Oregon city declares 'state of emergency' after statewide ban causes it to lose data center revenue

Umatilla, an Oregon city, has declared a state of emergency following statewide restrictions on new data centers, which threaten to cost the municipality over $6 million in anticipated revenue. These restrictions could disrupt infrastructure projects, employment opportunities, and private investments worth billions. Umatilla currently hosts four operational data centers, with another under construction and two more awaiting completion.

The city's financial projections include income from planned data center developments that would support major public infrastructure improvements, including a proposed police station and upgrades to municipal water infrastructure. However, interruptions to these expected payments could force officials to reconsider project schedules already incorporated into financial plans.

The emergency declaration focuses on potential financial losses rather than an existing budget crisis, as municipal reserves remain historically high. The restrictions, issued by Governor Tina Kotek, suspend environmental permitting for data centers until July 2027. This decision follows a previous halt in transactions involving state-owned land for such projects and an August decision preventing the sale of land in Salem for a Verrus development.

The emergency resolution requires reconsideration within 90 days and calls for Kotek to reconsider the restrictions without further delay.