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Home My WebLink AboutAgenda 04-21-2026; 5-a - One-Year Moratorium Ordinance on “Data Centers” as a Land Use 1 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: April 21, 2026 Action Agenda Item No. 5-a SUBJECT: One-Year Moratorium Ordinance on "Data Centers" as a Land Use DEPARTMENT: County Attorney's Office & Planning and Inspections ATTACHMENT(S): INFORMATION CONTACT: 1) Ordinance Imposing a Temporary John Roberts, County Attorney, 919- Moratorium 245-2318 2) Presentation Perdita Holtz, Deputy Planning Director, 919-245-2578 PURPOSE: To hold a public hearing and receive comment on a proposed ordinance to impose a one-year moratorium on large-scale data centers as a land use, inclusive of Artificial Intelligence Data Centers, Cryptocurrency Mining Facilities, Data Centers, Data Processing Facilities, and similar uses. BACKGROUND: At its March 5, 2026, Business meeting, the BOCC voted unanimously to direct staff to prepare a presentation addressing the following: 1) The potential impacts of large-scale data center development in Orange County, including electricity demand, water usage, land use compatibility, environmental considerations, and potential impacts on residents' utility costs, and water quality. 2) Policy options available to the County, including, but not limited to, a temporary moratorium on data center development, revising the Orange County Land Use Plan and UDO, and the legal process required to implement each option. 3) Recommendation(s) for Board action. The staff provided the presentation at the March 17, 2026, Business meeting. The Board voted unanimously to hold a public hearing at its April 21, 2026, Business meeting to allow for the opportunity to declare a one-year moratorium on large-scale data centers as a land use, inclusive of Artificial Intelligence Data Centers, Cryptocurrency Mining Facilities, Data Centers, Data Processing Facilities, and similar uses. The Board also voted unanimously to direct staff to develop amendments to the County's Unified Development Ordinance (UDO) to define and regulate both "large-scale" data centers, inclusive of Artificial Intelligence Data Centers, Cryptocurrency Mining Facilities, Data Centers, Data Processing Facilities, and similar uses during this moratorium. Pursuant to North Carolina General Statute (NCGS) 160D-107, "local governments may adopt temporary moratoria on any development approval required by law, [and] the duration of any moratorium shall be reasonable in light of the specific conditions that warrant imposition of the 2 moratorium and may not exceed the period of time necessary to correct, modify, or resolve such conditions." FINANCIAL IMPACT: There is no financial impact associated with this item. ALIGNMENT WITH STRATEGIC PLAN: This item supports: • GOAL 1: ENVIRONMENTAL PROTECTION AND CLIMATE ACTION OBJECTIVE 6. Protect water supply/watersheds. OBJECTIVE 7. Conserve and protect high priority open space, including Natural Heritage sites, nature preserves, watershed riparian buffers, and prime/threatened farmland. OBJECTIVE 8. Include environmental stewardship objectives in the Comprehensive Land Use Plan. • GOAL 2: HEALTHY COMMUNITY OBJECTIVE 7. Invest in services and programs that improve the health and quality of life of the community (e.g., recreation and public open spaces, arts, etc.) RECOMMENDATION(S): The Manager recommends that the Board: 1) Conduct the public hearing and receive public comment; 2) Close the public hearing; and 3) Vote to Approve the Ordinance to Apply a One-Year Moratorium on Data Centers as a Land Use in Orange County. 3 ORD-2026-010 Attachment 1 AN ORDINANCE IMPOSING A TEMPORARY MORATORIUM ON DEVELOPMENT APPROVALS FOR LARGE SCALE DATA CENTERS AND RELATED HIGH-IMPACT FACILITIES IN ORANGE COUNTY. WHEREAS,the Orange County Board of Commissioners (the "Board") is responsible for promoting the health, safety, and general welfare of the County's residents; and WHEREAS, North Carolina General Statute § 160D-107 authorizes local governments to adopt temporary moratoria on development approvals under certain conditions; and WHEREAS,the Board has observed a recent increase in inquiries and potential applications for high- impact facilities, specifically large scale data centers and similar operations,within the unincorporated areas of the County; and WHEREAS,these types of facilities present unique challenges and potential impacts not adequately addressed by the County's current Unified Development Ordinance (UDO) or zoning regulations, including but not limited to: • Extremely high electricity consumption and strain on existing utility infrastructure; • Significant noise generation from cooling systems and backup generators, affecting adjacent residential areas and general quality of life; • Substantial water usage for cooling purposes; • Potential environmental impacts, including hazardous materials and electronic waste disposal; and • Land use compatibility concerns, including in rural or agriculturally zoned districts; and WHEREAS,the County's existing regulations were not developed with these specific types of high-impact uses in mind, and the County needs time to develop