Lubbock's City Council passed a resolution Tuesday expressing that it would not consider any large-scale data center developments until after the city has adopted regulations to protect residents and resources.
The resolution was put forward by District 6 city council representative Tim Collins, who said these kinds of regulations are within its jurisdiction and aligned with state law.
"And the way that we can control these things comes through Planning and Zoning," Collins explained. "We don't have the wherewithal throughout the legislative environment to make a lot of restrictions, but this is the one place where the Legislature gives us control, in zoning ordinances."
Collins clarified that the current resolution is temporary, while the city council works toward a set of standards with which developers will have to comply.
"I'm not gonna say that we would never consider a data center within the city limits of Lubbock," he said. "But I will tell you that we will have handcuffs. We will have the very things that you folks have asked for. We're gonna know and have responsibility and repercussions of those handcuffs."
This vote is separate from the consideration of an 18-month moratorium on data centers, which was put forward by citizens and is expected to be formally considered later in September.
Mayor Mark McBrayer reminded those at the meeting that, as it was written, the motion from the council is not binding, but rather "expresses the intent" of the council to regulate large-scale data centers in Lubbock city limits.
"It doesn't have enforceable mechanisms to it, but we are continuing to work on an ordinance that will have those teeth in it," McBrayer said.
A presentation of potential regulations from city staff came two days later at a special meeting of Lubbock's Planning & Zoning Commission.
Assistant City Manager Erik Rejino said the proposed regulations came from information gathered with the city's public survey ahead of the city council's special meeting at the Civic Center in July, as well as input that more than 60 citizens provided in that meeting. Rejino noted that the proposal serves as a framework for the commission to build regulations that would align with the plans of the city council to address citizens' concerns.
"They adopted a resolution expressing the desire of the city council that no large-scale data centers locate in Lubbock until adequate regulations are in place," Rejino said. "That's why we're here today."
These regulations would take the form of amendments to the city's Unified Development Code, including requirements for noise, air quality, water and power use, and two public hearings before approving any large-scale data center. Rejino said right now, large-scale data centers can be built in light and heavy commercial zones as well as light and heavy industrial zones. Part of the suggested changes would limit large data centers to only industrial zoning with a "specific use."
"That would basically require that it come to this body, a large-scale data center that meets the definition that y'all ultimately land on, comes to this body for a public hearing and goes to the council for consideration as well," he told the commission. "So, trying to give this body and the council a little more authority as it relates to large-scale data centers, in an attempt to address some of the concerns we've heard."
According to the city, the public survey that saw more than 1,500 responses found water use and energy use as the two greatest concerns of Lubbockites when it comes to the impact of large-scale data centers.
As it stands, the city is suggesting a definition of "large-scale" as data center facilities that use 75 megawatts and/or 100,000 gallons of water per day.
The proposed amendments would require large data center facilities to use closed-loop cooling, air-dry cooling systems, or similar technologies that "minimize" continuous water use. Developers would also be required to report total water consumption at full build-out as part of the application, and those using 100,000 gallons per day or more would be required to pay a "water reservation fee" that could be credited back at close or lost if the buyer does not close.
Current code already requires facilities with on-site generation to obtain special use permits, but as large data centers are designed to grow in scale, the proposal called for data center facilities that exceed "10% of the electrical load or water usage" defined in their original application to apply for another special use permit through the Planning and Zoning Commission.
The proposal included requiring data center developers to undergo a power usage study from a licensed engineer demonstrating the type of generation used for the project. According to the city, no other land uses require this kind of power use study to receive a special use permit.
Drew Gray, director of development with the real estate developer Stellar Family of Companies and member of the Planning and Zoning Commission, remarked that studies like these have been a deterrent in his own experience.
"To require feasibility studies of this magnitude, I know those are expensive, and I think that is a real risk to deter future development," Gray said. "I've done development in other states, other places that have required some level of this, and it's a huge deterrent."
