The Birmingham City Council heard statements for and against a proposed ordinance to regulate data centers during its Tuesday meeting.
The meeting saw city officials explain the draft ordinance and community members speak both for and in criticism of the proposed regulations.
Although the ordinance was scheduled for a vote during the meeting, the council ultimately opted to delay a vote on whether to adopt the regulations to consider potential amendments based on public comments heard during the meeting.
Kim Speorl, zoning administrator for the Birmingham Department of Planning and Permits, and Hunter Garrison, deputy director of the Mayor’s Office of Resilience and Sustainability, presented an outline of the ordinance to the council.
“Prior to this AI revolution that we find ourselves in, data centers were typically smaller, housing local data and servers,” Garrison said. “Now we’re seeing vastly increased computing power, and alongside that, the footprint and impact of these data centers have increased. So, we recognize the need to create regulations around that.”
Garrison said most existing data centers in the Birmingham area are around five megawatts or less. Emerging large and hyperscale data centers, meanwhile, can use between 200 and 1,200 megawatts.
He went on to highlight that some hyperscale data center developments have seen “considerable community pushback or controversy” and, “in worst-case scenarios,” the facilities have led to decreased air quality, lowered property values and increased energy bills in surrounding communities.
The ordinance would amend the city’s zoning code to require that medium and hyperscale data centers use closed-loop cooling systems, meaning water pumped to the centers for cooling couldn’t be directed back to wastewater treatment facilities.
Data center operators often add chemicals such as descaling agents to municipal water used to cool the facilities. In non-closed-loop systems, the water is then pumped back into wastewater treatment facilities.
Speorl said the Department of Planning and Permits staff believe the proposed regulations will protect existing neighborhoods while ensuring residents’ health and quality of life.
“It’s important that we establish clear standards and conditions for data center developments so we can regulate the types of data centers that come to the city. We also think they will allow for innovation and economic growth,” she said. “We don’t want to ban data centers, but we want to allow them in an economy that is flourishing with data centers across the country, but we want to make sure that we do it responsibly.”
The ordinance provides definitions for different data center types based on their scale.
Hyperscale data centers, facilities of more than 200,000 square feet with an aggregate electrical demand exceeding 30 megawatts, would be permitted with conditions in heavy industrial and planned manufacturing districts. The developments would be allowed, with special exceptions, in certain mixed-use and light manufacturing districts.
Hyperscale facilities would have 19 conditions required for their development, including a minimum setback of 500 feet from any residential zoning or urban neighborhood district, a 1,000-foot setback from public transit facilities and stations and a minimum lot size of five acres.
Noise studies would be required to be conducted before and after construction, and a landscaping buffer requirement would be mandated for hyperscale developments, requiring high-density planting outside the facility or vegetation on the facility’s exterior wall.
On-site power generation would be prohibited for the facilities, except for solar power, and backup power or generator use would be limited to emergencies.
“By implementing things like closed-loop water systems, you eliminate a lot of the thirstiness for lack of a better term of these data centers,” said Garrison, adding that prohibiting local power generation helps address concerns regarding data center emissions.
Medium data centers occupy between 10,000 and 200,000 square feet and have an electrical demand between one and 30 megawatts. The facilities would be permitted with conditions in general commercial, manufacturing and certain mixed-use districts.
On-site power generation would be prohibited with the exception of solar, and the facilities would face setback requirements when placed near residential zoning. Mechanical equipment screenings would be required for the facilities.
The ordinance would also regulate micro data centers, which are under 10,000 square feet; accessory data centers, which are housed within office or commercial buildings; and fiber huts, small-scale enclosed structures housing fiber-optic or telecommunications equipment.
Speorl emphasized that the proposed ordinance, if adopted, would not be retroactively applied to existing data centers or centers currently undertaking the permitting process.
“We cannot go back and apply them to existing data centers. So, these regulations, if adopted, would be for any new data centers moving forward,” she said.
The city council’s consideration of the ordinance comes after a unanimous council vote in March that enacted a six-month moratorium halting permit applications for new or expanding data center facilities within city limits.
The moratorium followed public concern around the potential quality-of-life and environmental impacts of hyperscale data center proposals in the region, including a proposed hyperscale data center in Bessemer, which has led to a lawsuit against the city.
Plaintiffs alleged that Bessemer city officials didn’t provide proper public notice regarding rezoning that made way for the proposal and raised concerns regarding the city’s mayor signing a nondisclosure agreement with project developers.
