Editor's Note: This story has been updated to include language used by the county in the withdrawn signature for the data center. One attributed quote has been corrected as well.

Martin Kidston

(Missoula Current) The property owner behind a proposed data center in Bonner has withdrawn his signature from a special exception application, though Missoula County will move forward with an interim ban on new facilities until it can develop a policy guiding future endeavors.

The special exception application is required for the project to move forward, one county official said.

County officials on Monday morning confirmed that the property owner had withdrawn his signature on the application, which included the Krambu data center. The application sought to open the data center at the Bonner development yard, though the process had become protracted and faced growing public opposition.

“I was surprised they decided to withdraw their application,” said county planner Jennie Dixon. “I was encouraging them to stay the course because, wouldn't it be fantastic if Missoula could be the poster child for how to do a data center the right way? That's our goal with this interim pause, to figure out how to be the example for the country on how to do these the right way.”

The county last month announced its intention to enact interim zoning to pause any future data center development until it could study their impacts and any potential regulations needed to mitigate them.

The potential zoning comes as the debate around data centers and their intense energy use intensifies. Under current county zoning, data centers and crypto-currency operations must develop or purchase enough new renewable energy to offset their electrical consumption.

Current policy also requires them to dispose of any e-waste at a recycling center licensed by the Montana Department of Environmental Quality.

But that policy was adopted in 2020 before the Legislature said that cryptocurrency mining and data centers must be treated equally. Since then, the county has learned that there's more to data centers than meets the eye.

“This is a relatively new use and our current regulations don't adequately address the potential impacts,” said Karen Hughes, director of county planning and development. “We do have regulations that apply and address the energy issue and e-waste issues. But it does less with water quality and quantity impacts, air quality, noise, heat, vibration and other impacts to public health, safety and the environment.”

The county cited a public emergency in 2019 when it placed interim regulations on new or expanded cryptocurrency operations. It expanded those temporary regulations again in 2020 before adopting permanent zoning in 2021.

The proposed ban will follow a similar course with a public hearing set for July 9 and a resolution identifying the nature of the “emergency,” along with any proposed zoning boundaries and regulations. If adopted, the county has 30 working days to initiate a study.

Data centers have become a statewide issue in recent months. In Yellowstone and Butte-Silver Bow counties, groups are gathering signatures for initiatives that would require approval from two-thirds of registered voters before construction or expansion of data centers, according to the Daily Montanan.

Commissioner Josh Slotnick attended a meeting with the National Association of Counties earlier this year where data centers were a point of conversation, he said.

“This was the biggest topic,” Slotnick said. “The data centers of 2023 aren't the data centers of 2026.”

Hughes said public comment and concern brought many issues to light. In part, they aided the county in realizing that its current policies on data centers and crypto mining weren't adequate.

“The public really brought forward those issues and had a lot to say about them,” said Hughes. “We want to be making public policy that's in line with public interest.”