Good afternoon everyone. Welcome to the regular business housing and zoning committee for August 18, 2026. My name is Jamal Osman and I'm the chair of this committee. I will call the order for this meeting. Before we begin, I'd like to remind folks this meeting are broadcast live to enable greater public participation. They include realtime captioning to increase the accessibility of our proceeding to the community. Therefore, all speakers need to be mindful of the rate of their speech so that our captioners can fully transcribe all comments for the broadcast. We ask all speakers to moderate the speed and clarity of their comments. We will be using speaker management for this meeting. So, please make sure you are signed in. At this time, I'll ask clerk to call the role so we can verify a quorum. >> Council member Rainville is absent. Warren >> present. >> Schaefer >> present. Chavez >> present. >> Chiptai >> present. >> Vice chair Chowry >> present. >> And chair Osman >> present. >> There are six members present. >> Let reflect. We have a quorum. If you want to speak during the any of the public hearing for today, please sign up with the clerk. All right. Um, with with no objection, I will now move to adapt Hold on a second. So, Council Member Schaefer, would you like to amend the agenda? >> Thank you, Chair Osman. I would like to amend the agenda to add limbs file 2026-00864 to set a public hearing for amending title 13. It's before you at your desk. Chapter 266 of the Minneapolis Code of Ordinances relating to licenses and b business regulations around rental halls. >> Great. Thank you. With that, all those in favor say I. >> I. And those opposed say nay. The eyes have it and the motion carries. Right now, we're going to start with the consent agenda. Item three approves one liquor license approval. Item four approves four liquor license renewal. Item five approves seven gambling license renewals. Item six is referring to a staff ordinance related to the Minneapolis public housing authority and accountability. Lastly, our uh walk in item for council member Schaefer is set in a public hearing for the September 8th to consider an event center license ordinance. With that, does any of my colleagues have any questions? Seeing none, I will move all items for approval, prefer item six to staff, and set our walk on item for public hearing. On that motion, all those in favor say I. I. >> I. And those opposed say nay. The eyes have it and the motion carries. All right. Uh public hearing for everyone in attendance and those might be participating in our hearing or comment period. Let me offer this notice. The hearing are broadcasted recorded and broadcasted both recorded and broadcasted as are classified as a public data under the Minnesota government data practice act. By attending or participating in this proceeding, your image and any testimony or information that you might provide will also be subject to disclosure under the law. That includes but is not limited to your attendance, your name and other personal details you provide as well as testifi testimony testimony or any comments you provide which includes any written submission you might you make which are included on the record on this meeting. Our first public hearing is to receive a comment related to the 2025 consolidated annual performance evaluation report. Caper here briefly to kick us off on this item is Matt Bower. Welcome. >> Good afternoon, Chair Osman. Um members of the committee. Um before you is a public hearing on the 2025 HUD uh consolidated annual performance and evaluation report that we provide to HUD at the end of the month. A requirement before we submit the report to HUD is to hold a public comment period on the report and um hold a public hearing before that um report goes in. Any comments received during the comment period or during the hearing will be included in the report that goes to HUD. This report covers our performance over the past program year for community development block grant, home investment partnership grants, emergency solutions grants, and housing opportunities for persons with AIDS grants. It also includes uh update report on uh the remaining entitlement um grants we received from HUD, the housing and urban development department uh in addressing CO 19. um uh issues that um arose over the past now six years. Um one of those that CDBG um COVID grant is uh its performance period um ended uh the um June 30th of this year. So we've got um a couple final billings to provide HUD on that and then that grant will be able to be closed out. and that did a lot of work in the community um over the past uh six years as well as um we um completed two or are in the process of completing two um housing projects uh for special needs populations under the home investment partnerships American Rescue Plan Act which um came to the city in 2022 and we've done been able to do two projects under that. Um, with that, um, the public comment period runs through the 25th of this month, and then we plan to submit the report to HUD on the 29th, which is a Saturday. We may get it on Friday. So, with that, um, stand for any questions. Otherwise, hold the hearing. Thank you so much. Thank you for, uh, for that. I will proceed to open the public hearing and see if there's anyone who would like to speak on this item. See none, I'll close the public hearing. and see if any of my colleagues have any comments. All right, I will move this item for approval. >> I have a comment. >> I'm sorry, Council Member Pearl. >> Thank you, [clears throat] >> Warren. Please go ahead. Um, I just have a question in this HUD annual report and is it going to talk about the scoring of um, homes here in Minneapolis area and and the performance review of of all of the properties or is it just you're just looking at an overall? Is this broad, very broad, or how narrow is this? And is it um designed to speak to specific properties? I'm asking in respect to Heritage Park. >> Yeah. Uh Chair Osman and and and Council Member Warren, um it's very high level broad. We do um we do report on projects where we have home investment, home grant dollars invested. We provide a report. Part of the report is talking about the um properties that had been inspected over the past year under um the home compliance period and results of that. To my understanding um Heritage Park did not receive any home funds from the city in the past and so it wouldn't come up in the within that context. Um but no, we don't into specific um that situation. We wouldn't necessarily [clears throat] have numbers to report. Okay, >> on that >> thank you for that clarification. I appreciate it. >> I see no further discussion. I will direct clerk to file for this. Uh all right, our uh second last public hearing is ordinance related to the dress code posting requirement authored by council member Chavez Payne and Warren Wley. I will have the ordinance authors to kick off us off the presentation. Welcome, council member Jarvis. >> Thank you, Chair Osman. We'll wait for the presentation to get up. >> Thank you all. Council member Warren, Council President Payne, Council Member Wansy, and I are bringing forward the dress code posting requirement ordinance. This ordinance would require an establishment that has a dress code and sells liqu to post their dress code in a conspous place at or near the entrance to the premises so that it may be easily be viewed by the public during hours of operation. This ordinance is necessary to prevent velvet rope discrimination, which is the use of legally protected categories by public accommodation in the in their determinations of who is granted entry and in their provisions of service. In other words, this is when an establishment claims to have a reason such as a dress code as a proxy for race, gender, identity, etc. to explain why a person may not be allowed to enter. By posting a dress code, it could help address some of the concerns by the community. >> This ordinance is necessary because of the issues that have arisen around um discrimination and dangerous stereotypes about racial minorities, women, and the 2s LGBTQIA+ community and their limits. um it limits their equal enjoyment to certain establishments. So um one of the things to really um really uplift here is if you have a dress code and it is strictly enforced, post it so that everyone knows and that there is um no discrimination um to your establishment. And if you don't have a dress code, you don't have to worry about posting about it because then that just means that everyone is welcome regardless to what attire that that they're wearing. Um, the dress code requirements for businesses that do not focus on health and safety needs um tend to be arbitrary in both language and enforcement. again, no shoes, no shirts, no service, those things. That's a law across, you know, the entire state. So, that sign does not need to be posted there. Um the health and safety um policy that is governed by the state statute is not affected by this. um modeled on similar ordinances that was passed in this is modeled on similar ordinance that was passed in Houston, Texas in 2025 and the civil right ordinances that will continue to safeguard um protected classes against discrimination. Dress code is defined as a set standard of rules specifying the required manner of dress in which an attendee must comply for entry. So, if an establishment is saying no ball caps and jerseys are allowed in this establishment, then have that posted outside that says that. Otherwise, you cannot discriminate against people for coming in with ball caps and jerseys. If there is a special event that you are hosting at your establishment where it's saying, "Hey, we're doing a zombie crawl or we're doing this, that, and the other." and the dress code is relaxed, then make sure that you let the public know that the dress code is relaxed and you are welcoming all on an other than authorized or requirement um in associated association with your establishment. So those are things important to um uplift in this and that is all I have >> and then some important information for the public. Should this ordinance pass, complaints of a business violating the ordinance will be directed to 301 uh and allocated to business licenses for investigations. Complaints could also be directed to business licenses. Business license will use progressive enforcement models stressing education first. The first documented violation will result in a written vi violation notice. A second documented violation will result in an administrative citation which would carry a $200 fine. The following documented violation could result in administrative citations with the fine doubling each time and continued violations could result in a license settlement conference with conditions placed on the license and continued violations of the ordinance could ultimately result in revocation of a license. Business licenses emailed all lences with information prior to the public hearing on the ordinance as well as they will email our licenses of the requirements should this ordinance pass. The date of effect will be January 1st, 2027. Almost. >> All right. U Thank you so much for that presentation. Uh I will proceed to open the public hearing and um I have list here Howard Dudson. Welcome. Please state your name and >> Howard Dodson. War II chair, council members. I was born at HCMC. Back then it was Minneapolis General. I was in diapers at 26 in Irving. NFL North Side for Life. I moved to Maple Grove and the pioneer African-American families of Maple Grove. The Cushenberries of Patrick's Johnson's. I've been at the barbecue since I was seven. The north side is my family. And for two years, I've been hearing about a bar over Northeast turning away African-American males. 55 now. You hurt my family. You hurt me. So, here's what I've heard. 10 years ago, an African-American man went up to the bar and he was told, "We don't serve ends here. I heard about a 75year-old African-American male turned away for no whiteies. He's geriatric and you're profiling him like he's a gang member. Darnell Hooker can't be here today because he has to work. He was the first plaintiff to file a complaint against the Moose Bar and Grill with the Civil Rights Commission. Two years ago, I told Council Member Rainville about my concerns and he went to the establishment and he was told, "I had a sign and I took it down because people said it was racist. The dress code is no sweats after eight." So, if you're that concerned, how come you don't have a a wand? Why don't you scan for guns? It's a ridiculous dress code. votes left in force to keep the number of BIPOC members away from their establishment. Houston has had this for over a year. We need this in Minneapolis. >> Thank you so much for your testimony. Next person is Robin Russell. >> It's been a long time since I've been up here. Um I'm Robin Russell. I live in W 9. On the surface, this ordinance seems like a benign and uncontroversial change to policy. More careful thought uh raises concerns that should be considered before adopting the ordinance. In a recent weekly update from council member Chavez, the rational for this ordinance is stated as anecdotal evidence shows that certain establishments in the in Minneapolis appear to be using supposed dress code to arbitrarily discriminate based on protected class. In the proposed ordinance presentation, it says entrance into certain establishments is often granted or denied based on stereotypes. So which is it? A vague a vague view that anecdotally supposedly appear to do the wrong thing or do we have real demonstrated and documented problem with unposted dress codes in Minneapolis. Protections for discrimination based on protected class are already in place under federal and state laws. If there is no evidence to substantiate a civil rights claim of discrimination, it it sounds like it will be assumed that the proprietor can still be held responsible under the licensing ordinance. Would their business and liquor license be at risk? Sounds like it. Is this not a double jeopardy scenario? It is known by at least some on the dis that this ordinance is grounded in one individual's protest against a certain unpublished dress code at a certain establishment banning sweatpants at times of high attendance. While we do not know the true extent of the impact of dress codes, published or not, in our community, we do know that in recent years a white man concealed a weapon in his sweatclo and killed a brown man inside a bar. Hear me now. White pap white people wear sweatpants. To put this issue to put this ordinance forward as a protected class discrimination issue is a red herring from the real issue which is in a culture of gun violence. Do the proprietors of small businesses in our community have the tools they need to keep our social gathering spaces safe while operating in an economically viable business. >> Thank you so much for your testimony. Are there anyone else who would like to speak on this item? >> Hi, welcome. Please state your name. >> Um, my name is Mel. Um, I live in war two now. Um, so I'm here to speak in favor of the dress code posting requirement. On first reading, I saw the stated reasoning, but I want to talk about what this actually means for a community. When we hear about hate crimes in our city, the response is always, "How could this happen? Why was this allowed?" But responding after a crime happens isn't prevention. That's just damage control. Real preventative measures shape how we operate as a community. We've seen how careless the response has been to the seemingly endless cycle of discrimination in nightlife venues. In 2023, I was at an Irish pub downtown celebrating with a friend. Both of us were IDed multiple times and asked to pay before our food arrived. And when we tried to leave, staff made a scene. This had nothing to do with