At the same time, Gray said regulations designed to protect Lubbock's resources like water and power should potentially apply to more than just large-scale data centers.
"I think 'large power users' or 'large water users' needs to be the definition. I don't understand or appreciate maybe why this is limited to just data centers. I think these certain requirements or feasibility studies should be in place for anybody that could impact our resources, and so I know I'm kind of talking out both sides of my mouth," he said.
Gray asked for an enhanced definition of how the studies must be completed, and what those studies would require.
"How we move forward, how these data centers can progress, needs to have more surety, and they need to have the ability to understand if they hit these requirements, they can keep moving forward, and there's not uncertainty," he explained. "I just know these power studies and these water studies, when they're done correctly by the right groups, are millions of dollars, and I think that's a pretty large burden for someone to put up front without even knowing if they do that and they do meet those requirements, that they'd be able to move forward."
During the citizen comments portion of the public hearing, Mont McClendon, a business lawyer and general counsel for McDougal Companies, offered his own suggestions to the Planning and Zoning Commission around the city's proposed amendments. McClendon said trying to regulate things like air quality through planning and zoning could leave the city with legal issues without a way to enforce those regulations.
"I absolutely think that the city should and must continue to monitor operations of uses in their city. But when you purport to tie something post-development after a vested use right in zoning to operations further down the line, you are begging the city to become embroiled in litigation," McClendon said. "That operations piece belongs somewhere else. It belongs in a development agreement; it belongs in an ordinance otherwise, so that the city can come and enforce those things, other than by saying we're taking away your zoning."
McClendon remarked that many data center developers are looking to rural areas for building their facilities because of these kinds of regulations, and creating a situation that discourages data center developers from ever coming to Lubbock potentially negates the benefits that regulations provide, as well as the data centers' possible tax contributions.
"It is my understanding that if you use the resources at the Texas Tribune or many of those sites online to look at projects like this across our state, you will find, I believe, that almost none of them want to be in city limits. They want to be out in the county where they're not regulated like this," McClendon said.
Another member of the commission and project manager with architectural firm Parkhill, Tarek Redwan, pushed back on this, saying the city's ability to offer power and water offsets resources that developers would have to find themselves on rural property.
"Having some regulations in the city is not going to just push them out in the county," Redwan said. "The city also offers some stuff that the county does not. They have water. They have electricity. They have stuff like that that data centers can use in the city that they'll have to build in the county in order to develop up there."
Robert Wood, a custom homebuilder and member of the Planning and Zoning Commission, raised the point that the acreage required to build a large data center with the room to scale outward likely doesn't exist within city limits at this time.
"That's why I asked the question originally about how much room we actually have in the city limits to put one of these, and are we willing to go annex it? Because I think there's a huge economic positive for the city to have it in the city rather than in the county," Wood said. "And we do lose control, because they go out there, they build this facility, they're pulling water out of the ground. Nobody's really watching them, and we don't get the revenue."
While the proposed regulations were structured to give a public board like the Planning and Zoning Commission, and by extension, the citizens, an overview of how these facilities could grow and draw more resources in the process, Wood agreed that the governmental red tape in the city's proposal could serve to push developers away.
"Let's get the rules right, so when they bring it, staff can just do it instead of going back through it again. It's like when I go pull a permit on a house, or we're doing a development, it doesn't come through here, right? We take 150 acres and put houses on it. There's a rule. Let's make the rules and get them done, and we wouldn't have to do this all the time," he said.
Wood suggested that the regulations should be more clearly defined before they are recommended to the city council.
"I think there's some other things that need to be discussed because, to my point, and everybody else's point, if this is what we adopt, we will never see a data center in the city limits of Lubbock," Wood said.
Members of the Planning and Zoning Commission decided to discuss potential changes to the language and constraints of the amendments in a work session at the commission's Oct. 1 meeting. The Commission will then vote on a recommendation at its meeting on Nov. 5.
If approved by the Planning & Zoning Commission, the recommendations will move to Lubbock's City Council for final approval.
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