Kalamazoo City Commission passes one-year data center moratorium

Late Monday night, the Kalamazoo City Commission approved a one-year moratorium on the acceptance and processing of applications for data centers, battery energy storage systems, cryptocurrency mining centers, and artificial intelligence data centers. 

Commissioners unanimously approved the resolution on August 17, about four and a half hours into their meeting. Public comment lasted almost three hours, with residents largely voicing opposition to potential data center developments in the city. 

The moratorium is scheduled to last until August 16, 2027, and temporarily pauses the city’s acceptance or processing of applications for the four types of facilities. 

It could end earlier if new or amended city regulations take effect, and the City Commission can extend it by resolution if more time is needed to complete those changes. 

The resolution states, in part, “The City Commission hereby imposes a temporary moratorium on the acceptance and/or processing of any applications for a data center, battery energy storage systems, cryptocurrency mining center, and AI data center.”

City staff identified potential concerns including noise, water and energy use, environmental impacts and fire risks, and said Kalamazoo’s existing zoning rules do not adequately address the facilities.

The moratorium comes amid growing data center development nationally and closer to home. The city’s agenda report cites an increase in proposed data centers and battery energy storage systems in Kalamazoo County and elsewhere in Southwest Michigan. 

Locally, debate has centered on Harbor Farmz, a Kalamazoo-based cannabis company that is selling its facility at 2839 Full Circle Drive and marketing the property for potential redevelopment as a data center. Company representatives at Monday’s meeting urged commissioners not to adopt the moratorium. 

City Attorney Aaron Leal said no development application for the Harbor Farmz property had been submitted to the city as of Monday’s meeting.

“This was zoned for cannabis for industrial use and this building is in what would be a prime location to be a data center to allow for the economic development and for our team to transition our facility, remain in Kalamazoo, and keep all of our employees employed,” Harbor Farmz facility director Nick Briggs said.

During commissioner discussion, Vice Mayor Drew Duncan said Harbor Farmz had not been profitable and argued that residents should not be responsible for making the business financially viable. Duncan said he and other commissioners visited the facility earlier that day and spoke with its operators.

“According to staff we talked to today, they have not turned a profit in the entirety of the six years they have been in the location,” Duncan said.

Duncan said he opposed putting the public in a position to make a struggling private business financially viable and said the moratorium would give commissioners time to answer outstanding legal, health, and environmental questions.

Commissioner Jeanne Hess expressed hesitation about the moratorium, saying she was “torn” but that the “public has spoken.” Hess said she would vote in favor of the measure “with apologies” to the roughly 30 Harbor Farmz employees who could be affected.

Commissioner Chris Praedel focused on the property’s location and its proximity to residential neighborhoods.

“We’re talking about a facility that’s effectively sandwiched in between the two most populous neighborhoods of our 22 neighborhoods in the entire city of Kalamazoo. It’s not a cornfield in the middle of Schoolcraft,” Praedel said. 

City Attorney Aaron Leal described the moratorium as a stopgap while the city considers longer-term regulations. Under the resolution, city staff, the city attorney, and technical consultants, if needed, will review land use, infrastructure, environmental, public safety, and other regulatory issues associated with the facilities. Staff are directed to present proposed zoning ordinance amendments for consideration before the moratorium ends.

Maxwell Knauer is a staff writer for Watershed Voice.