A proposed hyperscale data center in Birmingham’s Oxmoor Valley community, backed by AI cloud company Nebius, has also received pushback from community members and environmental groups.
A protest against the proposed center took place outside Birmingham City Hall during the council meeting.
Council President Wardine T. Alexander emphasized at the opening of the meeting that the ordinance would impact future development throughout the city, not only her district, where the Nebius development is planned.
“We’re very aware that there is significant construction and development that is ongoing, and projects like these can bring substantial opportunities,” Alexander said. “I am in agreement that they raise very valid concerns about issues such as energy usage, water consumption, environmental impact, infrastructure strain and long-term community compatibility.”
Following Speorl and Garrison’s presentation on the proposed regulations, Council Member Brian Gunn expressed concerns that the 500-foot setback requirement would not put adequate distance between residential areas and the facilities.
“That’s very close in my opinion,” Gunn said, requesting that the setback distance be increased.
During the public hearing portion of the meeting, Charles Miller, policy director for the Alabama Rivers Alliance, alongside five additional speakers, also requested that the setback distance be increased to 1,000 feet.
“We would support a 1,000-foot setback. That would be what we’re looking for,” Miller said.
Miller, however, emphasized his organization’s recommendation that the council enact the ordinance.
“This timing puts our city at the cutting-edge of data center regulation in Alabama. The substantive requirements of the data center also put us at the forefront of data center regulations in the state,” he said.
“It almost goes without saying that there are some unscrupulous actors in this space. We don’t have to look far. Memphis, Tennessee, as Councilor O’Quinn mentioned, Southaven, Mississippi and Bessemer, Alabama, right here in Jefferson County,” Miller added. “Adopting a comprehensive ordinance like this that puts meaningful restrictions on data center development is a sign to those bad actors that Birmingham isn’t giving big tech a blank check.”
David Craig, an Oxmoor Valley resident, spoke in favor of the ordinance and the proposed Nebius data center.
“What I’ve heard is impressive. I’m thankful to our city for the due diligence that they have put forward to make sure that the center is an asset and not a liability to our community,” Craig said, adding that he is supportive of the data center, which he believes will help improve access to local jobs.
“We have all these young children that was here today going to school. When they graduate, we need them to reside in Birmingham, work in Birmingham, have a good-paying job in Birmingham,” he said.
Meanwhile, Rob Sansome, another Oxmoor Valley resident, spoke in opposition to the Nebius development.
“This isn’t academic for us. Our home is 800 feet from what is being constructed right now. So, we are already experiencing some of the effects of that,” he said.
Sansome recommended lowering the hyperscale classification threshold to 10 megawatts and called for a lengthier setback requirement for hyperscale facilities and noise and lighting standards for medium facilities.
“This is really critical. I know we’ve got one [facility] going up, but thank you all for at least considering putting some wireframe around the future ones, and also please don’t ignore us on the one we’ve got going,” he concluded.
Speaker Jay Reed, representing Associated Builders and Contractors, Associated General Contractors and the Birmingham Construction Industry Authority, urged the council to create a business environment that attracts data centers to the city.
“I just encourage that we send a message to data centers that Birmingham is open for business,” he said. “We have guidelines, we have policies, but we are welcoming and want to move forward with them along with the needs of the community.”
Terri Chapman, director of public policy for the Birmingham Business Alliance, encouraged the council to delay a vote to approve proposed regulations “to benchmark this ordinance against other cities, engage industry experts and make sure we strike the right balance between protecting our community and positioning our region for future growth.”
Chapman and Trevor Sutton, chief economic development officer for BBA, while saying the proposed ordinance addressed “legitimate concerns,” expressed worries that the setback and on-site power generation restrictions would make the city less competitive than peer markets in attracting data centers and other industries.
Representatives of Voters Legal Justice Watch Group and the Southern Environmental Law Center spoke in favor of the ordinance, while Josh Starnes of Plumbers and Steamfitters UA Local 91 called on the council to work to attract new data center developments.
Multiple speakers, alongside Birmingham Mayor Randall Woodfin, recommended that the council delay a vote to allow the ordinance to be further examined.
“We would recommend some additional time to actually make sure we can get this right and then be back in the position to advertise to the general public what we’re adding, what we’re subtracting, et cetera,” Woodfin said.
The city council will discuss revised ordinance language and set a date for an additional public hearing on the regulatory proposals during its regularly scheduled meeting next Tuesday.
