Minnesota Lawmakers Addressed Data Center Regulation
State officials discussed new industry rules during a virtual town hall for Rochester-area residents.
Updated on Sept. 25, 2026 in Data Centers
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Minnesota legislators held a virtual town hall to gauge public sentiment on data center expansion and regulation. The discussion follows state-level policy shifts and localized efforts to establish stricter municipal oversight for new facility developments.
Why it matters
Lawmakers are working to define regulatory boundaries for data centers amid growing public concern regarding environmental impacts and data privacy. These sessions aim to reconcile industry growth with resident expectations before new projects proceed.
Minnesota recently eliminated a $140 million state sales tax exemption on electricity for data centers. Additionally, facilities utilizing over 100 million gallons of water must now coordinate directly with the Minnesota Department of Natural Resources.
The players
Minnesota Department of Natural Resources
This state agency manages the environmental oversight and water usage coordination for large-scale industrial projects.
Harmony Planning and Zoning Commission
This local municipal body oversees land use regulations and is currently drafting ordinances to govern data center developments.
The details
Municipalities are drafting local ordinances to increase transparency, including a proposal in Harmony that would ban the use of non-disclosure agreements in project negotiations. Meanwhile, data center projects in locations like Pine Island remain stalled due to ongoing litigation.
Timeline
September 24, 2026: Lawmakers hosted a virtual town hall for Rochester-area residents.
October 14, 2026: The Harmony planning and zoning commission will review a draft data center ordinance.
The Tech Race
The elimination of the $140 million tax exemption marks a departure from previous incentives meant to attract infrastructure, signaling a move toward stricter oversight. This trend reflects a broader national shift where states are increasingly balancing industry growth against local environmental and utility concerns.
Residents may see changes in how local land is developed as municipalities move toward stricter non-disclosure rules. These policies are designed to grant the public more insight into project negotiations that could affect local water resources and utility rates.
The takeaway
The increased scrutiny on data centers reflects a push for greater transparency in industrial infrastructure planning. Residents should stay informed on local zoning board agendas to participate in the shaping of these community-level regulations.
What happens next
The Harmony planning and zoning commission is scheduled to review its proposed data center ordinance on October 14, 2026, which may influence future local development standards.
Further reading
Learn more about the evolving infrastructure landscape in Minnesota Data Centers.
Source note: This article includes information reported by KTTC.
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Should local communities have more authority to block data center projects in their area?
