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San Jose Moves to Halt New Data Centers While Drafting Nation's Toughest Standards
Mayor Matt Mahan and councilmembers are pushing an urgency ordinance to pause data center approvals while they craft rules requiring union labor, clean energy, and community benefits. The planning commission takes up the proposal next Wednesday, with the full council voting Dec. 8.
San Jose Mayor Matt Mahan and several city councilmembers are moving to temporarily freeze approvals of new data centers while the city drafts what they describe as the strictest set of standards in the country, citing concerns over energy costs, labor practices, and community impacts.
The city currently has dozens of data center projects working their way through the review process. To prevent those proposals from advancing under existing rules, Mahan and his allies want an urgency ordinance that would pause approvals until the new standards are in place. The proposal would not affect data centers already in operation.
"We will set the highest standards in the country in every area that the community has expressed concerns about, from labor standards requiring union labor to no subsidies to community benefits requiring that any company that wants to build here pays extra to bring down people's energy rates and invests in affordable housing and actually makes the community better off," Mahan said.
The emerging framework would require companies to use union labor, meet clean energy benchmarks, and contribute financially to affordable housing and public space improvements. Mahan also wants data center operators to pay into a fund that would lower residents' electricity bills, arguing that the community should not bear the cost of the region's technology boom.
Mahan said the city needs to act quickly because neither the state nor the federal government has established standards for the fast-growing data center industry. The planning commission is scheduled to review the proposed standards next Wednesday, and the full city council will take up the issue on Dec. 8.
The push comes as data centers â the vast computing facilities that power artificial intelligence, cloud services, and streaming â have expanded rapidly across the Bay Area, raising local concerns about electricity demand, water use, and land consumption. San Jose's effort to impose labor and environmental conditions could serve as a model for other cities grappling with the sector's growth.