Denver jumped onto the expanding bandwagon of animosity against massive corporate data centers Monday, with the mayor and city council jointly announcing they would try for a moratorium on new construction inside the city until a more community-friendly framework is in place.
The Denver move comes as a legislative staff report details the budget hit from lucrative tax credits for constructing new data centers, and as a north Denver community meets Tuesday to share their frustration with data centers under construction there with city officials and executives from the builder, CoreSite.
Neighbors of the Globeville-Elyia-Swansea data center by CoreSite, which the Denver-based company has also said will be expanded greatly as demand increases, say the power- and water-hungry computing sites are an environmental burden as well as a key tool in the growing surveillance state targeting immigrants.
“This cumulative burden is not accidental,” says a petition circulating online calling for a community pact for more responsible development, written by the nonprofit GES Coalition. “It is the outcome of colonial dispossession and extraction, then decades of zoning, redlining, highway construction and industrial siting that concentrated pollution next to working-class homes alongside the legacy of the Vasquez Boulevard/I-70 Superfund site, a 4.5-square-mile smelting contamination footprint affecting multiple neighborhoods,” the petition reads.
Companies like CoreSite can’t claim to be a “good neighbor” while offering nothing more than “PR, voluntary promises, or private conversations,” the coalition says.
The Coalition also serves as a land trust aimed at developing more affordable housing for the lower-income neighborhoods.
Other pollution hazards in the area include the I-70/I-270/I-25 interstate triangle, the Suncor petroleum refinery, the Purina pet food plant, and an Xcel natural gas power station. CoreSites is developing a massive data center at 49th and Race Streets.
“Data centers power the technology we depend upon and strengthen our economy,” said Denver Mayor Mike Johnston, in a joint statement with City Council members. “But as this industry evolves, so must our policies. This pause allows us to put clear and consistent guardrails in place while protecting our most precious resources and preserving our quality of life.”
The moratorium will be part of an upcoming city council ordinance vote, the officials said. “If approved, the city will conduct a review of additional, data-center specific regulations around responsible land, energy, and water use as well as zoning and affordability for ratepayers. The city will launch a process that collaborates with members of the community, climate experts, and industry leaders to clarify guidance and create a policy that is practical, predictable, and transparent,” the announcement said.
The Sun reached out to CoreSite seeking comment on the moratorium proposal.
The neighbors are advertising on Instagram a community forum on data centers and regulation Tuesday from 5:30 to 7 p.m., at Geotech Environmental, 2650 E. 40th Ave.
The sharpening of the debate in Denver comes as the state legislature considers two very different bills impacting data center development. The first one introduced, House Bill 1030, offers a 20- to 30-year sales and use tax exemption for data center builders, with sponsors arguing Colorado is missing out on the AI and data boom that has brought good-paying jobs to other states.
Nonpartisan legislative staff now estimate House Bill 1030’s breaks would cut state general fund revenue by at least a year through the tax exemptions. The Sun reported Monday the decrease would trigger a reduction in tax credits available to Coloradans with low incomes to the tune of $106 million in the fiscal year starting in July, according to the estimate.
Data center construction is underway across Colorado without the tax breaks, with 60 centers now and more in development.
Arguments that the wealthy corporations most in need of data centers don’t need tax breaks have led in part to a rival bill from other state Democrats. Senate Bill 102 does not provide tax breaks for data center construction, and requires new data centers to secure clean, renewable sources for their high electricity demands. The bill also says the extra load from data centers should not raise electricity rates for average consumers, and that utilities are not allowed to offer lower “economic development” rates to lure data center construction. In promoting Denver’s moratorium, City Council member Darrell Watson said, “Data centers use significant energy and water. We have a responsibility to manage their growth in our communities wisely and sustainably. We can protect the health of Denver communities, strengthen our climate commitments, and continue to keep our city moving forward responsibly.”