Activists, city planners dissatisfied with Minneapolis City Council's vote on data center regulations

The Minneapolis City Council’s recent vote on data center regulations has left stakeholders on both sides feeling less than satisfied, highlighting a deep divide over the city’s approach to attracting investment while addressing environmental and community concerns. The council narrowly passed an ordinance Thursday, setting limits on where data centers can operate and requiring full council approval for new projects, but falling short of a complete ban championed by some members. This development follows a six-month moratorium on data center construction, set to expire on November 21, and comes as Minneapolis grapples with 9 million square feet of vacant office space.

What Happened

The Minneapolis City Council approved a new ordinance regulating data centers in a 7-6 vote on Thursday. The ordinance limits data centers to two downtown zones, requires them to be located in existing buildings, and mandates full council approval for any new construction. A previous attempt to enact a full ban on data centers failed. The ordinance now moves to Minneapolis Mayor Jacob Frey for his approval, which is required for it to become law. Council members who voted in favor included Elliott Payne (Ward 1), Aisha Chughtai (Ward 10), Robin Wonsley (Ward 2), Soren Stevenson (Ward 8), Jason Chavez (Ward 9), Jamison Whiting (Ward 11) and Aurin Chowdhury (Ward 12). Council members who voted against the ordinance were Jamal Osman (Ward 6), Michael Rainville (Ward 3), LaTrisha Vetaw (Ward 4), Pearll Warren (Ward 5), Elizabeth Shaffer (Ward 7) and Linea Palmisano (Ward 13). Residents can view the full council meeting City Council Meeting Minutes.

The proposed regulations include several key stipulations. Data centers are restricted from being the primary use of a building and cannot be located on the first or second floor. Those exceeding 50,000 square feet will be required to participate in a program with Xcel Energy, contributing to renewable energy development through the purchase of renewable energy credits. Council member Aurin Chowdhury explained that this program aims “to build out renewable energy in the large grid through the purchase of renewable energy credits.” Furthermore, a sound attenuation plan is mandatory, and data centers must submit a decommissioning plan in case of closure. The ordinance also mandates disclosure of energy, water, and generator usage. The current moratorium on data center construction is scheduled to expire on November 21, creating a sense of urgency around the ongoing debate.

Economic Context and Vacant Office Space

The move comes as Minneapolis seeks solutions for its significant amount of vacant office space and grapples with a need to bolster the city’s tax base. Supporters of data centers argue they offer a pathway to adaptive reuse of existing buildings and job creation. Dan McConell of the Minneapolis Building and Construction Trades Council stated, “We've got a city that's got 9 million vacant square feet of office space… I’m a taxpayer in the city of Minneapolis. I think that we're looking at a double-digit tax increase.” He emphasized the need for investment to revitalize the city and attract further economic activity.

Community Reaction and Concerns

The approved ordinance hasn't satisfied everyone. Kalani Matus of the Climate Justice Committee expressed skepticism about the regulations' effectiveness, citing a history of lax enforcement of environmental rules by the Minnesota Pollution Control Agency. “There's a long history of rules and regulations not being followed up on,” Matus said. He voiced concerns that the city will fail to adequately monitor and enforce the new data center regulations, mirroring past issues with other industrial polluters. Council Member Elizabeth Shaffer echoed this sentiment, questioning whether smaller data centers would truly provide a significant economic boost. “Will small-scale data centers be a cure-all for revenue generation? I’ve already said no,” she stated.

Key Dates and Future Actions

Timeline

The timeline surrounding the data center regulations is crucial for understanding the current situation and potential future developments. The current moratorium on data center construction expires on November 21. The approved ordinance now goes to Mayor Frey for his approval, which is required for it to become law. Council Member Soren Stevenson indicated that if a full ban fails again, proposals for overlay zoning—allowing case-by-case public hearings—will be revisited. He stated, “If a full ban fails again tomorrow, we will bring back a proposal that includes overlay zoning again as well.”

The Backstory: Current Data Center Landscape

Minneapolis currently has eight data centers serving tech companies downtown, with many more serving onsite computing needs of existing businesses throughout the city. City staff estimate there is interest in up to eight more data center projects downtown. This influx of potential data centers has fueled the debate over their impact on the city’s infrastructure, environment, and economy. Xcel Energy has reportedly expressed interest in these potential projects, leading to concerns about increased energy demands and the need for renewable energy solutions.

Specific Ordinance Requirements

The approved ordinance outlines several specific requirements for data centers operating in Minneapolis. These include a maximum size limit of 150,000 square feet when using renewable energy or up to 50,000 square feet for non-renewable energy sources. According to the city council, data centers cannot be the primary use of a building. A key component is the requirement for a decommissioning plan to ensure responsible closure and environmental remediation if a data center ceases operations.

Marcus's Perspective: A Cautious Approach Needed

The Minneapolis City Council’s compromise on data center regulations feels like a band-aid on a deeper wound. While the restrictions on size, location, and energy usage are a step in the right direction, they don’t address the fundamental questions about whether large-scale data centers are truly compatible with the city’s long-term goals. The promise of revitalizing vacant office space is alluring, but it shouldn't come at the expense of environmental sustainability and community well-being. The fact that even those who voted for the ordinance aren’t entirely satisfied speaks volumes about the complexities of this issue. Families in Edina and across the metro area should pay close attention to how these regulations are implemented and enforced, and demand accountability from city officials.

Resources for Further Information

For those seeking more information about data centers in Minneapolis and the city’s regulations, several resources are available. The City of Minneapolis website https://www.minneapolismn.gov/ provides access to council meeting minutes, ordinances, and related documents. The Minneapolis Building and Construction Trades Council Minneapolis Building and Construction Trades Council advocates for skilled trades workers and offers insights into the potential economic impact of data centers. Xcel Energy https://www.xcelenergy.com/ is the primary energy provider for Minneapolis and can offer information about energy usage and renewable energy initiatives. The Climate Justice Committee Climate Justice Committee advocates for environmental justice and provides a critical perspective on the potential impacts of data centers.

These regulations are a reminder that balancing economic development with the needs of families and communities requires careful consideration and ongoing vigilance. Strong communities are built on a foundation of responsible planning, sustainable practices, and a commitment to the common good. As Minneapolis navigates this evolving landscape, it’s imperative that residents remain engaged and advocate for policies that prioritize the long-term well-being of the city and its families.

The decisions made today will shape the future of Minneapolis for years to come. It is a time for careful reflection, open dialogue, and a renewed commitment to creating a thriving and sustainable community for all.