NORTH MANKATO — The North Mankato City Council continued discussions Monday on a proposed moratorium on large-scale data centers, reviewing potential size and water-use thresholds, environmental review, zoning and the scope and cost of a possible study.
Under the parameters discussed at Monday’s work session, the proposed moratorium would prohibit data centers larger than 150,000 square feet or using more than 50,000 gallons of water per day.
No official action was taken and a second public hearing and consideration of the proposed moratorium will come before the council in the coming weeks.
The discussion followed the council’s Aug. 3 meeting, when members tabled action on a proposed interim ordinance to allow additional research after about 40 minutes of public testimony. Nearly every speaker supported a temporary pause while the city studies how data centers should be regulated.
City staff have reviewed moratoriums adopted or being considered across the state and City Attorney Chris Kennedy said the definitions and thresholds vary among communities.
“One of the things that we want to do the moratorium for is to figure out exactly where particularly larger scale data centers fit in. We don’t really currently address data centers at all in the zone ordinance, whether they’re small or large,” Kennedy said. “What we want to be determined is how we want to define data centers.”
Finance Director Jessica Ryan said the data center study is not included in the proposed 2027 budget and that its cost could affect current levy scenarios. Staff does not have the resources to conduct the study effectively and an outside consultant could cost about six figures, said City Administrator Kevin McCann.
“If the council decides to proceed with a study, an estimated amount and scope will need to be established and incorporated into the proposed budget,” Ryan stated in the council packet materials. “Depending on the scope and cost, this could have a significant impact on the current budget and levy scenarios.”
The council also discussed the city’s Alternative Urban Areawide Review, or AUAR, which covers just under 700 acres, mostly outside the city limits and considers future technology center and warehouse and office development scenarios.
The approximately 500-page review addresses wetlands, soils, geology, endangered species, land use, contamination, ecological resources, water resources and historic properties and was at the center of a lawsuit brought against the city by the Minnesota Center for Environmental Advocacy, which claimed that internal city documents suggested the potential for a data center development in the area. The city said no data center was ever proposed, and the suit was withdrawn and dismissed in district court.
Following a public request to do so at the Aug. 3 meeting, Community Development Director Mike Fischer said rescinding the AUAR could limit future warehouse and office development in the study area, though he outlined an alternative in which the city could determine that large-scale data centers are not adequately covered by the existing AUAR and require additional environmental review while retaining the review for warehouse and office development and smaller data centers.
Fischer said the Minnesota Environmental Quality Board has no formal rule-based process for rescinding an AUAR, however, the city could discontinue its support through a local resolution.
Data centers are not specifically permitted in any North Mankato zoning district, and any proposed facility would not currently be permitted within the city. If the city decides to allow data centers, zoning amendments would be required, Fischer said, with public hearings before the Planning Commission and City Council.