As Kentucky chases data centers, a Lexington draft would tell hyperscalers no.

Lexington, Kentucky's Planning Commission is reviewing a draft Zoning Ordinance Text Amendment (ZOTA) that would significantly restrict data center development in Fayette County. Prepared by Caleb Rosico of Tannel Spangler Walsh & Associates, the proposal seeks to impose a 50,000-square-foot cap on data centers, effectively prohibiting hyperscale operations countywide. This initiative aims to address a current gap in Lexington's zoning code, which currently lacks a specific definition or regulation for data centers. The proposed ZOTA, which will rewrite the city’s B-4, I-1, and I-2 industrial districts, defines two categories: "minor-data-centers" (under 50,000 sq ft, requiring conditional use review and specific submissions) and a prohibition on anything larger. Rosico highlighted concerns over noise, proposing a quarter-mile separation and landscape buffers from residential areas. Planning Commissioner Frank Penn questioned the necessity of even discussing large data centers in Lexington, while Principal Planner Hal Baillie emphasized the need to modernize zoning to address increasing inquiries about data centers as a primary land use. The timing is particularly notable as Kentucky's General Assembly recently passed House Bill 775, expanding sales and use tax exemptions to attract data centers, with Fayette County eligible for projects committing at least $450 million. The ZOTA's intent is to send a "not here, not at that scale" message, despite state-level efforts to lure such facilities. The article also touches on potential impacts on Lexington’s drinking water supply, with Commissioner Molly Davis raising concerns about cooling water and the Royal Springs Aquifer. Eve Miller, senior planner, acknowledged that while there are recommendations for groundwater protection, codified rules are currently lacking, making the ZOTA's water consumption plan requirement a first. The ZOTA's formal filing is planned for June, with an Urban County Council vote anticipated in late summer or early fall.