State Senator sees likely dispute to data center ban
A Texas state senator anticipates a legal challenge to San Marcos' city-wide data center ban, citing House Bill 2559 which limits local moratoriums on property development. The city, which became the first in Texas to ban data centers through changes to its Land Development Code, maintains its action is lawful. Separately, the Governor has mandated audits for all data center projects seeking grid connection.
Texas State Senator Paul Bettencourt (R-Houston) expects a legal challenge to San Marcos' city-wide data center ban, citing potential non-compliance with House Bill 2559. HB 2559 limits local governments from enacting indefinite pauses or moratoriums on property developments. San Marcos became the first city in Texas to ban data centers by a 4-3 council vote on June 16, changing its Land Development Code after months of public hearings and community input.
While Hood County rejected a similar data center moratorium after Bettencourt sent a letter referencing HB 2559, San Marcos Councilmember Amanda Rodriguez maintains the city's ban, enacted via its home-rule authority to amend zoning, does not violate the state law. The ban remains in effect, and the city has not received formal admonition from the state. Opposition from groups like the Data Center Action Coalition (DCAC) helped halt two data center developments and secure the ban.
In a related development, Hill County faced a lawsuit from developer RCM Hill LLC after passing a one-year pause on data center development, with the developer also citing HB 2559. Furthermore, Governor Greg Abbott announced on August 3 that the Public Utility Commission of Texas (PUCT) and the Electric Reliability Council of Texas (ERCOT) will conduct mandatory audits of all data center projects before they can connect to the state's electricity grid.