Memphis Delays Data Center Moratorium Vote Amid Protests

Memphis City Council has postponed a vote on a proposed yearlong data center moratorium until Oct. 20.

According to a Fox News report on Wednesday, Council members voted 7-5 on Oct. 6 to defer the decision, prompting protests that interrupted the meeting. Police cleared the chamber, and a fight broke out in the lobby. A police spokesperson said nobody was detained or injured. The cause of the fight was unclear.

The proposal would suspend processing and approval of permits for new data centers and high-density computing facilities within Memphis while officials develop permanent rules. Its definitions cover artificial intelligence processing, cryptocurrency mining and commercial server operations, according to the draft included in the council’s meeting packet.

The debate has implications for a city that hosts Colossus, the South Memphis computing facility used to train Grok and other AI models. Its operator, SpaceXAI, says it has invested billions of dollars locally and contributed tens of millions of dollars in local taxes since arriving in March 2024.

The proposed pause would not require existing, lawfully operating facilities to close. The draft exempts those that do not expand their building footprint, electrical demand, utility capacity or operating intensity. It also protects applications with legally established development rights and routine upgrades that do not materially increase operational impacts.

The moratorium would last up to 12 months, with provisions for earlier termination, including after the city completes required public engagement and implements permanent development standards. The proposed study would examine water consumption, noise, power infrastructure and how to allocate infrastructure costs to developers rather than utility customers.

Councilman J.B. Smiley Jr., a sponsor of the proposal, criticized the handling of the meeting, saying officials should have listened to residents who came to participate. More than 100 people attended.

The moratorium is one of several approaches under consideration. The council’s Oct. 6 executive-session agenda also included separate data center ordinances, a proposed land-use framework and a resolution seeking standards to protect residents, utility customers and public resources.