By Roland Murphy for AZBEX
A City of Phoenix draft ordinance to curtail data center zoning has raised concerns in the City’s own Village Planning Committees.
A recent post on Rose Law Group Reporter explained City planning staff was directed to start drafting an ordinance on data center uses in December 2024, which included instructions for a final City Council vote before Council recesses this summer. The short timeframe came as a shock to the development community and the City’s Village Planning Committees.
The draft ordinance was produced in late April and is scheduled for a Council vote June 18. RLGR said, “…this is possibly the fastest the City of Phoenix has scheduled a land use ordinance of this caliber for passage. Additionally, there was an unusual structure that scheduled the stakeholder engagement meetings for after the data center ordinance draft had already been produced and Village Planning Committees began voting. No redrafts incorporating stakeholder and Village Planning Committee input have yet been produced.”
The usual process for drafting a major land use change ordinance includes presentations to the Village Planning Committees and multiple public and stakeholder engagement sessions. It often takes more than a year of back and forth before a final draft is ready for a City Council vote.
Background
The proposed ordinance would restrict data center development to areas zoned for industrial and limited commercial uses and require securing a Special Use Permit.
Data centers would also have to undertake noise mitigation if they are within 300 feet of residential areas, be located more than half-a-mile from high-capacity transit and incorporate decorative design features to avoid “monotonous, undifferentiated surfaces,” according to the staff report.
Phoenix Mayor Kate Gallego and some other local leaders have expressed concerns about data centers’ power usage and perceived negative impacts to surrounding areas, including noise pollution, unattractive aesthetics, low post-construction job creation numbers, and impacts on walkability and neighborhood vibrancy, according to a recent article on Axios. (AZBEX, May 21)
These concerns come despite Phoenix ranking as a national leader in data center development. Within the city limits, there are currently eight data center projects in various stages of design and planning or under construction, with a total estimated construction valuation of more than $4B, according to the DATABEX project database. Four more projects valued at $2B have been delivered.
In her May 20 State of the City address, Gallego went a step further and called on the Arizona Legislature to eliminate tax incentives for data centers, calling the development incentivization “antiquated.” She also showcased the rezoning attempt as an effort to “set guidelines to support intentional growth.”
Rapid Pace Creates Pushback
RLGR reports, “Following data center stakeholder and citizen input at Village Planning Committees, the results have shown that nine out of 14 Village Planning Committees that voted on the issue passed their recommendations with a request for a 60–90-day period for stakeholder input to redraft the ordinance before a final vote by Council.”
Reasons given for the requested lengthening of the drafting and comment period include concerns about vague language, moratorium issues, protecting existing project investments, and development standards for the zoning districts under the permit.
Just four Village Planning Committees voted to approve the ordinance in its current state.
The RLGR post concluded by saying, “While the reasoning for the Village Planning Commission’s recommendations is varied, the message they’ve made is clear: the proposed City of Phoenix data center ordinance needs more work, more time, and more input before final implementation.”