Ponderay City Council explored the possibility of banning data centers from the city during an August 3 meeting, prompted by growing concern over the resource demands and limited economic benefits of large-scale facilities.
The discussion followed Sandpoint City Council’s unanimous approval last month of a motion to prohibit larger-scale AI data centers within city limits. Councilor Rick Larkin brought the issue to Ponderay’s attention, arguing that data centers present significant challenges to local infrastructure and quality of life.
Infrastructure and Resource Concerns
Larkin identified power consumption as a primary problem, noting that data centers use as much electricity as thousands of homes combined. He also raised concerns about water consumption, noise, light pollution, rising power costs for residents, and potential cybersecurity risks. Most significantly, Larkin pointed out that data centers generate few permanent jobs—he estimated between 20 and 50 permanent staff positions at such facilities.
“It’s becoming a major issue throughout the United States,” Larkin told the council, according to reporting by the Bonner County Daily Bee.
Councilor Brenda Thompson voiced support for exploring a ban on data centers within city boundaries.
Council Divided on Regulatory Approach
Council President Phil McNearney opposed an outright ban, instead favoring a regulatory approach. He noted that data centers would already be subject to power and water recirculation mandates that could limit their viability in the area.
“It’s not something we’ve dealt with before,” McNearney said, according to the reporting.
Planning Director KayLeigh Miller offered a more measured assessment of the threat. She suggested that a data center installation would be largely self-limiting given the current condition of the city’s water system. Under existing city ordinance, Miller explained, a data center would operate similarly to a warehouse or wholesale facility. She also noted that limited commercial zone parcels in Ponderay are large enough to accommodate a data center project.
McNearney expressed uncertainty about whether the city even has sufficient sites suitable for such a facility.
Community Concerns Prompt Action
Part of the council’s focus stems from community attention to a possible expansion of Avista Corporation’s facilities in the area. Larkin referenced social media discussions in which residents expressed concern that an Avista expansion might be intended for data center operations. Larkin’s proposal sought to preempt such a development before it could take root in Ponderay.
Miller proposed a code amendment that would explicitly exclude data centers from the zoning code’s permitted use areas. Such an amendment would provide clearer legal protection against future data center proposals than relying on infrastructure limitations alone.
The council did not take a final vote on banning data centers during the August 3 meeting. Members indicated they plan to continue the discussion at a future session, allowing time for further review and public input.
The debate reflects broader concerns across North Idaho communities about balancing economic development with protection of local resources and character. Sandpoint Council’s earlier action to revisit city policies suggests a regional trend toward more cautious approaches to large industrial or technology facilities that could strain local utilities.