Cleveland will likely hit pause on new data centers while the city draws up rules for the computing facilities at the heart of the artificial intelligence boom.
A City Council committee advanced a three-month moratorium after a hearing on Thursday that lasted a little more than two hours. The full council could pass the legislation as soon as its July 15 meeting.
The city wasn’t offering a firm yes or no to data centers in advancing the moratorium, Utilities Committee Chairman Brian Kazy said. Instead, the pause will give City Hall time to come up with a way to manage and evaluate data center projects, such as by size or environmental impact.
“Data centers are here,” Kazy said. “They’re probably not going anywhere any time soon. But what we need to figure out is, do we have infrastructure that’s going to support them?”
Council trimmed the moratorium down to three months from the original proposal, which would have paused data centers until May 2027.
The moratorium would also apply to data center expansions. It would not include companies that maintain in-house data centers, Kazy said. After three months, council would have the option to extend the moratorium. The pause could also end earlier once the city passes new data center rules.
A new chapter for an old manufacturing city
Thursday’s hearing offered an early look at how the political debate over AI data centers will play out in Cleveland, with its legacy as a hub for industry. The city has long been home to data centers offering storage and internet connectivity.
Adding urgency to the debate is a proposal for a large, 150-megawatt data center in Slavic Village, which appeared to catch public officials by surprise. Mayor Justin Bibb’s administration denied a permit for the project for now.
Tom Bullock of the Citizens Utility Board of Ohio, who described himself as neutral on the legislation, likened data centers to the railroads and steel mills of a century ago — the possible foundation for a growing U.S. economic competitiveness.
Ward 12 Council Member Tanmay Shah saw a more dire side in that comparison. He argued that Big Tech, not Cleveland, would benefit from new data centers in town.
“Those billionaire oligarchs like Bezos, Musk and Zuckerberg are dependent on these data centers to be put in our communities so they can continue extracting our money,” he said. “They’re actually the robber barons of our times.”
Shah questioned whether the city’s electrical grid, which has seen its share of power outages, could handle the increased demand brought by data centers. He unsuccessfully sought to extend the moratorium to six months, arguing that three months wasn’t enough time.
Council President Blaine Griffin said the city should include environmental protections in its new rules, such as minimizing how much water data centers use when cooling servers. On the other hand, the council president warned that he didn’t want to stiff-arm businesses.
“We do want to make sure that we get this right,” Griffin said. “But we also don’t want to say that Cleveland is closed for business.”
Building trades stick up for data centers
Construction trades workers — supporters of data centers who would be employed to build them — packed the committee room on Thursday. With the chairs filled, some workers stood in the back of the room, hard hats in hand.
Representatives from the International Brotherhood of Electrical Workers argued that data centers could be a boon to Cleveland.
“Cleveland needs an identity,” IBEW Local 38’s Mike Bremmer told council members. “It’s not steel. It’s not railroads anymore and it’s not auto. We could be the tech capital of the Midwest.”
Some council members said that data centers didn’t directly employ many workers besides those hired to build the facilities. To that, Jamie Davis of IBEW Local 38 said that the skills an electrical tradesman learns on a job help him to build a career.
On the other side of the argument, the liberal think-tank Policy Matters Ohio gave council pointers on how to rein in data center projects. Zach Schiller, Policy Matters’ research director, urged council to reject financial incentives for data centers and non-disclosure agreements with developers.
Non-disclosure deals “undercut local democracy by excluding residents from providing input on economic development decisions,” he said. “Officials cannot be fully accountable when they operate in secret.”
The city could also require new data centers to invest in upgrades to Cleveland Public Power, the municipal electric utility, Policy Matters researcher Molly Bryden said.
What’s next for data center regulations in Cleveland?
A working group will advise council and the Bibb administration on possible data center zoning rules. Kazy said he hoped the group would include both those “1000% for” and “1000% against data centers.”
Kazy said he expects the city to move quickly, with data center rules introduced to City Council by Sept. 14.
