property taxes.

“We send a message to the business community that they aren’t important or supported by this council,” Palmisano said. “We send the message that we don’t want their investment.”

The measure now heads to Mayor Jacob Frey, who plans to spend the next several days reviewing the ordinance before deciding whether to sign it, a spokesperson said.