Jefferson County supervisors provided an update on the county’s ongoing effort to develop a data center ordinance during Tuesday’s board meeting on July 7th, with Supervisor Lee Dimmitt outlining what has been included in the framework so far and what steps remain before a moratorium can be implemented.
The discussion was prompted by a question during public comments from a local resident asking about the status of the ordinance following the departure of Assistant County Attorney Elizabeth Estey, who had been doing significant work on the document. Dimmitt said the county now has a framework in place, modeled in part after ordinances from Linn County and Allamakee County, but that it is not yet finalized. “We have a framework. As a template, if you will, Linn County’s ordinance and Allamakee,” Dimmitt said. He said he had recently been in contact with County Attorney Chauncey Moulding to schedule another meeting to work through the remaining details, noting that Moulding’s workload has increased since Estey’s departure and the earlier retirement of part-time attorney Ed Kelly. “Chauncey’s got a full plate, because now he’s doing the work of three as opposed to having three people,” Dimmitt said.
Dimmitt said his goal is to have the ordinance passed by the end of August, at which point the county could implement a moratorium. “My hope is, by the end of August, that we can have this passed. And then by doing that, that would allow us to then implement a moratorium,” he said. He added that he would personally like to see the moratorium last at least 18 months. The process will include three public hearings. Dimmitt emphasized that the county cannot implement a moratorium before the ordinance is in place. “We can’t do a moratorium first because we don’t have county zoning,” he said. He noted that once a moratorium is in place, the county can step back and refine the ordinance further. “Once we implement a moratorium, we can take a step back, come back and look at the ordinance and maybe do it better. But we have to have something in place first before we can do that.”
Dimmitt outlined several key provisions that have been included in the framework so far, including cryptocurrency operations, various sizes of data centers, occupied buildings, permit fee assessments, setbacks and distances from city limits and schools, crop suitability ratings, proof of insurance, noise study requirements, and closed-loop cooling systems. On the cooling requirement, Dimmitt said it must be absolute. “A closed loop cooling system, and that must be absolute. But we also put in there, pending a better option,” he said, explaining that if a better technology becomes available in the future, the ordinance would allow for it.
Among the provisions Dimmitt said he personally pushed for is a requirement that all increased costs of power generation and usage be borne by the data center rather than local residents. He also said roads used during construction and operation must be paved and maintained at the owner or operator’s expense. “Prior to any construction, all roads used to a public data center during construction and operation shall be paved and maintained at the expense of the owner/operator per county engineer’s assessment,” he said. He added that any noise study required would also be done at the data center’s expense.
On crop suitability, Dimmitt said the county has not yet settled on a specific threshold but that protecting agricultural land is a personal priority. “When we pour concrete on farmland, that’s the last time that that land will ever produce anything,” he said. “I’m a big proponent of agriculture. I think that is one of our largest economic benefactors.” He added that the county cannot dictate who landowners sell to, but that the ordinance is designed to give the county tools to make assessments. “We’re not out fishing for data centers, as far as that part is concerned, but we realize that we can’t tell you who you can and can’t sell your land to.”
Dimmitt encouraged residents to attend the upcoming public hearings and provide input early. “We have a public hearing, so you come to the public hearing,” he said. “If the general consensus is, we want green shirts instead of red shirts, now we have to go back and rewrite that, we have to start the public hearing process over again, square one.” He also indicated he would be willing to share the draft with interested residents before the public hearing stage, telling the local resident who was present who asked to see it in advance, “Absolutely.”
Supervisor Susie Drish noted that Dimmitt’s comments represented his own opinions and that the board has not yet voted on any of the provisions. “Lee is just giving his opinion. We have not voted on it,” Drish said.
On the economic impact of data centers, Dimmitt explained a nuance that may surprise residents — while a large data center could generate millions of dollars in property tax revenue, Jefferson County would not be able to keep those additional funds. Under Senate File 2472, signed into law by Governor Kim Reynolds earlier this year, Iowa counties are now subject to a 2% annual cap on property tax revenue growth. The law, described as the most significant property tax overhaul since the 1970s, limits how much additional revenue a county can collect year over year regardless of how much new taxable property comes online. In practical terms, if a data center were to generate a large new property tax contribution, the county would be required to reduce its levy rate to stay within the 2% growth limit — meaning individual property owners would pay lower taxes, but the county would not gain additional money to spend on roads, services, or other needs.
“If we get that into our coffers, we have to reduce our levy because we’re at a 2% cap,” Dimmitt said, using a hypothetical example of a $10 million property tax contribution from a data center. “You’ll experience a benefit because your property taxes would be significantly reduced just based on that hypothetical number. But there is no benefit to the county coffers as far as building roads and so on and so forth.”
Because of this limitation, Dimmitt said he wants to pursue front-loaded permit fees as a way to capture revenue from data centers that would not be subject to the 2% cap. “I’m wanting that money all up front in a permit process because that does not count against the 2% cap,” he said. “Trying to think a little bit outside the box.”
Dimmitt also noted that Linn County’s Cedar Rapids city council recently voted to place a moratorium on new data centers even as a second facility is under construction there. “I don’t think Jefferson County is on anybody’s radar at the moment,” he said, “but I’m not naive enough to think that it wouldn’t happen in the future.”
The local resident pushed back on that assessment. “I think it is very naive to think that we’re not on anybody’s radar,” she said. “A lot more is being said about what it would be like if we brought one in rather than what we are doing to protect ourselves and how soon.”
The resident also asked about the results of a data center survey that was conducted earlier this year with a June 8th deadline, noting it had still not been tallied four weeks later. Dimmitt said he did not know why the results were taking so long and directed her to contact the city. Supervisor Drish offered an explanation, saying the delay was due to the survey remaining open. “Because it’s an open-ended thing, they’re allowing people to keep coming in and doing it,” Drish said.
