Fort Smith water surcharge one idea in crafting data center development rules - Talk Business & Politics
Several members of the Fort Smith Board of Directors have asked city staff to craft new rules or amend existing rules around water use, zoning and other areas to discourage data center construction in the. . .
Several members of the Fort Smith Board of Directors have asked city staff to craft new rules or amend existing rules around water use, zoning and other areas to discourage data center construction in the city and the metro. Director Kevin Settle also wants significantly higher water rates for data centers. The board discussed the issue Tuesday (Aug. 11) with city staff during a study session, with Director Christina Catsavis asking for changes that “make it as difficult as possible” for data centers to built in the Fort Smith metro. No board member pushed back against the effort to restrict data center development. The development of data centers nationwide and in Arkansas has become controversial, with pushback often resulting from local grassroots efforts. Concerns include the potential for massive water use, rising utility rates, excessive noise, and groundwater pollution. The state of New York recently implemented a one-year moratorium on data center construction. According to reporting from CNBC and other outlets, more than 500 local governments nationwide have enacted bans, moratoriums, and other restrictions on data centers. The National Conference of State Legislatures (NCSL) monitors sactions taken or being considered by states to restrict or limit data center construction. “Proponents argue that moratoriums on data centers will allow additional time to explore their effects on local communities and improve power grid resiliency,” the NCSL notedin this report. “Opponents argue that the moratoriums will hamper AI development and hurt local economies. ”Arkansas officials, with support from Gov. Sarah Sanders, have restricted local government actions on data centers. Arkansas Act 851 of 2023 prevents local governments from banning data center development. The law does not prevent local governments from adopting rules that create delays or significant restrictions with data center projects. The cities of Fayetteville and Little Rock have approved more stringent data center development rules. There are no known data centers being considered in the Fort Smith metro, but there are five large announced data center projects in the state. The facilities are either planned or in some stage of construction in Clarksville, Conway, Little Rock, Pulaski County, and West Memphis. ‘ADDITIONAL REGULATIONS’“For me, certainly, we want to make it as difficult as possible for a data center to be here,” Catsavis said during Tuesday’s study session. “I know it’s not entirely within our control because the state has a law that says you can’t discriminate against data centers. ”Maggie Rice, deputy Fort Smith city administrator, told the board they are working on options for the board to consider. “If the board wishes to pursue additional regulations, such as public utility capacity certifications, water usage reports, enhanced setback outside of what our zoning code already requires, noise limitations outside what our municipal code already requires, what I would recommend is asking for staff, for planning staff, to prepare a new amendment to the zoning code which will track through our normal process,” Rice said Tuesday. Catsavis and Director Kevin Settle expressed concern about a data center being built outside the city and tapping into the regional water supply, which is provided by the city of Fort Smith. Acting City Administrator Jeff Dingman said staff is working on a “standardized agreement” with wholesale water users that would require Fort Smith board approval for water connections that are 2-inch in diameter or larger. Lance McAvoy, director of water resources for the city, said there can be “multiple barriers” that address water-use concerns with data centers, including a flow-limiter device that restricts water flow. WATER SURCHARGESettle said he would support language that gives the board authority over certain water connections outside city limits. “So if city x puts in an industrial park and it needs an 8-inch line, and it’s on their side, but we can say yea or nay to that,” Settle said. “And the board itself will have that approval. Not administration, the board. That’s what I want. Because that way the public and the board will hear exactly if something is coming that is going to use more water. ”Settle also requested a water surcharge for data centers, and asked city staff to find a way to create a data-center water class that would have a rate four-times the existing rate structure. “To me, the water, I’ve said many times, is our commodity, and we should be able to choose what is the price for it,” he said. ‘INFORMED ENGAGEMENT’Arkansas Rep. Aaron Pilkington, R-Knoxville, advised Fort Smith officials to “engage thoughtfully” as they seek to craft or amend rules. Pilkington, executive director of theArkansas Connected Communities Association(ARCC), a group that advocates “for data center and AI infrastructure investment that creates jobs, grows tax revenue, and strengthens communities,” said he encourages Fort Smith officials to adopt rules with a “framework built on informed engagement, not assumption. ”“I understand there is a lot of anxiety around AI and data centers right now, and that concern is real,” Pilkington said. “Some of it stems from misinformation and understandable uncertainty about a rapidly evolving technology, but not all of it. Residents in communities across the country have legitimate questions about water usage, electricity rates, and noise. Fort Smith residents deserve straight answers, not dismissiveness from either side of this debate. At the same time, these projects represent some of the largest economic development opportunities parts of this state have ever seen and likely will see for a long time to come. ”Pilkington said he is willing to work with the city in the process, including arranging facility tours and visits to construction sites. “ARCC is prepared to arrange site visits for Fort Smith’s decision-makers to operating data center facilities including projects already under construction in Arkansas so directors can see firsthand how water recirculation, noise mitigation, and utility integration actually function, rather than relying on secondhand characterizations from either side of the debate,” he said. Related