Eugene bans confidentiality agreements for data centers

Eugene, Oregon has formally prohibited city employees from entering into nondisclosure agreements (NDAs) with data center developers, a decision prompted by increasing public scrutiny and demands for greater transparency regarding data center projects. City Manager Jenny Haruyama issued an order on September 16, explicitly directing all city staff not to sign NDAs related to data centers, a move welcomed by community members who have voiced concerns over environmental and public health impacts.

This policy change follows a recent city ruling that deemed a data center an unaccepted use for the 1.2 million-square-foot former Hynix factory in west Eugene under existing zoning regulations. Despite this, over 70 residents urged the Eugene City Council to implement a moratorium on new data center construction and solidify the NDA ban. While NDAs are a common practice in development, they have faced nationwide criticism for concealing negotiations. The Salem City Council, for instance, is also exploring policies on NDAs after its own experience with a Verrus data center project.

Eugene city councilors, including President Lyndsie Leech, Councilor Jennifer Yeh, and Mayor Kaarin Knudson, have publicly committed to not signing NDAs. However, the new order ensures this policy applies across all city employees. The council is also planning a work session for December 14 to clarify ambiguous sections of the city code regarding data centers, with councilors like Eliza Kashinsky advocating for more explicit prohibitions on hyperscale data centers within city limits, which Mayor Knudson stated are not currently a permitted use.