any posted dress code and everything to do with selective enforcement that no one could see or challenge. This ordinance fixes that. Posting requirements creates transparency. Mini Minneapolis has struggled with exclusionary practices for years, raising tobacco prices to $15 a pack, implementing anti-homeless measures that push people away from downtown, all in the name of image and protecting traffic flow. Um, without knowing the rules up front, communities bear the burden of invisible barriers. By requiring posted dress codes, we give people agency. Lower income communities, black women, queer folks, and disabled people deserve to know what they're walking into. And to that point, I will not be wearing heels to a club. But I should know that rule before I arrive. um not learn it after I'm humiliated at the door. That's blatant discrimination. >> Thank you so much. See anyone else? See none, I'll close the public hearing and see if my colleagues have a motion or comment to make on this. I see council member Chavez, please. >> Uh thank you, Council uh Chair Osman. I'll just move this for approval. Thank you. Um, Council Member Warren. >> Um, I'll second the movement. Um, but I'm going to say that it's really just simple. If you got a dress code, post it. If you don't, don't worry about it, you know. But if there is a certain class and you're saying this is, you know, how I want people to present themselves in my establishment with a jacket and a tie to be worn or heels or whatever the case is and no tennis shoes, then say that and then people will be prepared to come and patronize your business to complement the ambiance that you set forth in your establishment. If that is not the requirement and it's a dive bar and we can come as we are in our fun t-shirts and you know our jeans and sweatpants and whatever else the case is. Cool. We could do that too. I'm an artist. Majority of the places that I go don't have a dress code, right? And so I go the places where I know I can be comfortable and welcome as I am. But I know that if there are black tie spaces and where they want you to put on a jacket and what have you, it says that, you know, [clears throat] that a jacket or a blazer or dresses or whatever the case is, if they got to be a certain length or whatever it is for women and for men or anyone who identifies, you know, transversely as such, post that information so that people know what to expect and they can decide whether or not they want to patronize that place or not and that way we just know. The end. >> Thank you, Council Member. Council member Vice Chair Chowry. >> Thank you, Chair Osman. I just want to take a moment um to thank the authors of this ordinance. I'm excited to support this today. Also want to uh give a thank you to Mr. Dodson for his continued advocacy and working with community members, particularly black men in the community that have faced discrimination in our city. Um, and having this day where we're actually getting to pass this ordinance through committee. Um, I first off just want to say as a person of color in the city who has seen discrimination and experienced discrimination in different establishments, [clears throat] but has seen it occur right in front of my face. um as a young person in this city to BIPAC community members, especially BIPAC men, this is a real issue and I think this is a very very simple policy for us to put in place to ensure that there there isn't even an appearance of discrimination that can occur, right? I think Council Member Warren said it best. If you have a dress code, put up a sign that shares it. If you don't, then don't worry about it. And to the point about is there evidence for this? There are several sociological studies over several years that show that black men at a higher rate are discriminated against and denied entry at nightclubs compared to their white peers that wear identical attire. So, this has been longstanding a part of um what sociologists and those in the legal field have taken a look at. And I think this is a great proactive step for Minneapolis to take. So I'll be voting in favor of this. >> Thank you so much, Vice Chair Chowry. And I will add um this is just small part of the solution. Discrimination is not new. Dress code, hairstyle, um it happens all the time. and grow growing up early 2000 myself, you know, uh the culture hip-hop culture effect. I was sent back um I told I can't get in because I had a baggy pants and that's how things were different. So I think selective attitude and picking and choosing uh based on your look and your dress or your culture um should not be uh tolerated. We're not in 1950s here. We are well advanced society and people should be respected um their culture and their uniqueness. And if you want to invite folks and look a certain way um then post that. It really makes perfect sense. This is not solution that will solve all discriminations and pushing people back, but it's some [sighs] way of trying to find a solution and I thank the council authors uh who brought this forward. I'll recognize council member Chavez. >> Thank you, Chair Osman. I I think about the high-profile case that happened at a downtown bar here in Minneapolis where there was a white man that was allowed entry wearing a twin shirt and a black man not allowed entry wearing a twin shirt. And it was a big profiled case in the city of Minneapolis. It's a big reminder of um one individual was not let in who was black and one was let in who was white. and that's the arbitrary enforcement that does have the undertone of racism in in in certain locations. So, I just wanted to highlight that case. I'll talk about my own case. Before I got on the city council, I went to an uptown a bar in uptown. There was an individual in front of me that was led in wearing similar clothes as I. The only difference is that they had a pouch that was black and I had a pouch that was rainbow. Why was someone that was wearing the same thing as me with the pouch that was black let in? And the pouch was black, right? And then I had a pouch that was rainbow. LGBTQ was pride month, not let in. Those are examples that happen across our city at certain establishments that need to be addressed. And I can understand why some people may not understand that racism exists in this country, but it does. >> Thank you so much. Uh, seeing no one else on that motion to approve this item. All those in favor say I. >> Roll call. >> Oh, roll call. U, council member Shav has requested roll call. Clerk, please. >> Council member Rainville. >> I, >> Warren. >> I, >> Schaefer. >> I, Chavez, >> I. >> Chip Tai, >> I. >> Vice Chair Chowry, >> I. >> And Chair Osman, >> I. There are seven eyes. >> And that motion carries. I would like to recognize that we have been joined by council member Rainville who gave me an advanced notice that he will be running late. All right. Um our next item is a discussion item and item is discussion. We will be considering new liquor license for rain located at 2901 Henipin Avenue. a staff is here with a brief update to present and answer any questions my colleagues might have. I um would like to invite Julie to uh tell us what has been going on. I know there has been conversation between the business licensing the MPD and also the rain business. Welcome. >> Thank you. Good afternoon uh Chair Osman, members of the committee. Julianne Linham, uh, director of economic policy and development. So, you all are aware that there was a pretty serious incident outside of Rain Nightclub, uh, in June where there were nine people shot. Since that time, we had a license basically the equivalent of a license settlement conference. We had a meeting with the business owner um, the week following and found their security plan to be in order. although needing some updates. So since that time, which was right after the the event occurred, they have updated their security plan. They've updated their business plan. The I believe the precinct inspector did a walkth through of the business with the business owner and has signed off on security plan as well. We did not find in our investigation. We didn't find any nexus rel from the business to the activity outside. We have some details of what occurred from the police department which was an individual dispute between two people. One saw the other and fired a gun at a crowd. Um the 311s I can give you also to if you would like some information about three the 911 calls but the mo we looked into the 911 and 311 calls. The majority of calls were related more to livability concerns. So um unhoused folks, daytime drug use, graffiti, those types of things were what were coming through through 311. Similarly with 911 um since 2024 the main they call them problem nature codes the top five are narcotics or drug activity suspicious person fight disturbance or assist emergency medical service there we think there is a little bit of an uptick this year because the um business owner was encouraged to call 911 by the precinct inspector and business licensing. We do that as well. We have we are in complaint driven systems. So, we never want our business owners to be afraid to call 911 for help and worry that it will be held against them later. Uh, let me see. I don't think there's anything else. No. >> Okay. >> So, I'll take any questions if you have any questions. >> Yeah. Um, well, thank you so much and thank you for the business. uh licensing and and um civil leadership to really consider the resident's concern and meet with the business owners and come up with this security plan, business plan and making sure that the MPD is aware of what's happening and sounds like uh the owner is working with the city and has a plan. Um so that is that is a good uh note and that's why it's really smart to hold and take a minute and you know consider um what we what we are approving and this is this is the result of it. So one question are there any other condition uh I know this is this security plan business plan is that a part of a condition or it's just them saying that um I'm trying to figure out if there's a >> sure >> people ask what conditions are we voting >> for rain to get the renewal >> chair Osman we this is not we don't consider the security plan a condition necessarily they are required to do security plans when you own a bar in this particular case, we did request MPD sign off. So, business licensing has some discretion about whether we will abide by the police department's sign off or not. In this case, we've basically demanded that the police department sign off. The security plan, we don't add conditions if we can't find a violation. >> Sure. >> Uh, one thing I did forget to mention though is that this bar typically has offduty working. So they have part-time officers working regularly. It just happens on that particular evening they did not because they were pulled to the chief speed. So the response was very quick but there wasn't an officer actually on site doing security for rain but that wasn't because of anything they did. >> Sure. And um I will be supporting this uh renewal. Um I encourage the business owners and to really continue to engage with precinct which is a phenomenal precinct over there. Um officers are doing a a good job and also people do have a actual concern of crime in in in our city and and I see that he has a plan of working with with the city which is a good sign and I appreciate the staff for your time and commitment. Um, I will recognize council member Schaefer. >> Yeah. I just wanted to also say thank you for your thoroughess and being willing to take the time to investigate this. Can you just speak to what happens now? If if there's any other future touch bases that you have with rain um ongoing or what the forward look >> absolutely >> is >> through the chair, council member Schaefer. Uh, one thing we noted immediately after this happened is that we hadn't heard from them in six years. And so that that is an indicator for us. We hear about the businesses that have ongoing issues. We do have regular touches with them if there need to be tweaks to their security plan. Uh licensing staff reaches out regularly to business owners just to check in with them about how things are going or sometimes it's a late fee. Uh but in this case, no. So we would only add additional things if there were additional problems that that we see here in the future. Thank you. >> Right. I'll see no one else. I will see if council member Chuktai from W 10 like to make the motion. >> Thank you, Mr. Chair. I'll move approval of this item. >> All right. Second item has been approved and seconded. All those in favor say I. >> And those opposed say nay. The eyes have it and the motion carries. Thank you. All right. Our last item is a receive and file item and we will be receiving presentation related to the data centers. I will be uh right Miller from legislative uh research oversight to kick us off. Welcome sir. >> Oh no, no problem. I just want to make sure everything was all settled. All right. Um, >> good um, afternoon chair Osman and biz committee members. My name is Dwight Miller and I'm excited to give this very high level overview of data center reports. Um, as usual, I want to make sure I emphasize that this presentation discusses many components that are in the LRO report which I delivered to your box and is also um, available online. Um, and also to make sure that you know that we're having a legislative lab next week for any follow-up questions. There'll be plenty of opportunities to engage with this material. Um, I also just I've seen a lot of these presentations and they're usually around one to three hours. I'm going to try to do it in close to 30 to 35 minutes. Um, and so I just wanted to give you a sense of like where we're going where we're going the road map here. Um but yeah going to talk a little bit about data center and some of the research that I saw what was happening across country and also kind of put it in the Minneapolis context. Um first just want to give some background on the staff direction. Um this report these are sort of the five very large buckets um for the report as far as like the direction that you all gave um the city council gave back in May um regarding data centers. Um really thinking about the report is data center 101 giving some definitions and some distinction of data centers. Uh landscape analysis of data centers development and regulation analysis of potential fiscal and economic development implications kind of understanding sort of the so what um analysis of the impacts of data cent's own communities the environment and how we should consider infrastructure impacts um within the Minneapolis context and a review of regulatory opportunities and constraints that we have. Um I think highlighted in all of his research is that this is a very rapidly changing area that week to week there'll be an innovation or new finding or new study um that comes up and so there is a lot of things that can change. I sense that some of the stuff within this piece material will be out of date in the next couple of months just because that's how rapidly the landscape is changing. Um I also want to just call call you know it is what it is as far as the a lot of noise um around this topic. There's a lot of noise on the internet particularly on social media about both the dangers and the virtues of data centers. And my aim today and also through the report is just to kind of deliver sort of the facts I mean also put this from it being the context in Georgia or in Texas or in Nevada just put in the context of Minneapolis and using those regulations as comparison. So just wanted to kind of level set some things there. Data center overview for first part. So what are data centers? Um data centers I call them the digital backbone of the internet. So they root and connect and store necessary data to support streaming, shopping, video