Council Unanimously Approves Data Center Moratorium

A Microsoft data center in Mount Pleasant, Wisconsin appears in a June 2026 photo. Photo courtesy of Microsoft

The Milwaukee Common Council on Tuesday unanimously approved a one-year moratorium on new data center development, giving city officials time to establish permanent zoning regulations for the rapidly evolving industry.

The moratorium generally prohibits the construction of new data centers or expansion of existing facilities while the city develops regulations addressing their potential impacts on noise, energy consumption, water use and air quality.

But the city isn’t entirely closing the door on new projects. Developers could still pursue site-specific detailed planned development zoning changes, a process that would require public hearings and approvals from the City Plan Commission and Common Council.

The moratorium will expire after one year or upon adoption of permanent regulations, whichever comes first. State law also provides a mechanism for a six month extension.

Ald. Marina Dimitrijevic, the lead sponsor, said the council has been working on the issue for months as the technology and economy are advancing at “lightning speed.”

“We are committed to finding the right regulatory rules,” she said.

Dimitrijevic praised her colleagues, Mayor Cavalier Johnson, and the council’s Legislative Reference Bureau for their work on the proposal. She singled out bureau staff member David Gelting, who she said “made himself an expert on the issue” through hours of research.

The council has been grappling with how to regulate a type of development that can range from relatively small facilities resembling conventional office buildings to sprawling, energy-intensive campuses designed to support artificial intelligence applications.

Ald. Alex Brower, a cosponsor, said it is rare for the council to vote on something “so impactful.”

He praised Dimitrijevic’s leadership and thanked the Party for Socialism and Liberation, Milwaukee Democratic Socialists of America, and other organizations for participating in the debate.

Brower said the council was sending “a message to the tech barons.”

“The revolt against AI is happening,” he declared.

The legislation follows months of discussion, including a contentious City Plan Commission hearing where supporters called for safeguards against potential environmental and neighborhood impacts. Opponents, including the Metropolitan Milwaukee Association of Commerce and Building Advantage, argued that a moratorium could discourage investment, job creation and tax revenue.

Council President José G. Pérez previously urged city planners to consider the potential positive fiscal impacts of data centers alongside their environmental and infrastructure costs.

The Department of City Development is now tasked with developing a permanent regulatory framework.

The push for new regulations emerged just before controversy erupted over a proposal to redevelop the vacant Midtown Center Walmart, 5825 W. Hope Ave., with a mixed-use development that included a 19,000-square-foot data center. After sustained public opposition, the computing component was dropped.

That project was smaller than the 20,000-square-foot threshold contemplated in an earlier regulatory proposal, but the moratorium applies to facilities of any size.

Milwaukee has yet to see a proposal for a data center in its downtown or central business district, though such projects are advancing in Chicago.

One Chicago developer is proposing to convert several floors of a historic Loop office building into a data center, complete with rooftop backup generators. Chicago Mayor Brandon Johnson has also called for a moratorium as his city develops additional regulations.

Meanwhile, massive data center campuses are being developed in southeastern Wisconsin, including projects by Microsoft and Vantage Data Centers on the rural fringes of the Milwaukee metropolitan area.

Milwaukee Planning Manager Tanya Fonseca previously said she does not expect hyperscale facilities of that magnitude to be built in Milwaukee because of the city’s limited available land.

But smaller urban facilities could still be proposed, as Chicago and the Midtown proposal have shown.

Several smaller data centers, which don’t have the heavy energy use associated with AI-focused computing, already operate in the city.

The measure passed on a 13-0 vote, with council members Robert Bauman and JoCasta Zamarripa excused from the meeting. Mayor Johnson is supportive of the moratorium, as previously indicated by DCD representatives and confirmed Tuesday by a spokesperson.

The city last used a zoning moratorium in 2023 on vape and electronic cigarette stores.

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