Sterling Heights puts pause on data centers

STERLING HEIGHTS — City officials are taking a proactive approach to the possibility of data centers coming to Sterling Heights.

On Feb. 3, the City Council adopted a one-year moratorium on data centers, which are specialized secure facilities that house networked computers, storage systems and computing infrastructure. They are known for high electricity and water consumption and are crucial for storing, processing and distributing data for applications, cloud services and artificial intelligence.

Sterling Heights City Planner Jake Parcell said a moratorium is necessary so the city can research and craft rules that will properly regulate any data centers proposed in the future. Although Sterling Heights doesn’t have the available land to accommodate large “hyperscale” data centers like those currently being discussed in communities like Washington Township (230 acres) and Saline Township (575 acres), the city might still face applications someday.

According to background material provided by the city, “it will not be long … before smaller data centers known as ‘enterprise data centers’ and ‘colocation centers’ are built as offshoots to the larger hyperscale data centers. These smaller data centers can be built on much smaller parcels of land and offer unique characteristics that can impact surrounding properties, as with larger facilities.”

“Quite simply, we just don’t have the space,” Parcell told City Council members about the possibility of a large development. “But what we do have are industrial parcels that may be utilized for smaller scale data centers.”

Parcell said data centers are currently permitted in five of the city’s zoning districts. He said there are pros and cons to data centers, and a moratorium gives officials time to study the issue rather than banning them outright.

“We want to look at what they can bring to the city if they are allowed,” Parcell said. “They are businesses that create taxable value for the community and create large-scale investment. They can create jobs. … They also may support the other industrial manufacturing and tech users in our industrial corridor.”

Parcell said the city needs an appropriate ordinance to oversee any data center developments that may arise.

“There’s no regulatory measure in place to help guide the development of these,” he said. “We are aware that these large facilities can be a bit of a lightning rod, and we want to make sure that we’re accounting for all of the impact that they have as they’re developed.”

The City Council unanimously approved the 12-month moratorium. Councilwoman Barbara Ziarko said it makes sense for the city to better understand data centers before officials field any requests.

“I don’t want anybody to think that this is a ban on them right now,” she said. “It’s just to stop and make some plans so that in case the opportunity ever comes up, we’re prepared for it.”

Councilman Michael Radtke agreed, adding that the city needs to “have smart regulations to protect our residents.”

“We’re not saying we’re going to put one in,” he said, “but we have to have at least some regulation in place in case. So I think this is a smart decision and I’m happy to support it.”

Likewise, Councilwoman Maria Schmidt said a moratorium is a wise action. “What we’re doing here is taking the time to get it right, because it’s hard to put Pandora back in the box,” she said. “I’m glad that we’re taking a breath and doing this the right way.”

Councilman Henry Yanez said he supports the moratorium, even though he’s unsure if any proposals will ever come forth.

“I’m not overly concerned with data centers right now,” he said. “I don’t think we’re a good candidate for them, but I don’t see any reason why we shouldn’t take the time to study it and make sure we have an ordinance that reflects the concerns that have been raised by people in other communities.”

With the right precautions and plans, data centers “represent a strong economic development opportunity for … Sterling Heights because they deliver high-value taxable investment with minimal demands on local services,” according to information submitted by the city’s Planning Department. “In Sterling Heights, data centers also align well with the city’s established industrial corridor, robust power and fiber infrastructure, and proximity to major automotive, defense, and advanced manufacturing users, many of whom already rely on secure, on-site or nearby data facilities. As a result, data centers can strengthen the city’s long-term tax base, support existing employers, and repurpose legacy industrial sites without competing for housing, retail, or community services.”

Mayor Pro Tem Liz Sierawski said “it’s extremely important to be on top of things” when it comes to data centers and their future in Sterling Heights.

“We need the time to make sure that we’re doing everything right and have the information so that, if and when we do get anything proposed to us, we are able to make good decisions for the residents.”