conferencing, everything that encompasses our um digital lives. This meeting right here is supported by a data center of some some sort. Um however with recent advancements in general AI we've been seeing a high a more increased demand in computing capacity which cause an explosion demand for data centers. However, I do want to make sure that we are not using within the policy context um AI and data centers interchangeably while they are interconnected um data centers does not necessarily mean AI um within the policy context. However, all AI do need data centers um in order to be able to support it. Um just to make sure we have that clear distinction. Here are some data center component some components of data centers. Um generally this is from um core sites which does data center operations. This is a highle overview of what is considered in a data center and also been having been to two data centers in with um CPAD who's been very instrumental in helping me um develop this report. Um this is sort of the main components. There are servers um that run application and process data. This is where those really valuable NVIDIA GPUs are located. Um there are storage systems. There's networking compl um equipment. There are cooling system which can be both air cooled, closed loop, open loop or direct liquid cooling system which we will discuss later in the presentation. And there's also power infrastructure that either be batteries um generators and also just connections to generally substations within um with in the area. So that's sort of the high level here are the components of a data center. And along with that, with all of these data centers, they have kind of the same nuts and bolts. Um, but there are different categories and classifications. So, I put this picture up here because that is an IBM data center that's in a trailer, basically a shipping container. And then there that is the Colossus um down in Memphis, Tennessee. So, as we can see here, as far as sizing goes, they can vary widely in size from trailer to Colossus. Um along with that there are also um different types of facilities which I think was mentioned by um vice chair Shry whenever first came up with the the moratorium and I know that we've mentioned it but I want to make sure we level set. Um you have enterprise which serves only one um organization collocation facilities which release space and computing infrastructure to multiple customers. There are cloud facilities that support cloud services, hypers scale facilities that are generally supporting very large clouds and also AI operations. The one thing with these categor and also there's edge um computing systems which are generally like how do we make sure we're making connections between these large facilities and connecting them to end users. Um so think of them as like very essential nodes in the network of data centers. I do want to kind of highlight that this kind of makes regulation of them very difficult. Um, not all of these categories are exclusive. There could be enterprise data centers that are hypers scale. There could be edge centers that also serve some collocation capacity. It really depends based on data center to data center which is also goes back to some of the bigger themes within this report and within the research is that context matters and that looking into deeply into each one of these projects is very important. Resource demands. Um so they take a lot of resources data centers do. Um particularly when it comes to resource demands there's sort of megawws or electric the measure of electrical capacity. I do want to kind of highlight that this is you'll hear a lot of this is how many megawatts a data center has as far as their capacity or how many megawatts they use per hour. So I just want to kind of level set there. Um along with that there's also some of this work around water usage which is generally the cooling system. Um based on the cooling system generally when it comes to resource demand it sort of oscillates between electricity and water usage. So generally sometimes the more water that you use for instance with evaporative cooling which uses water only once through data centers in order to cool them and then discharges that that's going to use a lot of water but it's going to use a lot less electricity um requirements. Um so you're going to see the water demand goes up but the electricity go down. Likewise, if you're having a closed loop system which needs which takes the water, puts it down into the data into the servers cools them sucks it back up and then and then cools that water to be reused again. That cooling takes some level of energy and electricity. So you'll see electricity water use goes down and then electricity use goes up. So it kind of oscillates. This is of course very broad generalities. There's also direct cooling system which uses more which is uses more efficient water use and also uses more efficient um electric use. That is something that's come up a little bit more in the um kind of the technology. But I wanted to highlight that when you talk about resource demands generally we're talking about water and electricity. I'm also highlight um square footage does not is not a proxy for electrical demand or water demand. um that we cannot use square footage as oh is a 100,000 square foot um entity this is going to use this much megawwatt. I will credit that um of all of the cities I spoke with, Minneapolis is the one place that had some level of here is our best guess of how we can maybe have a conversion. Um which I think we should always like praise and admirability of CPAD and that work. Um but generally square footage is not a proc is not a direct correlation with ledger demand. Um however we get more into like why we use square footage um later and also you would get that with um sepeds work. Now within this uh within this resource demands there's also lots of environmental impacts. I mentioned water and electricity. Um electricity consumption is generally the largest consideration when we're talking about data centers particularly when it comes to greenhouse gases and the impact of of that electricity depends on really generation mix. Um, just because you're using a lot of electricity, that doesn't necessarily mean there's greenhouse gases. Um, it really depends on the grid that you're using, whether you're using wind, wind, solar, um, in order to get the electricity or hydroelectric in order to get electricity or whether you're using coal. Um, we'll talk a little more about that when we get into the landscape of the differences a little bit. Um, water consumption depends heavily on the cooling technology. Like I mentioned before, some systems use very little water, others use significantly more water. Um, and really the environmental impact, some of the environmental impacts like you might have heard is what do we do with the discharged water? Um, there have been some reports um on the like talking about social media on social media that talks a lot about water getting discharged directly back into the um water wellwater or the water resources without being treated. Um, I do want to just, you know, put a footnote there that in Minneapolis all the water that is discharged is treated. So, just kind of get ahead of there. But that is an environmental impact that data centers is that they do impact w they do impact electricity. They do impact um greenhouse gas emissions if the electricity is unclean. And the data centers can be used to discharge water into water systems if there's not regulations telling them that they cannot do that. Thankfully within Minnesota in our context we have that. Um so those are things that we might have be less concerned here but nationally that is a different conversation. You're hearing me say that a lot. It's like nationally it's a different conversation. Um there's also economic and fiscal considerations. So we have sort of the cost which is kind of the the energy the water. What are the kind of economic and fiscal considerations? So um there's a lot of money tied into capital investments for data centers as you have more and more exploding data center demand. Some of that is speculative in order anticipation for um a demand ahead. Um some of it is stuff in order to meet demand currently. Um it really just depends. Um construction which is highly touted creates um temporary employment. Um however there are there also high paying jobs that are used to maintain those data centers particularly engineers, electricians. I will say one note on this is that when it comes to construction creation um of sometimes within the construction demand, there are contractors that move from job site to job site nationwide. And so construction jobs created in a lo in a specific locality might not be jobs that are local jobs. They might be jobs that are come pulling from national technicians who move from place to place because they specialize in that role. At the same time on the flip side, localized jobs generally one Brookings Institute had a study where one data center might not impact these kind of more sustainable permanent high-paying jobs because it's only one data center. However, when you have a network of data centers or you have lots of data centers in one concentrated area, that's when you create more of a labor market of those highly um skilled jobs that are used in order to maintain data centers. Um so the employment is a little bit of a there's a fuzzy opakqueness to that. Um operations also require very few workers, been to two data centers, you would go feet, hundreds of feet without seeing a data person there and then you see an engineer. Um so there are very few workers. Property valu some fiscal considerations from the city. Um we do collect franchise fees for large utility users. Um we also there are property valuations which I know has been touted because of just the increase particularly sleep number building which sold for eight times its value. um speaking with the assessor's office, it takes a lot of buildings being sold in order to determine what the assessed value is of that set building because you need comps in order to be able to make that. Um the assessment of data centers is still as a science kind of versioning. And so there's a an a lot of unknown as far as like whether this is going to increase the value. And so what you're really thinking about when you're talking about like property valuations is don't think of it as a certainty, but there is a understanding that these are high cost um items and also that a use for a building is probably better than no use for a building. But that's but as far as the other components of that, whether a data center is going to be more valuable than a pickle ball court, that's going to be something that might be take some time in order for assessor science in order to be able to get. Um so with all the economic and fiscal considerations and this was in the report there's some opakeness with it and so there's really no certainty um which is of course part for the course whenever you have a fast growing um field such as data centers um regarding one of the challenges with data centers is that there isn't one level of government that impacts data centers. A lot of the times the regulatory framework requires cities, state, utilities, regional organizations, and federal um governments in order to really reg and within that they're trying to figure out well what do we need to do in order to create data centers. Um so we're trying to so we're going to zoom in to Minneapolis and kind of zoom out um throughout when we're talking about the regulatory framework. Um so currently currently currently currently in Minneapolis which part of this is the reason why we had the moratorum in the first place. Um there's no standalone definition for data centers. Um CPAD has historic the city has historically um interpret data centers um that is a principal use of a property as a communication exchange which is currently allowed in 10 of the 15 of the city's 15 zoning um districts. I do say with communication exchange the way that you hear people talk about data centers as far as like being able to move through like send you to Netflix and then come back. It is you could see how that is a commun exchange of communication is just that is something that is a much older definition. So we need something that fits it a little bit better. Um and that is just I want to make sure I put that um if a business or institution has a server room that supports its own operation that isn't treated as a separate communication exchange or data center. um that is generally treated as an accessory use. Um so there's tons of buildings that have smaller data server rooms. Those are not considered at this point information exchanges or communication exchanges or data centers. Um those are just kind of their own use for the um for that um facility. Um and also under the current code, those principal use data centers generally operate under the same regulatory framework regardless of size or anticipated electric demand. It's just it is an information exchange. Um, a lot of the issues that come up with data centers conversations actually sits within the state of Minnesota. Um, the Department of Natural Resources handles water appropriation. Um, the the Minnesota Pollution Control Agency is responsible for applicable environmental permitting. The um, public utilities commission regulates significant aspects of electric utility services and they're the ones who regulate how many megawatts a building can use. Um there is some state movement that happened in 2025 related specifically to data centers particularly taking away the tax exemption the state the state sales tax exemption for electricity for data centers but there is um a state sales tax exemption um that does also apply to local state tax I'm sorry sales tax um and also one very important one kind of another point with the 2025 legislation is that if there are upgrades to are needed in order to serve the electrical needs of a data center. That is on the data center to pay that. Um they're not passing it off to the consumer. Um and so that's just one thing as far as the Minnesota regulatory framework there. Um just wanted to give a highlight level things of that. We're talking more about that state um later as I'm being mindful of time. And then federal policy. So within the federal within this current federal context, there's just been a lot of push to increase data center capacity um particularly within the um development of AI and data center infrastructure. There was an executive order issued in 2025 that directed federal agencies to streamline permitting projects um per permitting processes um for large project and expand the potential use for federal lands and brownfield sites. But it is important to understand that this doesn't usurp the um sort of local zoning authority that we have here in Minneapolis. Um at this point, as of this day, there is no evidence that the federal government is going to preempt states and localities from being able to regulate data centers. Um and I say that with really really big pause. um just because we understand the complexities of the federal government as it currently stands. All right. So um we have the we have some of the policy. I do also want to get a little bit more of this Minneapolis's infrastructure. Um I know CPAD had a really good video regarding just why Minneapolis. A lot of it is because of our access to water and our access to substations. Um, but I do want to give some just ground us in sort of what do we have currently here in Minneapolis as far as data center infrastructure. Um, so currently right now there are eight known data buildings that have data centers in them within the Minneapolis market. All of them really most of them really concentrated in the downtown core area. I do want to make a note