Action aimed to protect Minneapolis resources is getting pushback from the business community working to boost a slumping downtown.
For the next five months, most data center projects in Minneapolis cannot move forward. The moratorium was passed by the council Thursday — those behind the pause feel this is a victory for residents and the city’s green spaces and vulnerable communities.
“Residents from all over Minneapolis have reached out to me, all of us, to tell us about the concerns they’re seeing from data centers,” council member Aurin Chowdhury, who helped lead this legislation, said.
“Water consumption, electricity use, noise pollution, impact on land use, where things can be built whether it’s housing, playgrounds, soccer fields,” Chowdhury added about the concerns they’re hearing about.
The time will allow council members to work on a policy for future data center project proposals, learn from city staff about the issue, and better understand the pros and cons at play.
Opponents of the pause point highlighted during the council meeting they don’t want to see green space developed into data centers, instead the focus right now is building this infrastructure in unused spaces downtown.
“This policy is by fear, not facts,” council member Michael Rainville, who represents parts of downtown, said during the meeting.
There is an exception built into the moratorium for certain developments downtown, but there’s still fear about the impact a ban brings.
“Even with a carve out for moderate projects downtown, we send a message to the business community,” council member Linea Palmisano said. “We send the message that they should take their business elsewhere, and guess what, they will.”
Proponents point to what they feel is a successful revamp of the decades-old data center at the city’s Sleep Number building downtown
The group behind that work, Virginia based Legacy Investing, says this action gives them hesitancy with future investments in the city, which includes $1 billion worth of data center projects ready to go for other locations downtown.
“Anytime something like this passes, we have to pause and evaluate what impact that has on future investments, just because it does, you know, does change the landscape a bit,” Daniel English, managing partner with Legacy Investing, told 5 EYEWITNESS NEWS.
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The downtown commercial building landscape is becoming more and more grim, dropping 45% in value since 2021 — in turn, putting more of the property tax burden on residents.
When questioned about jeopardizing any future economic development, given the city’s challenges, Chowdhury said easing the tax levy this budget season will be a priority while standing firm on their action on data centers.
“One thing I will say, that we hear over and over again, from this industry is there’s going to be these major benefits, it’s going to bring a lot of revenue, but we haven’t seen any proof of that and that’s what this research is going to show,” Chowdhury said.
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