Minneapolis City Council to Vote on Downtown Data Center Limits

Facing a looming expiration on a temporary development pause, the Minneapolis City Council is scheduled to vote on Thursday on an ordinance that would restrict new data centers to existing downtown structures and cap their server floor space.

City leaders agree that the facilities need oversight, but they remain deeply divided over how strict those rules should be. MPR News reported that while some council members pushed for an outright ban or individual council approvals for every project, those progressive measures failed on a 6-6 vote on Monday.

The debate comes as communities nationwide grapple with the massive utility usage, noise pollution, and secretive deals associated with large-scale computing infrastructure. MPR News said that the city received about 1,600 written public comments on the potential rules, with the vast majority opposing data centers and nearly half calling for a full ban.

Minneapolis City Council wants to subpoena Frey and his staff https://t.co/2xuMTCU10k

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Conversely, proponents of data center development argued it can bring in needed jobs and tax revenue to communities. Proponents argue that the facilities bring much-needed construction jobs and tax revenue to the area while supporting cloud storage and artificial intelligence computing demands.

“Look around our city. We do not see cranes. We are not building, and our construction trades need work,” council member Elizabeth Shaffer told MPR News, “Do data centers drive a lot of permanent jobs? No. Do they drive more jobs than vacant space? Absolutely,” council member Elizabeth Shaffer told MPR News, adding that while the centers do not generate large numbers of permanent jobs, they drive more activity than vacant space.

The city’s committee of the whole discussed the proposed ordinance for over two hours on Monday before unanimously forwarding it to the full council, according to CBS News. The debate follows a five-month pause on data center development that the City Council approved on June 25 to examine environmental, energy, and public safety concerns. That moratorium expires on Nov. 21.

Under the compromise proposal advanced on Monday, new data centers would be limited to buildings existing on Jan. 1, 2027, and restricted to downtown. The measure sets a server floor area cap at 150,000 square feet—sitting between city staff recommendations of 175,000 square feet and the planning commission’s stricter 50,000-square-foot limit.

Minneapolis City Council to Vote on Downtown Data Center Limits — Photo: cbsnews.com

CBS News reported that any facility establishing up to 150,000 square feet of white space—the floor area dedicated to servers, IT racks, power systems, and air conditioning units—must subscribe to a renewable energy rate option from the local utility service provider as an incentive for clean energy deployment. The ordinance also requires a sound attenuation plan to address equipment noise.

A potential mayoral veto hung over Monday’s committee meeting, with council members pressing Mayor Jacob Frey for clarity. Council member Linnea Palmisano told colleagues that Frey does not support the planning commission’s tighter amendments and would veto them if included.

“Mayor Frey does not support the planning commission’s amendments. If those are included in the final package, he will veto it,” Palmisano said.

If the council fails to pass new rules before the moratorium expires on Nov. 21, data centers will revert to the existing zoning code, which allows them with a permit in 10 of the city’s 15 zoning districts. The full council meets on Thursday to take up the final vote.