that you might see data um the number side at 18 instead of eight. Datacentermap.com which is a which is a private website that is used in order to market data centers count data centers per like data centers per building. So it's all the data centers while when it comes to zoning we zone based on buildings. And so for our purposes knowing the buildings that have data center versus the individual data centers inside the buildings because we regulate the buildings and not the individual data centers inside. I say that because I'm going to have some numbers um later on um that con talks about some comparisons of data centers and I use the data center maps numbers as comparison versus each cities because each city looks at the cumulative number of data centers how they regulate it a little bit differently. Um when you say how many data centers do you have? Um most of the facilities are developed over several decades and are concentrated around the downtown core. Um the data center I went to one of them developed in 1987. That's a sleep number building and then there's other one developed 1982. Um so these have been around for a very long time. They're generally smaller and in collocation facilities in existing buildings rather than these very large hypers scale campuses that you see driving much of the national discussion. And that's I just want to make sure that's a important distinction because a lot of what we're talking about as far as like land use and what we can do um making sure we're put in the context of really a lot of these buildings are already built and as a result what we're going to be regulating might look different than a Louisville, a St. Louis um of Phoenix. Um also when you hear national numbers around electricity consumption, water demand or employment from hypers scale facilities, those aren't necessarily representative in Minneapolis's data center market because a lot of those national numbers include some of these hypers scale facilities and which is not necessarily what Minneapolis um has to offer um in regards to size um of data centers. Um I know electricity is a big um a big concern. Um Excel is a pime primarily serves Minneapolis and it's actually part of a larger regional electric grid MISO. Um so the question of whether a particular data center can be served isn't simply does Minnesota generate enough electricity. um utilities have to look at whether their transmissions, distributions, infrastructure can actually deliver the electricity to particular sites. This means they're looking for substations. They're looking for existing loads, transmission capacity, planned improvements. A lot of work goes into being able to determine whether a data center can be in the place and Excel sort Excel Energy serves as that. We are kind of making that determination of whether a data center actually can be supported by the infrastructure that it has. And a lot of the what really makes it really attractive Minneapolis is that if you see how downtown core is surrounded by substation which offers lots of large power support large power loads. Um I think that's a very important point because if you look at other parts of the map there where there's not substations around that's going to be less of an incentivized area for you to develop a data center because then that means you also have to if you're a developer based on Mano State statue have to pay for a substation to also be there. Um, so just wanted to highlight this because this sort of sales a little bit of the picture of where our electrical capacity is, but also sort of what are some of the cost benefits that developers are doing whenever they're looking at where to put a data center within our city. um bright side with M Minnesota um the broader Minnesota energy context is very important and there's a lot of diversity within our electrical portfolio which includes lots of um some nuclear natural gas solar hydro power but also um wind and this is just a map um from Excel that talks about both the green energy projects that they have but also green energy projects that are coming up um renewable energy according to um federal data is around 33%. I know there's some estimates that kind of gets into the 40%, but I use a more conservative estimate of 33% of renewable energy across the grid. Um Minnesota ranks eighth nationally in high and wind capacity. Um and also among the among usually policy lists, we're kind of in the top rank of policy list of we have good energy policy. Um which it would help support a data center infrastructure. Along with that, there is also just the requirement statutoily of 100% carbon-f free electricity by 2040. Um, which would also include data centers to be carbon free. Um, that is something that is not not every state has. Um, and once again, this is this is part of the reasons why um data centers might be more more attracted to Minnesota is because of our um electrical grid system um which kind of gets built out and also has sustainability qualities. Another part of the infrastructure that we have is district energy. I know Minneapolis and St. Paul both have a pretty extensive district energy area. Our district energy downtown served by Cordia. Um, so data centers generate a lot of heat. Um, and so the idea of district energies, district energy just outside of data centers that you're taking, you're having heat and you're pumping it through networks and pipes underneath the underneath the city to particular buildings. Um the idea of data centers part as part of that is data centers create lots of heat. What if we were to use a lot of that heat and pump it into the district energy system in order to supply it to other customers. Um Helsinki and Finland does a really has a really good extensive um district um energy um network and they've actually worked a lot with data centers to in order to build it out and build more capacity. Um we are not currently aware in Minneapolis why we have data centers and we have a district energy system. We don't have any evidence that they're meeting and connecting with one another. Um however it is technically possible. It does it is intensive to do that because it means having to dig up road lay pipe in order to connect to the data center and then they have when they have added capacity they have to balance that with a customer. event and you have to build take up the road and build pipes in order to get to that customer. So it does there is it is not as simple as we just switch on and off but it is a possibility especially since Minneapolis has a large concentration of downtown data centers that are also concentrated in where we have a district energy source. Um, and so that is just an I an idea that we wanted to throw out there because I know it was something that was of um cons of interest whenever the first staff direction version of staff direction was developed and now we're just getting into Minneapolis water system um which Mississippi River supplies Minneapolis um and we have a water system that I think has pretty wide regional and national acclaim. People who visit me say, "Oh, I heard that the water here is great." Um, I know we take much pride in having water treatment facility that um can support our our city. Um, currently it delivers around the our water system delivers around 55 million gallons per day of annual on an annual average basis. Around peak conditions, it get to maybe 80 to 85 million gallons per day. The water treatment system itself when I asked Minneapolis water and public works can produce around 110 million gallons per day which leaves around 25 to 30 million gallons per day available for treatment capacity. Now what does that mean in the context of data centers? So looking at the sleep number building, we were able to look at particularly because we control that data as being part of the city of Minneapolis. Um kind of look before and after um this kind of whenever this data center was developed before it was developed. So before it was developed, the Sleep Number headquarters had about 334,000 gallons per month. Um after the data center was developed in 2025, it was around 3 million gallons per month. Now I do want to put that in the context of that there's 20 to 25 there's 25 to 30 million gallons per day in capacity. Um so when talking to public works about this and even just doing the math um public works is not anticipating significant systemwide strain as a result of data centers entering in more data centers entering into Minneapolis market. And even if you did the math, it would have to be a substantial amount of data centers um to get to a point where we are running out of treatable water um in the city of Minneapolis context. I do want to put that big um part there. And also like I said before, any water that is waste is treated in our facilities and then then distributed back to Mississippi after it's been treated like all the other water that we do. um it is not discharging directly from the data center into the Mississippi. Um I think the REGG services team would have something to say about that if that was the case. Before I get into the community planning economic development, I know it's been a lot and I'm I'm a strategic by trade. So I just want to make sure that there's any questions now we can answer them now quickly. >> Uh I think you should finish presentation. When does the question start this? >> I just want I just want I just want to make sure I want to make sure we we are creating an area where we can have a dialogue here. Um so the community planning economic development proposal while LRO was conducting this broad research on policy research CPAD was separately evaluating how data centers should be treated in Minneapolis and the zoning code. And so a lot of this research was happening at the same time as we were working um with CPED in order to hopefully as I'm learning stuff being able to help support them and as they're learning stuff they're supporting our research so that way we are sort of working together towards the same goal because ultimately we all want to make sure that we have the most livable Minneapolis in the best regulations. Um so you might have already heard this this is a very high level version of that. Um, CPAD CPAD's proposal would create a standalone definition for data centers rather than continue to regulate them as communication exchanges. It would also generally limit them to D21 and D22 downtown um, zoning districts which require conditional use permits which would be approved by the planning commission. I will say that whenever I developed this report, I found out from CPAD on the Thursday about the overlay district, which was around the time I was clicking print on the highlighted there in yellow. Proposal established a 175,000 square foot limitation of data centers for whites space, which is just a server technology that's there for the building. Um, and not including the generators or the cooling technology that's there. Um and beyond the location size, it also has a number of sort of standards, building design, noise, um sound actuation, gen figuring out generators. I know there's work being done with department of health on like how do we best regulate generators? Um and also associate electrical infrastructure being able to say, hey, you need some type of sign from Excel saying that they can provide the electricity um for you. Um, applicants will also need to disclose what the anticipated electricity is and water consumption is and also evidence that there's serving electrical utilities has been informed by this proposed development. Making sure I've said that twice. Um, and also compared to the current framework, there's just a lot more here around data centers and is a lot more specific and informed. Um but particularly it really at least outside of the overlay district it limits data centers to where they already have are and also sort of matches with where they would have the most demand anyway because of the substation location and just the general infrastructure of downtown which is really designed for commercial intensive commercial use. Um so within this landscape analysis I looked at six cities. Now I will say one of the broad trends you will notice is that these six cities are in sunb belt locations. Um speaking a lot of this landscape analysis was based on what evidence that we have of any type of ordinance being proposed ordinance or data centers being established. Um, and a lot of the cities that we might you might see LRO usually sort of comparing ourselves to the Seattle, the San Francisco, the Portland's, those Chicago, those cities didn't have at least knee-jerk reaction like popped out. Oh, they're creating ordinances. Some of those cities even are under moratorium. So, they're sort of in the process of what we're at now. I spoke to Denver directly because I know that they're Excel Energy partner. Um, and they looked at me and they said, "We're just waiting for Minneapolis to see what y'all have because y'all are a little bit ahead of us." Um, and so they're really interested in what I have as far as the research and what we're doing. Um, so they're looking at us. So once again, kind of showing Minneapolis as a kind of a thought leader in the region within sort of our peer cities um of working with ordinances. So you would notice that there profile six cities and they're generally in some belt cities. Also there's in the context of states that are trying to encourage data centers. So there's a little bit more incentives for places like Birmingham, Alabama, Atlanta, Louisville to create more local ordinances because they have state um pressures that are increasing and ramping it up at a rapid at a rapid pace. Um, also I want to say that a lot of these cities there are some use megawws, some use square footage, some use both, some focus more on like where the um data centers are because they are more sprawly than Minneapolis. It really all depends. Um, but across all of them, we saw cities using uh existing land use authority to address the impacts and what they can directly regulate. A lot of them there a lot of them actually all of them said megawws is the best way for us to regulate this but in every single one of them said we are limited in how we're able to regulate some of them they put in megawws because they said well hopefully we don't get preemptive from it by the state legislature with a kind of an expectation that they will um so I do want to make sure we're as far as the boat as far as our inability or our limitations on being able to regulate electrocola That is not an Minneapolis only problem. That is something that a lot of cities are dealing with. Also within each of these I have a map of where the data centers are and also the number of data centers. So Birmingham, Alabama. Um so Birmingham is one example of a city using kind of a tiered approach. So instead of kind of seeing data centers as all data centers, they tier them based on the size. So small or micro data centers are going to be regulated differently from than large data centers. Their policy discussion this in policy discussions really this data center ordinance was influenced by a 1,200 megawatt uh data center proposal in Bessemer Alabama which is right outside of um Birmingham Alabama. Um Birmingham ultimately developed different classifications based on the size and facility and concentrated large data centers primarily in industrial areas. Um and you'll see that trend is that this concentration of putting them in industrial areas, especially Birmingham being a traditionally industrial city. Um their approach is essentially that as the scale and potential impact of the facility increases, regulatory requirements increases. Um and the concept of scaled oversight. So the bigger it is, the more we're going to regulate, the more we're going to require you to do um noise studies, electric like give us a letter