Council Advances Data-Center Rules With Second Reading, Weighs Possible Moratorium

Today's news becomes tomorrow's history. Help us record it. DECORAH — The Decorah City Council unanimously advanced new zoning regulations for data centers Monday, Oct. 5, even as council members raised a larger question: Should the city temporarily halt data center development while communities across Iowa determine how to regulate the facilities? The council approved the ordinance on second reading, moving forward a set of regulations that would allow data centers and cryptocurrency mining operations in the city's M-3 General Industrial District. The proposed ordinance establishes standards addressing utility capacity, water consumption, environmental protection, setbacks, noise, emergency response, site security, construction impacts and eventual decommissioning. The vote did not approve a specific data center project. Rather, it advanced a zoning framework that would govern future proposals within city limits. Discussion shifted toward the possibility of a temporary moratorium when Council Member Steve Zittergruen questioned whether Decorah should allow data center development while other communities continue evaluating the industry's potential effects. Zittergruen acknowledged that the proposed regulations establish significant protections but expressed concern about whether a "small city" such as Decorah has the staffing and resources necessary to evaluate a project proposed by a company prepared to invest hundreds of millions of dollars or even $1 billion. He suggested a temporary moratorium could give the city time to observe how other municipalities approach data center development, evaluate the effectiveness of their regulations and determine whether additional safeguards are necessary. City Manager Travis Goedken said he attended the Winneshiek County Board of Supervisors meeting at which supervisors unanimously approved a 12-month moratorium on data centers Sept. 30. "Their subcommittee that's working on it has asked me to attend some of their meetings, so I'll be attending those as well," Goedken said. Goedken also noted that county zoning regulations do not apply within municipalities that have their own zoning authority, meaning the county's moratorium does not automatically extend to Decorah. "That's going to limit it to Decorah, Winneshiek County, unincorporated areas and maybe Calmar," he said. The distinction leaves the city and county pursuing separate approaches to potential data center development. Mayor Andy Carlson also expressed interest in discussing a possible moratorium, saying he would be "interested in having a conversation." Council Member Emily Neal said she supported establishing regulations but questioned whether a moratorium would withstand a legal challenge. She also questioned whether a moratorium would accomplish much beyond signaling to prospective developers that "we're not really wanting you here." "The truth is, I do not want a data center in Decorah that isn't literally in a very closed loop system and has zero impact on the people and the environment," Neal said. "I'm happy to pass a moratorium, I just don't think that they hold up in court." Neal also raised the possibility of state intervention, suggesting Iowa lawmakers could eventually establish uniform requirements for data centers regardless of local regulations or moratoriums. She expressed concern that the state could tell local governments "what they did wrong" and establish new requirements governing data center development. "I do think we're going to see something handed down from the state on how every city is going to have to handle data centers," she said. Despite the discussion, the council proceeded with the ordinance's second reading without taking separate action on a moratorium. The second-reading approval moves Decorah closer to establishing a formal regulatory framework for data centers, although the ordinance has not yet received final approval. Although council members agreed to advance the regulations, the discussion left open whether those rules alone are sufficient or whether Decorah should join Winneshiek County in temporarily halting data center development. The stories that matter to you, delivered straight to your inbox. Subscribe for free.