NORTH MANKATO — A lawsuit challenging the city of North Mankato’s handling of an environmental review tied to a proposed industrial development has been voluntarily dismissed by the Minnesota Center for Environmental Advocacy, according to a statement released Monday by the city.
City officials said the dismissal affirms the Alternative Urban Areawide Review, or AUAR, process used for the proposed “North Mankato Industrial” development area, which had drawn scrutiny and public opposition over speculation the site could eventually house a large-scale data center.
“The City believes the voluntary dismissal vindicates the AUAR process the City followed,” the statement said.
The Minnesota Environmental Quality Board oversees the AUAR process and approved the procedures used by the city in connection with the study, according to North Mankato officials.
The lawsuit, filed in 2025 by the Minnesota Center for Environmental Advocacy, alleged the city violated Minnesota environmental law by using an AUAR in a way that obscured the true scope of a potential project tied to the site. Environmental advocates argued internal communications referenced a possible hyperscale data center campus with significantly higher power demands than what was publicly modeled in the environmental review.
At a public forum in Mankato earlier this year, attorneys with MCEA said the case centered on transparency and whether the environmental review adequately studied potential impacts related to energy use, water consumption and emissions.
North Mankato officials reiterated Monday that no formal data center proposal was ever submitted to the city and that no such project is currently planned.
The AUAR, initiated and funded by Project Deacon LLC and prepared by consulting firm Kimley-Horn, evaluated potential future industrial uses on privately owned land in nearby Belgrade Township. The review studied two general scenarios: a technology park and office or warehouse development.
City officials emphasized the AUAR itself does not approve any project or development.
“It is important to understand that an AUAR is only a study,” the city said in the release. “It does not approve a specific project and does not mean anything is planned or moving forward.”
Officials added that if any future proposal exceeds assumptions outlined in the AUAR, additional environmental review would be required before development could proceed.
The city also said there is currently no active development proposal for the area, though North Mankato “continues to be open to new business and industry that may be looking to locate to the community.”
You can reach Robb at (507) 344-6382, or rmurray@mankatofreepress.com.