that says that you can meet the electrical demands. But they're looking at it from a sense of how do we regulate large data centers, hypers scale data centers from these smaller ones. Um because they also have a lot more space than Minneapolis has. Louisville, Kentucky, which has n currently 19 data centers, um they there was their proposal was triggered by a hypers scale data center that was around roughly 1.6 6 million square feet and they're like we need to do some type of regulations around that. Um particularly notable within Louisville which I wanted to highlight is the amount of public engagement that they have for their ordinances. They're still developing them and they had four um that four public meetings that are actually geographically around the area and that was something that they had never done before. They always had public hearings in the central area, but they wanted to go out to neighborhoods and actually get the public engagement. This was after they had around three, let me make sure I get this right. Um, I think 3 to six thou 3,000, yes, 3,000 public comments. Um, and also they were saying we had this is we haven't had as many comments on an ordinance in a very long time or ever. Um, and so you want to make sure they have lots of public engagement. They regulate things like noise generate generator testing setbacks landscapes um and infrastructure. Uh they require information on utilities regarding the ability to serve proposed facilities. But the one thing I want to highlight with Louisville is just their level of public engagement during the development process of the um ordinance that they have. Next we have Nashville, Tennessee. I will say Nashville's uh data center ordinance um is was the most um comprehensive data center um proposal. It often was used when I was talking to other cities. I said, "Have you spoken to Nashville? You need to speak to Nashville um as an example um of a really well-written data a well-written data center ordinance with of course the expectation that their Tennessee um legislature will preempt them in a lot of things. um because that's the context in which they um live in. But they um have categories um both square footage and electrical demand are being used um to be able to regulate. They kind of differentiate between accessory, small, medium, large and in campus level data centers. Um there is actually just a sort of a prohibit a prohibition on data centers that are 500,000 square feet greater than that um or 100 megawws um greater than that. Um Nashville is particularly interesting because the framework explicitly recognizes the point that we discussed that building size and electric demand doesn't um aren't correlated um in order to the only way to really directly address megawws is really just to be able to address megawws. Um that being said, like I said before, they're not very they are there's a lot of um concernation about whether this would actually be able to be a sustained ordinance. Um but they are wanting to make the sort of the best policy on paper um as possible. Phoenix took a very different approach. Um they sort of divided data centers into different categories based on square footage and megawws. Um sorry, they don't do that. And instead what they do is they regulate data centers as distinct use and then focus on the development and intensity and location and performance around that area. So really figuring out how do we put this away from sensitive areas, daycarees, um neighborhood residential and other other places and kind of keep them separated along with being able to figure out ways to create landscaping to reduce noise and those other impacts. Um, I will say Phoenix, Arizona is different from the other three previous ones because there's a lot of data center activity that's there. There's actually some ASU reporting that um, suggest that data centers are increasing the temperature of places that are downwind from the data center um, in a place that also gets hot. Um, and so I think there are some other environmental concerns within Phoenix, Arizona, um, that they are not necessarily able to tackle at the city level that they have pushed up to the state level because of water and electricity. Um, Phoenix demonstrates really just like a little bit of how you make data center policy based on sort of your different contexts and also being able to think about how do you think about data center policy in terms of regulating it with people in mind and how do you make sure you're balancing out data center and commercial regulations with how do we want people to be able to perceive these things. That was one thing that came up in our conversations was just making sure that these data centers are not are not intrusive in people's lives in terms of them seeing them, they're hearing them, those types of quality of life concerns. Um so it provides a really good template for that. St. Lewis um provides similar context to Minneapolis because a lot of what their data center conversations are about are about how do we use data centers as a way of rei helping revitalize some of downtown because they have a lot of vacancies. They unlike Minneapolis unlike unlike Minneapolis St. Louis has been having population decline over the past decade, which is different from our kind of stable population, but they do still have the data center um the downtown data center conversations that happened. Um and also there's also already some small and medium-sized data centers that are there, but this was sort of triggered by a large data center proposal um that was happening. Um the policy conversation really is regarding larger facilities within St. Louis. Um they're trying to currently create a framework um but a lot of their concerns are flooding. Um so they're working on how do you get how do you get um data centers from flood from flood planes. Um they're looking into how is there ways for us to be able to look at megawatt um utility regulations. Um of course working with their state legislator in Missouri. Um but really a lot of their zoning frameworks are focused on the larger scale ones, but they're currently what two weeks ago they're still hashing out sort of the details and the amendments around there. But just something I wanted to highlight them because they also came up as like a they're trying to repurpose and do some of similar stuff that you're doing as far as like how do we take empty buildings and kind of fill them up. Um but that is something to watch um around St. Louis. And then lastly and maybe one of the more restrictive data center policies that I saw was Atlanta's. Um so Atlanta established definition for data centers and also establish at even though they had 30 data centers they sort of wanted to have more human design. So they ban data centers out a mile half a mile within any transit node which they have the martyr system which is a very extensive um system that replicates DC system but they also um had a half mile um barrier between the belt line which is a greenway that goes all around Atlanta. Um, and so that buffer between those two policies, some press call it basically effectively a ban on data centers. There was a special hearing for reszoning to allow for a data center within that parameters. Um, and I don't think that fared well for the data center developer. Um, so it does but that sort of offers a little bit of because there are some special um exceptions that can happen with public hearings and public engagement. the public is then allowed to say, "Hey, we actually want to uphold this current legislation and actually not have this within this sensitive area because ultimately their policies were really geared around how do we make Atlanta a people centered um or a people- centered place and not somewhere where data centers are going to take away some of the people centered work that we tried to do within our own new urbanism policy. Okay. So um when benchmarking Minneapolis proposal um kind of looking at what CP is proposing and kind what we see nationally um generally CP is consistent with what we're seeing in national trends um they're moving towards a standalone definition applying development standards specifically to data centers um having a level of review and a level of hey making sure that you have a letter saying you can meet the demands both water and electrical. Um there's some differences as far as there's no with CPADS proposals there's not stratification of data centers it's just it's just data centers at 175,000 ft of white space uh square feet of white space and also along with that whit space is between the six uh ordinances they are not using whites space as a marker for square foot limitations they're using overall square footage when speaking with them and talking about the white space. They said that that was a very I'm trying to say this in a when I say interesting I'm not from Minnesota so I do mean this in a very genuine way isn't it was they said it was a very interesting proposition to be able to make that as far as like being able to see like where you just directed to the server space. Does that allow for more data centers or does that actually disincentivize data centers? And also is that fitting for them? Because like guys, if you look at all those cities, those cities have a lot more sprawl and a lot more green space. So they're looking at it from a overall um square footage versus with us being a pretty densely populated city um relative to other cities in the country um we're looking at it well what are you actually using space for? What are the actual technology demands? Um, and so that was something I wanted to say because that makes it hard to compare these policies. So, first of all, all of these policies, it's really too soon to tell whether these are effective or not. Um, the oldest policy is 2024 and so we're still in a wait and see period, but also it's going to be very difficult for us to compare these cities to other cities because we're using whites space. And that is something even when looking outside of this six kind of bucket there something that's very unique to um what Minneapolis is proposing is the use of white of use of whites space um which I thought was was very um fascinating um along and so that's sort of the comparisons you have the chart and it's also within the LRO report but I do want to get into some areas considerations and some key takeaways. So key takeaway is that context matters in all of this. Um it I think a lot of the con conversations have been either you're yes to data centers or you're no to data centers, but it's really just so contextual that you have to take all the context within it. Um and it's a very nuanced conversation. Um, the impacts can look very different based on the size of the facility. What's what's the grid that it's using the energy off of, based on what's actually happening in the facility itself, whether it's using a trying to support generative AI, trying to support um your Netflix login, trying to support crypto mining, which is this own little thing right here that we're not going to touch right there. Um but really that's sort of one of the things is context matters. Minneapolis electrical infrastructure is pretty robust. Um and we have protections that help protect rateayers from paying more as a result of these upgrades um from the Minnesota Minnesota state legislature. Um and they could be stronger, right? But that we do have some of those square footage is not directly correlated with megawws. Um, Minneapolis water infrastructure is pretty robust and we have the ability to be able to support data centers. Um, we have a lot of water capacity there. Um, and overall it's too soon to tell both from the policy standpoint and also from an economic and fiscal um, impacts. Um as far as for you all um areas consideration um looking at all of this take into consideration at this current context hypers scale data centers um is seems unlikely in Minneapolis because at this point the technology requires for there to be a lot of space in order to get to the hypers scale. Now I do want to caveat with saying if you're talking about the efficiencies of space that there are are technological advantages um advances that are happening that are making more megawws being able to fit into smaller spaces. So I put a very big currently right now is highly unlikely for Minneapolis to experience a hypers scale data center which has all of the stuff happening in national news but that doesn't mean that is an impossibility um ever. So that's but I do want to say currently right now very low high likelihood of hypers scale. Um the bigger sort of more actionable items is that public engagement education seems to be super vital. There is a lot of misinformation, a lot of misunderstandings about what data centers are and what data centers aren't and how we use them and also whether they're going to create all these jobs. There's just a lot of noise out there. So but this creates a really good opportunity for us as a city. um enterprise to be able to educate educate our um residents on here is here are the facts and also here's where Minneapolis stands because ultimately if you're in rural Georgia versus being in Minneapolis those are just going to be very different and a you see a lot of videos coming from places with less regulation and less infrastructure than we do. Um at the same time also understanding that that regulation is not because of providence right this is because of the hard work that we do and so being able to have that engagement and education would be super vital um and it's something that I learned from all the other cities and also finally state and regional advocacy is going to be very important there is a bucket of things that we control as a city particularly zoning and land use but we as we've discussed in this presentation there's a lot of things happening as far as the impact of um data centers um and touches a lot more than just Minneapolis um can control. And so it's going to be very vital for the undergovernmental relations um department along with other parts of Minneapolis to be able to advocate for better regulation that fits and aligns with what we want as our end goal um which we would develop through public engagement and that's particularly within the uh affirmation megawws electricity uses and being able to connect with the public utilities commission to be able to advocate for what we want to see in Minneapolis as far is a sustainable future where we have data centers that are not sucking up all the resources and all the water and all electricity. Um, but I take state advocacy. That is my presentation. Um, I don't even look at how long that was, but um, I'm open to any questions that you might have. >> Thank you so much for your presentation. It's perfect day actually. We have plenty of time to ask a lot of questions. I see my colleagues here. I will recognize council member Tuktai. >> Thank you, Mr. Chair. Um, thank you for this presentation. Um, first, uh, I, um, I I really want to talk about the impact on on climate. Um, and I'm sure that this is this is the this came up a lot in your conversations with peer jurisdictions, um, as that's, you know, the area of of primary concern in a lot of ways, um, with with data centers in the public conversation. Um I don't know of the examples that you lifted up what type of uh goals or policies they have adopted around um around their um carbon footprint goals or their their climate goals broadly. Um but since all of these examples are from the south, I don't imagine good things about it. I don't imagine that they are as ambitious as Minneapolis is um about reducing um our our carbon footprint. So can you talk about whether you in in the analysis that you've presented to us whether that was um that came up in conversations with peer jurisdictions and what you can tell me about um considerations