Politics
Umatilla declares emergency over data center permit pause as Oregon cities split
Umatilla officials say Oregon’s temporary pause on some data center permits could cost the city millions, while Hillsboro has approved limits on future development. The divide highlights competing concerns over local revenue, jobs, pollution and the state’s power to regulate the industry.
Umatilla’s City Council declared an emergency Tuesday over Oregon’s pause on certain data center permits, arguing that delays could jeopardize millions of dollars in local revenue and infrastructure investments. The move is intended to pressure Gov. Tina Kotek to reverse the pause, not to restrict data centers.
Kotek directed the state Department of Environmental Quality to stop issuing some air and water permits for data center projects through July. Her office said the pause responds to public calls for more careful decisions about the industry. The directive comes as concerns grow about data centers’ energy and water demands and the diesel pollution that backup generators could produce near communities.
Umatilla city staff estimate the pause could mean more than $2.5 million in annual tax payments, $12 million in water infrastructure improvements and contributions toward a bond for a new police station. Nearby Hermiston City Manager Mark Morgan said Amazon canceled plans for multiple projects there and estimated the city had lost about $550 million in anticipated future local fee revenue.
Those figures reflect local officials’ projections of revenue and investment that could be affected; they are not a statewide estimate. Rural communities often offer data center operators 15-year property-tax breaks through Oregon’s Enterprise Zone program, while collecting other fees that can help pay for services and construction. Umatilla resident Mary Cahill questioned whether the city had become too dependent on the industry’s money.
Officials in Eastern and Central Oregon say they were blindsided by the state’s move. Morrow County Commissioner Gus Peterson called it executive overreach, while Prineville Mayor Steve Uffelman said fees from Apple and Meta data centers have helped transform the former timber town. Amazon also criticized the pause, saying it had broad economic implications and was issued without meaningful engagement with affected communities and workers.
Hillsboro, by contrast, has moved to constrain new development. The city council unanimously approved permanent data center rules Tuesday that cap such development at slightly more than 600 acres. Existing facilities occupy about 570 acres, leaving roughly 30 acres for additional data centers under the cap. Officials are also considering standards for building height, noise and water use.
Hillsboro Councilor Rob Harris has argued that limited industrial land should go to businesses that create more jobs. The city’s economy, bolstered by semiconductor and electronics manufacturing and its proximity to Portland, differs from that of rural communities that have come to rely on data center fees.
Oregon voters are also weighing the issue: a recent poll found nearly two-thirds of likely voters supported a temporary ban on new data centers, and both major candidates for governor have backed a moratorium. State lawmakers are expected to consider data center regulations when they convene in January. Projects affected by the permitting pause include Amazon’s proposed 1,300-acre development in Boardman and a planned Sabey Data Centers facility on a 60-acre site in Umatilla.