SCRANTON — Pennsylvania’s General Assembly should consider legislation explicitly authorizing counties to impose an impact fee on artificial intelligence data centers, Lackawanna County Commissioner Bill Gaughan said.
While generally opposed to local data center development, Gaughan contends the ability to impose such a fee at the county level would help Lackawanna and other host counties offset some of the negative impacts of data centers should any of the pending proposals to build them here and elsewhere in the region come to fruition.
He made that case after voicing serious misgivings at Wednesday’s commissioners meeting about data centers, the “enormous volumes” of water and electricity they require and their potential impacts on utility bills, the environment and local quality of life.
Residents of local communities targeted for data center development have raised those concerns at municipal planning and zoning meetings and similar sessions as borough and township officials weigh land-use decisions that could enable or stymie proposed data center projects. One of those decisions happened this week, when Ransom Twp. supervisors narrowly rejected an amendment to the township zoning ordinance applicant Scranton Materials LLC sought for a data center project there.
The Jessup Zoning Hearing Board also recently rejected a proposal by Breaker Street Associates LLC to build data centers along Breaker Street near Hill Street in the borough because it would have placed electrical infrastructure in a residential area. The board specifically rejected the firm’s appeal for zoning relief to build the data centers and related infrastructure.
Archbald Borough Council will consider next week a conditional-use request for the Wildcat Ridge Data Center Campus proposed along Business Route 6 and Route 247. That project proposed by Cornell Realty Management LLC would see 14 data centers built across 574.2 mountainside acres and use a maximum of 3.3 million gallons of water per day.
With concerns about data centers front of mind as local opposition mounts, Gaughan said decisions about whether and where to allow them should rest with municipal officials. But he also described the apparent inability of counties to impose county-level impact fees under current state law as a “practical constraint.”
“That authority, as I understand it, would likely require explicit authorization from the General Assembly,” he said. “In other words, even if we believe that an impact fee is fair, even if we believe it’s necessary, even if we believe that it’s good public policy, we may not have the legal tools to implement it.”
“If data centers place unique burdens on infrastructure — which I believe they will — utilities, emergency services, our housing market, environmental systems, among many other (impacts), then it’s entirely reasonable for the Commonwealth to consider legislation that allows host counties to recover some of these costs,” Gaughan continued.
Fellow Democratic Commissioner Thom Welby said Gaughan was “spot-on,” noting during his own remarks that, as a county government, “we really don’t have much power” over data center development. While the Lackawanna County Regional Planning Commission reviews and makes recommendations about zoning ordinance amendments and land-development plans related to data centers and other types of development, Welby stressed the land-use decisions themselves fall outside of the county’s purview.
“The real power lies in the individuals, and certainly making your noise to all of your elected officials is critically important, but it’s also critically important that you … stand up, to make your voice clear,” Welby said Wednesday. “It is your local zoning and your local municipalities that are making these determinations and there should not be even a question, there shouldn’t be a conversation, about a data center being located in any area near residences. I mean they do not belong in neighborhoods, and I don’t think there’s anybody up here that disagrees with that.”
Republican Commissioner Chris Chermak echoed Thursday concern about the adverse impacts potential data centers could have locally, including in terms of water and power consumption, while noting the tax revenue they could generate for and jobs they could create in the county and its municipalities. He’s neither for nor against data centers, but said they shouldn’t be sited in residential areas or draw water from the local drinking water supply.
Chermak also said he’s already discussed possible impact fees and other means of generating additional revenue from data center development with state and federal lawmakers.
“As far as impact fees, it’s just one other avenue that I certainly have already looked into and would certainly be helpful as a revenue-generator,” Chermak said. “We’ve got to look at everything.”
In an email Wednesday that followed a verbal request at the commissioners meeting, Gaughan asked county Solicitor Paul James Walker to look into whether a third-class county like Lackawanna currently has any authority under state law to “impose an impact fee, mitigation fee, or similar assessment on data centers to offset infrastructure, housing, environmental, or public-service impacts.”
If no such authority presently exists, he also asked Walker to explore whether state-level “enabling legislation” would be required and what form it might take, and to analyze any “relevant case law, statutory provisions, or precedents from other counties that have attempted similar approaches.”
Gaughan noted his goal “is not to direct local municipalities or substitute the County’s judgement for theirs, but to understand clearly the legal boundaries within which we and our local partners are operating.”