that we need to weigh um around our city's uh climate goals. specifically with the commercial and industrial sector. [clears throat] >> Great. Um I did speak to cities about um particularly what their distribution of electricity was. Um particularly Louisville and Birmingham. I spoke with Cincinnati but did not mention them because it end up not quite fitting into like the learning because they were in an overlay district um temporarily and then developing it. So they're a little bit more behind. Um and a lot of them are like still dependent highly on coal um as a state which is why the cities which generally lean more aligned with the things and ambitions of like want to have sustainability um overall try is trying to work to how to limit this real big resource suck on climate. Um, I think one of the things with the climate policies of Minneapolis and climate goals, um, is because the wrinkle is we're getting a greener, um, grid over over time. Um, and so it becomes it was difficult for me to be able to really land on a this is out of alignment or this is in alignment with the um, with the climate goals. Um most because I didn't have necessarily hard facts and data because we don't have necessarily the greenhouse gas emissions of all the current uh the current I don't have the data um on the current greenhouse gas emissions of those um facilities based on other ones um and other commercial uses. I will say one of the one of the harder and stickier objects of just the CL of I did my climate research within this is that with data centers and the businesses where they choose to go they're gravitating towards the places where you have lower regulations. Um, and they also are going to places where there are less green gas emissions because those places with low regulations generally have less ambitious climate goals. And so a lot of it seems to me that putting data centers in more green grids or places where you have more climate um I would say more climate positive policies would get people towards the kind of greater goal of creating a more sustainable future overall and reducing overall greenhouse gas emissions. Um however I wouldn't look into the details of that. I do think that for data centers themselves they do create a lot of greenhouse gas emissions if the grid is creating a lot of greenhouse gas emissions. Um everything in the data and I just using compared to other states Minnesota has a pretty green um one of the greenest um grids in the country. Um so that's all I can say on that. Whether that is ambitious enough, whether that is good enough is not within the research but is within the policym. >> Yep. 100%. Um, yep. Um, here's what I here's what I'm worried about or what I'm trying to get at in the question. Um, Minneapolis [clears throat] has really ambitious climate goals. That's a fact. But in the way that we approach those climate goals, we there's a lot of of nuance that exists there. Um, a fact is that we could decarbonize every single residential property, every single residential um, unit in Minneapolis and we still would not meet our climate goals because of the emissions in the commercial and industrial sector. The commercial and industrial sector uses more energy than the residential sector does. Um and and it's one that we have struggled to re in over the years um because the decarbonization at that scale is is difficult but frankly because um the actors the players in that in that industry don't want to because it's cheaper not to. Um, so knowing that we have ambitious climate goals, knowing that those ambitious climate goals go along with tens of millions of dollars worth of investment in meeting those goals in our region and in our state. Knowing that the commercial and industrial sectors um, energy consumption and and carbon emission far outpaces residential. and we cannot meet our climate goals without significant reductions to energy usage in the commercial industrial sector. Is there a is there more information you can provide to me about the impact on the commercial industrial sectors energy usage and like projecting that out based on different types of regulations? Um, yes, through the chair. Um, council member Shaktai, I don't have that information on hand. However, um, thank you because I can look and see where I can scrge up between now and w and Wednesday when we have our legislative lab next on the 26th. >> Oh, great. >> Yeah. And if I can and if I can't find anything, then I will of course like anything I will tell you straight up I could not find anything. Um, I do think your concerns are valid because if the if we're trying to just reduce the amount of electricity overall that we're creating and that the commercial sector is causing a lot of car a carbon footprint on that, then I think you're making you're connecting the dots. Um, I would probably follow up and just get more um details about the question just to make sure I'm getting specific things on there. Um, but I think that's a really good question. I will my hypothesis that there's a lot of things particularly within data centers that are it really depends um but let's talk more and we can learn I can see what I can find >> that's really directions >> thank you >> I might not find anything but I want to try >> thank you that's all madam chair >> thank you next we'll recognize council member Chavez >> thank you chair chowdery I want to thank staff for the presentation if we can please go to page 21. Slide 21. [laughter] >> So slide 21, yes, shows CPATs proposal which was released on Friday. And I know there was a question about what particularly is the overlay district outside of downtown. And based on the update we got, it would allow properties in RM3, CM1, CM2, CM3, CM4, PR1, and PR2 districts to apply for a data center overlay. And as proposed on Friday and under consideration, the areas of the overlay districts would include industrial parcels bordering Little Earth, the roof depot site, East Lake Street, and parts of Haywa Avenue South and Bloomington Avenue South, including parts of the Southside Greenzo already carrying a disproportionate burden of pollution. I have been raising the alarm since day one that there would be attempts to build on our environmental justice zones, and I was told to not be concerned, and I am. And I'm using this opportunity to raise the alarm bells for neighbors to be aware and let folks know that it is time to organize before it is too late. My constituents fought hard for the roof depot site to get the East Phillips indoor urban farm project. They fought hard against the Smith Foundry and Batuminous Roadways. We do not need a setback and as currently proposed and under consideration, it will be a devastated impact for my neighbors, for my constituents, folks in the southside green zone in our envir environmental justice zones. So, I wanted to use this opportunity to let the public know what we were sent on Friday and it should be a major concern for downtown areas outside of downtown where they would be considered on a onetoone basis. And what that means is that it could be built on Lake Street. Why do we need a data center on Lake Street? I'm sorry. That just does not make no sense. Thank you for this presentation. My comments aren't directed to LRO. It's directed to the proposal that is in front of us today that was released on Friday that will allow people on Lake to a developer to apply for a data center overlay on Lake Street at the roof depot site where the urban farm is supposed to be the dream of my community down highwa Bloomington Avenue South. It just does not make any sense. I clearly have not been heard throughout this conversation about the data center conversation which I have been very clear. I do not want them in W 9. Thank you. >> Thank you. I have myself next in queue. So, first off, I just want to start off by saying thank you so much for working on the research on this to you and the LRO team and CPAD. We've been spending like every every [laughter] month kind of checking in on this and we still have that legislative lab that's coming up before us. So, thanks for doing all of that work. Um, I both gained a lot from this presentation and also gained a headache [laughter] because there's a lot of information which I I honestly I I plan for. Um, I think it's going to be valuable for us to take this into the legislative lab because again there's just so much [snorts] information to process. I think the place maybe that I want to start in kind of using this opportunity to illuminate a couple things to the public. So, we have we have the 60-day common period that's kicked off and there's a website um that's available for that that um you can find uh if you look up data center city of Minneapolis, there's a web page that shares that. I think this piece about the overlay district policy consideration um I would just say as like an author on the regulations there's more work to be done and there isn't consensus from me on it. Um I think there is for me one there was already originally concerns about data center buildout primar primarily for one land use and then two the electron electricity usage of a data center um in the city of Minneapolis in general and then we did the carveout for downtown um and now this conversation entering into the fold of essentially property owners outside of downtown being able to um and ask for a reszoning to allow for a data center. So that's kind of where that conversation is. And I think to see that as a part of the consideration kind of so late in the game before the public announcement is something that is catching council members that haven't been a part of the policy conversations as authors offguard. Um, and that's that I just want to offer that because I also have a major concern about the overlay district conversation. Um, and I think it is one that's worth um, debating and hearing out. I I particularly don't want to see data centers happen in our green zones. Um, one of the questions that I had for you is more focused on water just to start. So I can appreciate that there is a high amount of capacity for water treatment available of 25 to 30 million gallons. Is it daily? >> Was that >> is it 30 25 to 30? >> Yes, daily. >> Daily. Okay. Um, I think one thing that I I kind of want to get a better understanding about in terms of treatment capacity is I understand that there is this availability and at the same time the city of Minneapolis is currently sharing communications around conserving water for everyday residents. Um, could do you have any understanding or could any staff speak to why the city of Minneapolis is asking residents to currently conserve water? Is it due to drought conditions? Is it due to treatment capacity? Because I think that's an important point of conversation in terms of water usage as it comes to available capacity if we're asking average everyday Minneapolis residents to conserve water. >> I don't have that off the top of my head. And I think that's more for um public works will have that answer. Um so I could reach out to them to get some clarity on we have d we're hearing two messages where we have tons of capacity and we also have a drought concern. So circle that square. >> Yeah. I think that would be good to bring into the fold for a legislative lab because like up until this point it's been we have available treatment capacity and then uh my team shared with me that we are sending two very different messages as a city as it comes to water capacity. If we are asking a single household to save water and then for a data center that uses water cons constantly um what does that mean? And then I think like something that I would like to better understand is kind of uh future labor impacts for treat the water water treatment facility. That's come something that kind of came new to frame in hearing your research and then reading the actual data center um research packet which I recommend every person read if they're super interested or at least every council member because it's far more detailed um than the presentation. And if you were to give that level of detail, we'd probably be here for five or six hours. But um I think it's really worthwhile. So that came to mind because it's the limiting factor isn't the water that we have. It's more so the treatment capacity that we have. And then in my conversations with public works, um there was there was a sentiment that was shared that depending on a high capacity water day, they're checking in on their workers and their ability to do the treatment work. And so that's something that I'm kind of wondering about again like that we're saying conserve water and then what are impacts on increased water usage um if we allow for several more data centers to be built out in downtown. Um, another question that I have is, uh, in terms of the fiscal benefit or impact, um, you were kind of laying out that there was, um, the state level tax break that was given to data centers um, and that there could be an impact on local governments. Could you speak to that? >> Yes. Um that actually was the last piece of data that I received. Um so for Minneapolis, so the tax exemption for sales tax exemption came in 2012 um to incentivize data center development um during the during that era. Um, and cumulatively, I will want to double check, but around $7 million in tax um, in sales tax exemptions from Minneapolis sales tax has been given since 2012. So, back of napkin math, that's around $400,000 a year. Um, that's an average. It's not there were some years that I'm sure were higher than and lower. Um but yeah, that's sort of the fiscal impact of that particular policy. I have some other numbers for other um local impacts, but that's at least for Minneapolises. >> Do you have the number on like statewide what that figure would be? >> I think that was in I've looked back in my email and my communications, but I can um I think I do have that number. >> Okay. Yeah. And so essentially that $7.4 $4 million could have been money that would have been able to come into what we collected for taxes as a local jurisdiction, right? Do I have that understanding? >> In theory, yes. >> In theory, yes. >> Yes. >> Because I think this that's this is one of the things that I was hoping that we can get a little bit more at the heart of is just the understanding of just the economic impact. And there's been a lot of conversations about how this is going to be such a great revenue generator that this is the type of um use that we need. Uh oftentimes elevated in my view to the point of like okay like if you want to address the the city's financial concerns and you got to get behind data center development. But from my view reading this is one with the with with the tax breaks impacting localities we we've there was a chance for that 7.4 million in theory to come to the city that didn't. And then in your reporting would it be accurate to say that um data centers cannot be conclusively said to be a revenue generator >> given assessment science >> that's a big question all right so first for the correction I think the big thing with is looking at the re is but for so like what we don't know is would those data centers have co how much of that data data center coming into the Minnesota or Minneapolis market would have been is caused by the sales tax exemption. Um there are some studies in other places. We don't have that particularly for here in Minneapolis. So it's it would be inaccurate to say conclusively that status 7 million that would have that would have definitely been tax revenue because some places some um developers might have just chosen a different place with um where it they didn't have to worry about the sales tax at all. Um, so that's the first the first portion when it comes to data centers and revenue and general revenue. It's really it's hard to say within the Minneapolis context whether more data centers