appropriate, comprehensive standards to ensure that any future development of such facilities is consistent with the County's long-term land use plan and protects the public interest; and WHEREAS,the Board has considered alternative courses of action, such as relying on existing general use permits or on-the-spot zoning amendments, but determined these were inadequate because they lack the specific performance standards (e.g., noise limits, utility capacity requirements, setbacks) needed to mitigate the unique impacts of data centers effectively; and WHEREAS, a temporary moratorium on accepting and processing new applications for such facilities is a reasonable and necessary measure to allow County staff and the Planning Board sufficient time to study the issues, engage with stakeholders, and draft appropriate amendments to the UDO; NOW,THEREFORE, BE IT ORDAINED by the Orange County Board of Commissioners: Section 1. Moratorium Imposed A temporary moratorium is hereby imposed for a period of one (1)year from the effective date of this Ordinance. During this period,the County shall not accept, process, or approve any applications for the following development approvals: • Special Use Permits; • Conditional Zoning Permits; • Zoning Map Amendments (rezoning requests); • Building Permits (except for interior renovations that do not expand capacity or impact 4 exterior appearance/noise); • Any other development approval required by law; for the establishment, construction, erection, alteration, or expansion of any data center, cryptocurrency mining facility, other high-impact data processing facility or other uses including but not limited to Artificial Intelligence Data Centers, Cryptocurrency Mining Facilities, Data Centers, Data Processing Facilities, and similar uses. Section 2.Scope and Exemptions This moratorium shall apply to all unincorporated areas of Orange County. Exemptions include: • Any development that has received a valid development approval in accordance with G.S. 160D-107(c) prior to the effective date of this ordinance. • Single and two-family residential dwellings. Section 3. Plan of Action and Schedule During the effective period of this moratorium,the Orange County Board of Commissioners and County Staff shall take the following actions: • Step 1: Study the potential impacts (energy,water, noise, land use) of data centers and similar facilities. • Step 2: Draft specific land use ordinance amendments and performance standards to regulate these facilities, including appropriate zoning districts, setback requirements, noise limitations, and utility capacity conditions. • Step 3: Planning Board review of the draft amendments. • Step 4:The Board of Commissioners will hold the necessary public hearings to consider and potentially adopt the final ordinance amendments. Section 4. Duration and Termination This Ordinance shall be in full force and effect from April 21, 2026 until April 21, 2027, unless earlier terminated, extended, or modified by the Board of Commissioners in accordance with North Carolina law.The stated duration is reasonably necessary to address the identified problems. Section 5. Severability If any section or part of this ordinance is declared invalid or unconstitutional by a court of competent jurisdiction, such invalidity shall not affect the validity of the remaining sections or parts. Adopted this the 21s'day of April, 2026. w s r�— 114%��W-MMM. ORANGE COUNTY NORTH GAROLINA Item 5a : Public Hearing to consider a Moratorium on " Data Centers" as a Land Use 6 General Definition of a Data Center A large group of networked computer servers typically used by organizations for the remote storage, processing, or distribution of large amounts of data. ORANGE COUNTY NORTH CAROLINA 7 Air Quality Impact of Data Centers • Evidence shows communities living in close proximity (i .e. , one mile) to EPA-regulated data centers have higher air pollution burdens • Evidence shows low-income communities and communities of color within one mile of EPA-regulated data centers face worse air pollution than other communities near data centers • Recent evidence suggests data center operations cause "heat island" effects in surrounding areas ORANGE COUNTY NORTH CAROLINA S Electrical , Noise, and Water Impact • Data centers require large cooling systems to function , which emit a steady hum • Evidence shows data centers can require large amounts of power similar to a medium-sized city • Evidence shows large data centers can consume up to 5 million gallons per day ORANGE COUNTY NORTH CAROLINA 9 Local Land Use Compatibility of Data Centers • Not currently defined or regulated by the Orange County UDO • Staff must examine what land use categories might be compatible with Data Centers and recommend appropriate standards • For these reasons a moratorium on Data Center development in Orange County is recommended ORANGE COUNTY NORTH CAROLINA io Manager Recommendations The Manager recommends that the Board take the following actions: 1 ) Conduct the public hearing and receive public comment; 2) Close the public hearing; and 3) Vote to Approve the Ordinance to Apply a One-Year Moratorium on Data Centers as a Land Use in Orange County. ORANGE COUNTY NORTH CAROLINA