will in will it's not whether they will increase value, it's just by how much. So then developing here's what the economic impact of these data centers will be is opaque. Um there have been some studies in I would say in the data center capital of the world in Nova um in Lowden County where they've actually done math on like this is how much money these data centers generate. oftentimes that is on the counterfactual that that is an empty field that is generating very little tax revenue and it goes from generating very minimal tax revenue to an industrial use which is different from our situation which is these are generally current buildings that could be built into other things um and also not coming from completely zero which is why it becomes it's hard for whenever your statement saying that they don't generate um revenue Uh I think that would be a bit too far from based on the research. It really just depends particularly on the Minneapolis market whether they gen whether a data center in this building how much it would generate based on other uses of the building which that's take a lot more a deeper analysis um than what was in the scale for this report. So I don't think I could I don't think I can say with confidence or affirm that data centers do not have revenue impact. I can say that their revenue impact is opaque and it is difficult to say that well what would be the tax um the tax development or tax revenue from data center development. Um that's still kind of fuzzy but we do know that there's something there. there is a there there we just don't know what it is. Is that helpful? It's a lot more confusing than >> that's exactly what I expected you to say and I think like just bottomlining what came out of it is that one there's more research to be done and two it's just not conclusive. >> It's not conclusive. >> It's not conclusive. And I I'll just read for the report. it. Although data centers may increase the assessed value of individual properties, increases in assessed value do not necessarily produce proportional increases to municipal revenue. And I think that's like a big takeaway for me in this research is we as policy makers in Minneapolis can't substantively say that this is a golden goose for the city because it's opaque and it's not conclusive in terms of that type of financial impact. And for me I think there's factors to consider in terms of the tax breaks that are given at the state level too. Um, I think I'm going to just stop there and then get back into Q and then I'll recognize um, Chair Osben and then also pass back the chair. >> All right. Um, thank you so much uh, for that presentation. This is probably the most unknown topic for the entire um, city and our residents. It's, you know, we're learning as we go and so this is very informative. Um, I'll just wait until we see the proposal to probably ask more questions about the zoning and how that uh will affect our residents. But uh my question I have a couple questions. My question to you is what exactly will count as a data center um under the city proposal or what do you have seen um you know data centers from a small server small organization um or computer hardware like when is data center data center >> I think I'm going to pass the mic to my CPAD colleagues over here to get more in depth what is a data Thank you, Chair Osouth. Jason Whittenberg, CPED planning manager. Uh, from our standpoint, when a data center is serving a use that's not on the same property, it's going to be regulated as a data center. If a regional bank has a has servers that that uh serve their bank and and only their bank, they're not leasing out space in their uh in their server room for third party users. >> That's just an accessory part of that business from our standpoint and would not be regulated as a data center. We are considering a rule, however, that if a a business is only serving its own own needs, but the the server rooms take up more than a certain percentage of that overall floor area of that business, that then we would regulate that as a data center potentially. >> Thank you. >> Microphone, >> sorry. Let's keep going off. Okay, here we go. Thank you. My question is who are these data centers serving? Um, I know it's a commercial use, but and we might not have a lot of information that they don't want to share, but who are they serving? I mean, we hear about Chinese drones. We hear about are these like outside uh the United States servers like countries like United Arab Emirates are over um are coming here or different countries coming here to use uh this space who are who are they serving dayto-day um and how do we know um you know if they're local if they even in the country or have you find in any of the information the the magnitude or the groups that are pushing to bring this to the city. >> So, um have not spoken to folks who are like DE I've spoken to some D center developers and even speaking with um folks like greater MSP that kind of does a lot of sort uh economic development in the region. Um I think the short answer is that they serve everybody who uses a digital footprint in some way, shape or form. Um because even speaking to like we went to a data center um that has 20 different clients and some of like some of them are Netflix where they're like pushing out Netflix um um Netflix uh videos. Some of it is like Zoom. Other ones are they're a little more secretive. Um, there's a lot of secrecy based on my impression. This is getting closer to Dwight's analysis of the situation. There's a lot of secrecy within the data center field because they're dealing with information. And so by that by like almost nature of the job, it is how do we make sure we have levels of security and privacy about people's information that is there. um a hospital with that uses the data center would not want you to know that that place right here is where all of the hospital data is at cuz then that becomes a target especially when we get into um AI agents that are using for hacking who they really they don't necessarily even need to sleep in order to can relentlessly attack a location once they find that there's a particular p a particular sensitive data that's within a said building or that's connected to a client. So there is a lot of secrecy around that for security reason reasons. Um but I would say broad answer is anybody that uses some sort of internet presence or has an internet presence is using a data center. Um so those are the folks who we might consider bad actors and also the folks who we might champion and cheer on. >> Sure. Yeah. I I think the important thing to consider is that you know data centers for hospitals and all those those are great things you know but um just the things to consider because we the other topics do come up about you know uh Chinese use drone is not allowing them here or information like that but uh but also knowing who is behind these data centers and if these data centers arrived in Minneapolis while we argue about the zoning uh I mean how much how many are we using? Are we city Minneapolis? What if those data centers are only strict in Dubai or Qatar and places like that are that might not have the climate we have here in in the winter time? just just something to consider is that there has to be some kind of benefit use to the state or the country um on that data centers and I will have definitely a problem just outsourcing because you have a a different climate in the world and you want to outsource in Minnesota to do your data centers that will be something that I will be very concerned um keep it moving um and and I I look forward learning more I I'm really not against you know um advanced technology and and bettering but but it's very really to know uh and everything about secretive and security if that is the shade we're going to do uh it will be very difficult for for us to for me to definitely um not know what I'm signing up to. So I'll just say that. Thank you. >> Uh I'll consider council member Schaefer. Thank you Dwight for this really great presentation and really being able to give us this whole book ahead of time was really helpful for me to be able to read through and just uh kind of looking at the comparison cities. Um it seems like having we're a little bit unusual in having one set of regulations would you say that's pretty pretty was it not unusual or unusual? I just was curious if that was um >> I'm focusing on this the term un sorry through the chair uh council shaver I'm focusing on this unusualness it's it seems to be more of a trend with the data with the with the cities that they're they have some type of tiered system >> tiered system >> um for data centers um >> Birmingham, Louisville, Nashville um being the ones I know Phoenix they do percentage based of buildings which which is kind of an outlier. Um but yeah, so it's not we say it's unusual. It is it is something that we don't do. We are just saying is we have a upper limit and anything within that is sort of >> right >> fair game. >> I was just saying I think that's a great approach to be more streamlined versus trying to slice and dice. Um other than then maybe we're other we can talk about that later. But one one question I had was um in the comparison with the other cities overall, would you say Minneapolis's um initial regulatory framework was more restrictive, less restrictive? I mean, is it hard? I know it's a little bit of apples and oranges here, but how would you say overall >> because they had the tears, right? I think with the added context of where we are as a state level, I think that's the other thing where there are certain things that the cities regulate that that they try to legislate that we have sort of state backing on. So I think that's a so within what I can tell Minneapolis has a bit more stronger um like we're not allowing for 200,000. I mean, I guess it depends on white space versus like regular overall square footage. Um, but uh yeah, it seems like we are a little bit more probably a little bit beyond the me median of restriction. um as far as like being able to have a stronger regulatory framework. I do think that some of the things that we have the advantage of and CPAD has really used this advantage is because we're not the first one through we're really taking lessons from other districts and seeing like here's what we can use. Um, so I do think there is a level of I would say I don't want to say I guess I want to say sophistication. There's a level there's a level in which they're matching they're meeting in the moment and meeting the market that we don't necessarily have to worry about other objects there. Um but to answer your question more directly, it is slightly more restrictive and stronger as far as than the median of what's in the in our basket of goods here. >> Sure. Like no new data centers being able to be built and things like that. >> Yeah. We're not allowing Yeah. the new which a lot of these folks they're like wrestling with the fact that are trying to build from the ground up which is something that is on the C is not an allowable thing to happen um under the CPAD proposal. >> Yep. Right. And I think the other thing I took from this is that there are some points that we may want to add to our IG agenda you know going forward whether it's around the sales tax maybe um you know some of looking at some of this megawatt stuff. So, I really appreciated kind of hearing hearing some of that background. I would like to speak to your your slide where you said it was too soon to get a full picture of kind of the economic fiscal impacts. Um, I totally agree with that in terms of revenue. Um, I think where we're maybe a little bit different is that we actually are saying multiuse. And if we have a data center solely versus a new data center multiuse, the there is this potential for driving revenue, whether that be through retail space or additional density. Um, so I think that was a nuance there that maybe might be helpful to point out um, in thinking about additional revenue from a multi-use data center versus a strict revenue increase from a a sole data center. Um, but I do think it would be interesting to have an understanding of the pieces that we do know would have an imp you know economic impact around um, franchise fees. I mean, that's something that's a known, right, that we could have um a fuller picture. It might not be the fullest picture, but more of a picture. I think there's data we could find about economic impact around that for our next meeting. Um, and then maybe if there's some idea around a multiuse data center versus a sole data center, would there be a little bit more revenue? I know that's a little squishier, but um that was one idea. I think the main thing that might be helpful to point out as an economic impact now during this budget season is just the understanding of shifting it's not increasing property taxes necessarily, but the the shifting of the burden >> a away from the residential to the commercial as we see the valuations increase. I think that's the message that is something that is part of the picture that we don't see the full picture but that's something that we can specifically point to that we have data around one building and understanding if a building goes to an eight times valuation um they're taking on a greater percentage of the property tax burden right and what would happen if that happened to eight buildings across our city or six buildings um for that kind of an eight-fold increase. I think that's that's data we can kind of get to um about how that would eventually shift [clears throat] away from residential, not immediately um because we've seen such a great devaluation of commercial property values, right? But over time, what could that mean? Um and again those are hard you know [snorts] strong numbers to get to but I think there are some elements that we could get a greater picture than what we were presented here today. That would be my only feedback is I think we could have some more data around some of that uh fiscal and economic impact >> um from what we currently know. Um and [snorts] then I guess I would just say could we go to do you happen to have this book with you? >> Yeah. um page 50 in this book. Um and this is something we can speak to maybe during the ledge lab, but um you gave you made it very clear that you know the Minneapolis megawws to square footage guideline is not um a science obviously, but the numbers that are given here would these obviously be um total square footage numbers, not whites space? >> Yes. >> Okay. Thank you. I just because it's kind of different than what we were seeing. Um but I think thank you for clarifying that. >> And lastly, I guess um maybe this is a question for CPED, but are there going to be questions like can you speak a little bit to the format? Will CPED be included in the LED lab? And what will be the format? Will we be able to ask questions specifically around um why the you know the um PR2 was removed and can we can you know tell us more about an overlay district are those questions that we can ask during the ledge lab? >> Yes. the way we're designing Ledge Lab, it is more um trying to facilitate a discussion because ultimately what we're trying to do is make sure that a you feel informed to be able to inform your constituents, right? But also that you have an opportunity particularly for um the proposal to now that you've been armed with the contextual information, now we can get a little bit deeper into like what does this mean for Minneapolis particularly with the CPET proposal. So that's going to be a major portion of it is more Q&A responsiveness to the present to the proposal. >> So So we should come prepared with our questions. >> Oh yeah, always come prepared. >> And then one final it's a trivia question. Is Cordia um hooking up with steam or hot water? >> I want I can look it up on >> hot water, but I have to look that I have to look that up. Steam. >> I thought it was steam. That was a and it's maybe a little bit harder to hook up to than hot water. Is that what I've heard? >> Yes. With steam particularly, you have to get it up to way district energy works. You would have to get it up to temperature because it doesn't come out with just it being ready for steam. So, they would have to use energy in order to be able to get that to steam which adds to difficulty. >> Thank you so much, Dwight. >> I will recognize council member Rainville. >> Okay. I'm going to try and be brief here as you've been very patient. Uh so first of all, thank you and I appreciate the cooperation with CPED. I know you mentioned public works many times. This is truly why we have this legislative department. So thank you for all this great information. Uh uh for and maybe you can't answer this question today, but you had talked about the sales tax, the 7.4 million in sales tax. Isn't the sales tax uh go to the state of Minnesota? It goes to the state of Minnesota and it gets redistributed back to the city which is how they have the data. >> We get peanuts back. We get pennies on a dollar back >> from what I'm speaking with them. I mean that is that's your words, council member Rainville, but >> Well, it's true. >> Yeah. >> Okay. Thank you. So, uh and then uh just the other and and maybe you can uh kind of builds a little bit on what council member Schaefer said. Uh so we're looking at is there an economic benefit to a data center? Is there not? You know what is the truth? So the sleep number buildings sold for 20 million a couple years ago and then it sold for 235 million. So that's a little over $200 million and just roughly to me that appears to be about $4 million more in property tax revenue uh to the city that residents do not have to pay. So maybe you could just understand tell us next week exactly how much of a increase in property tax that was for that one building >> through the through chair um council Rainville I so I spoke directly with the assessor's office when making um when developing the research and asked them that direct question and the opakeness that you're receiving from me was reflected from them as far as like there's so much that is unknown Um, so that's why that's why I'm saying that with the assess value like I'm using that because that's what they were saying. Um, and that's sort of I defer to them as the experts on assessing values of the building. Um, I think some of your points around the when you talk about economic talk about the value of the building itself is probably there's the other but for of like well if you were to not have this what would be also the tax revenue. So that's something we would have to look into. But um that came from the assessor's office. When I say there's ambiguity around that, that's because from the assess my conversation with the assessor, that was the ambiguity they reflected. >> Sure. Well, just to humor me, could you take another run at the assessor's office? Because to me, in my world, if a building sold for $20 million and then it sold again a couple years later for $235 million, that's an increase in property tax revenue. millions of value. So, uh, but back to my original questions, um, I I think you should, the staff should listen very clearly to what, uh, Council Member Chavez has brought up about these uh, districts and Lake Street or Hayawa. Uh, because I I was not allowed to be in on the policy conversations as well. Uh so I don't I don't know how this all went but I would think it's very reasonable to uh listen to that request to not have these even if it requires extra set of permissions but let's ally that fear let's just nip that in the bud and honor you know his request. Uh and then lastly uh I just want to uh talk about what I personally took away from your your last uh set of facts that hypers skills are unlikely in Minneapolis that we don't have the land to do that and uh listening to the council we probably wouldn't uh allow that to be permitted. Uh but most of all that uh the opportunity that that we're we see in front of us that we have to take advantage of is publication uh public education and public engagement that there's so little known about these modern era data centers. How they've morphed from individual computing centers into these data centers and what exactly does that mean? What is the impact on us? Uh so that that is uh really good that we don't have this misinformation out there comparing us to an Alabama or or a Phoenix, you know, these big big mega centers that suck all the water out the ground and there's not enough electricity. So, uh that's that's my big takeaway that we have a lot of work to do here both as council members and as staff on the education side. So, thank you. >> My pleasure. >> Thank you, Council Member Inville. I'll recognize Vice Chair Chowry. >> Thank you, Chair Osman. Um, a question that I have is that in um the printed out report on page 16, [snorts] there is a mention of alternative cooling technologies um that may change the facility's no noise profile by reducing reliance on large number of conventional air cooling fans. Could you just speak to what that system is? And then also there's something about um the hybrid cooling systems as well that can both reduce the num amount of water used and the amount of electricity used. >> So um direct cooling um systems. So instead of so right now water goes around the servers to be able to cool indirectly but direct cooling allows for liquid to go directly like basically cool directly the chip itself. um which is which is almost like think of it like instead of you casting a wide net, you're being a little bit more precise with what you're actually trying to cool because all of it is to try to cool the chip itself to keep it from overheating so that you can continue on with the data. Um this is something that was a is a newer technology. It it reduces the amount of water. Um I have not seen um exactly how that does to reduce the overall infrastructure that is but based on just general trends they're trying to figure out ways to make things more efficient and have more space because the more space you have like there's an economic disincentive to have big sprawling data centers because that costs more money. If I can do the same thing for small less space and less water that I'm having to pay for and less energy that I have to pay for that is an incentive for me to make it more efficient. Um, and so that's the new cooling technology that's there. I wasn't able to f I wasn't able to find really great examples at scale. Um, because I was, as I'm doing my research, I found out about this technology sort of in the 3 weeks before the presentation was due. inclusive in as you know as research goes. Um and so I do think there is an opportunity there. You were mentioning the hy hybrid systems because some systems use a combination of water based cooling and air and air conditioning. Um and so they're using kind of a mixture of things. It's not just like with any hybrid system. It's not the same percentage of it. So it's just they're trying to figure out ways to reduce the amount of energy that's used because I think and this is maybe a broader point. It does not it does not save data center facilities money using electricity and water. They want to reduce that amount because that saves them money if they can deliver the same product. Um and so that's why there's so many advancements there. Um so hopefully that answers your questions. Just to kind of wrap it up on this question, direct cooling technology directly cools the chips themselves um with liquid agents and instead of doing it around the servers and um also the hybrid is just sort of a mix of air cool like particularly with some of the um because we're in a cold environment being able to some some of them leverage the cold environment around them in order to reduce their energy usage. Um, so that is a little bit more. It's hard to play one fitsize fit all of that. >> Absolutely. I feel like that's like kind of the theme of the entire data center conversation. There's nothing that is a one-sizefits-all. >> Yeah. >> Um, >> yes. >> That and I kind of wanted to highlight that like getting into the nuance of like cooling technologies and like these different levels that impact like energy uses versus water usage. I just want to bottom line this and this is like been a primary concern of mine since we started on the regulations and like why I think the moratorum has been really important is as a local government we do not have the ability to regulate those specific components that limits our authority to control for what we need for the city of Minneapolis and that's why like it's going to be really important for us to have a big piece of the state level conversation at the state legislature. We [clears throat] can't require a certain cooling system or not even if there's like a benefit to it to our community um or lessening impact, right? That's something that we are prohibited at the state level from addressing and the same thing for regulating by megawws. Um, and that kind of brings me to my next question is could you kind of speak to how the growth in AI and cryptocurrency has changed the amount of compute power necessary and and electricity usage that's necessary for data centers. I can speak to it. I do I will say within this portion of it I don't have specific numbers as far as megawws or water usage but I can give at least broadly the theory around it. Um cryptocurrency vest sort of a bit simpler because crypto is created based on solving problem like solving mathematical equations in order to create the value of the of the bitcoin or whatever the cryptocurrency is. that computation requires computers constantly running the calculations in order to be able to create the create the Bitcoin that then does have value um in a very broad sense of it. And so as you have more demand for cryptocurrency that is going to increase the energy needed especially if you have more advanced crypto that requires more security that's going to require more energy and higher computation power. Um, similar with a similar to AI. AI a lot of it is really just train like data centers are used to train the module which of course means that you're trying to get tons and tons of data to be able to siphon it into the AI model and so that it can learn as much information and data as possible. Um, and so as you want more and more as you get more and more um AI um advancements, it requires more and more complex data. This is aside to even machine learning models also require is taking tons and tons of data and then also taking the d anything that it creates and using that as kind of a backfield for continually improving the AI model. Um it's just with the more I think a better way of even putting it is like the more complicated a thing is that you're doing on the phone or on your computer the more data and more energy it's going to use. I think maybe a broader sense like I think a lot of what we've done in the digital age is we've divorced ourselves from energy use and our phones and what we're doing but every time we're on our phone we're using some level of energy. the more complex things you're doing, the more energy you are using. Um, and AI is probably the most complex thing that we've created along with cryptocurrency, which is why we see those computation demands jump and also the need for data centers have jumped as well in order to meet that demand. And that um goes to what something that I was struck by in the report is that advances in computer technology have weakened um the relationship between square footage uh as an indic indicator for development in intensity because of the growing use of artif artificial intelligence. um basically being able to do higher compute power in less space and bas and use more energy in less space and that's why for me the hypers scale conversation in terms of acreage for sure probably not going to be able to do that in Minneapolis but if we're talking about energy usage and if we're talking about energy usage across data centers and what we're using we are going to be if we allow for it using high high amounts of energy and also that's why the square footage metric that we're using to indicate for development intensity is just going to become outdated over time if not already outdated by the time that we pass something. Um the last thing I just want to touch on is I think that conversation around AI and crypto is one that we haven't really brought into the deis but is a part of what con I hear from constituencies is this AI and technology and ethics conversation of okay we're we're having energy usage for data centers that are using artificial intelligence that hasn't been regul ulated at the federal level or the state level. We are seeing right now that um Elon Musk is trying to sue the state of Minnesota for banning AI notification technology. We also know that there have been writers um and poets who have had their work stolen by artificial intelligence companies that train their models and use energy for that. And I think that is something that constitu constituent frustration comes into the fold with these data centers, right? And that's something as policy makers, even though we're talking about land use and zoning as our tool, because that's the one tool we really do have, we can't divorce the topic from that conversation. Um, and I kind of wanted to introduce it into this legislative research piece of it because it's just it's just there. That's like the big elephant in the room. Like why are we talking about this giant data center intensity that's happening right now in our communities? Um, and I just want to bottom line for constituencies so they're clear that are listening on like at the city level what we are able to do right now the tool the main tool that we have is zoning and land use. we are not able to regulate these other portions and within this report um the state is at the top for utility regulations, water appropriation, environmental permitting, economic development incentives. Um and I think we need to keep that in mind as we advocate for things that we need. And I'll just say the biggest concern for me coming out of this is twofold. It's like what do we want to use our land for? And I think that's what we get to have a say in in this conversation. What do Minne how do Minneapolis residents want to shape our city for the future to come? And then the other is the existential threat of climate change. Right? Even if Minneapolis and Minnesota has a greener grid, we are not at 100% clean energy. I think we're at 63% clean energy. Meaning that there is still energy that is unclean that is being used. And if you have a use that uses 50 megawws, which is enough to power 50,000 homes, you are amplifying the amount of energy that is unclean that's used that leads to indirect emissions. And then of course there's direct emissions from the diesel generators that power those data centers and those need to be tested monthly. So I think those are all just kind of things for consideration as we move forward. and got a lot from this report um in in in that. So, thank you for that. Um those are all the questions that I have. >> All right. Uh colleagues, I want to remind us we have five minutes until captions. We lose captions. So, I will recognize council member Oh, I see no one else here. All right. Uh I just want to say thank you for that wonderful presentation uh that you have provided a lot of informative uh um information that we can use we can take. I um see no further action before us I will direct no see there no further uh discussion I will direct the clerk to file the report and presentation and see no further business before us with no objection I will declare this meeting ajourned. Thanks everyone.