HomeMy WebLinkAboutOrdinance No. 2026-08 | Gilroy Data Center Urgency Ordinance | Adopted 09/14/2026
ORDINANCE 2026-08
AN URGENCY INTERIM ORDINANCE OF THE CITY
COUNCIL OF THE CITY OF GILROY IMPOSING A
TEMPORARY MORATORIUM ON THE ACCEPTANCE,
PROCESSING, AND APPROVAL OF APPLICATIONS AND
ENTITLEMENTS FOR NEW DATA CENTER FACILITIES
CITYWIDE, FOR A PERIOD NOT TO EXCEED FORTY-
FIVE (45) DAYS
WHEREAS, the City of Gilroy (“City”) is a municipal corporation duly organized as a
Charter City under the California Constitution and laws of the State of California; and
WHEREAS, the City Council has broad discretion pursuant to the California Constitution
Article XI, Section 5, and the general laws of the state, including, but not limited to, the California
Planning and Zoning Law (Gov. Code section 65000 et seq.), to legislate for public purposes and
for the general welfare, including, but not limited to, matters of public health and safety; and
WHEREAS, California Government Code Section 65858 sets forth procedures for the
adoption of an urgency interim ordinance to prohibit the approval of applications for additional
subdivisions, use permits, variances, building permits, and other applicable entitlement s for uses
that may be in conflict with a contemplated specific plan or zoning proposal that the legislative
body, planning commission, or the planning department is considering or studying or intends to
study; and
WHEREAS, California Government Code Section 65858, subdivision (c), provides that
the City Council shall not adopt or extend an interim ordinance under that section unless the
ordinance contains legislative findings that there is a current and immediate threat to t he public
health, safety, or welfare, and that the approval of additional subdivisions, use permits, variances,
building permits, or any other applicable entitlement for use which is required in order to comply
with a zoning ordinance would result in that threat to the public health, safety, or welfare; and
WHEREAS, for purposes of this Ordinance, “Data Center” means a facility, or any
discrete portion of a facility, that is designed, constructed, or used as a stand-alone or primary use
to house computer systems, servers, data storage equipment, and associated networking, cooling,
electrical, and backup power infrastructure, for the storage, processing, manag ement, or
distribution of data on behalf of one or more third parties or business units, including facilities
supporting cloud computing, colocation, and artificial intelligence applications, and that either (i)
occupies 15,000 square feet or more of gross floor area, or (ii) has, or is designed to have, a
dedicated critical information technology electrical load of one (1) megawatt or more. “Data
Center” does not include a room, closet, or other space within a building that is accessory and
incidental to the primary permitted use of that building and is used solely to support the on-site
business, communications, or information technology operations of the occupant of that building;
and
WHEREAS, the Gilroy City Code does not currently define “Data Center” as a distinct
land use classification and does not contain zoning, development, or operational standards specific
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Ordinance No. 2026-08
Data Center Urgency Interim Ordinance
City Council Regular Meeting | September 14, 2026
Page 2 of 8
to Data Centers, including without limitation standards addressing electrical grid capacity and
demand, water consumption and cooling technology, backup generator emissions and noise,
aesthetics and screening, truck traffic, and decommissioning; as a result, Data Center uses may
currently be processed under Gilroy City Code Chapter 30 (Zoning), Article L (Planning
Department Applications), as a use subject only to administrative Architectural and Site Review
approval by the Community Development Director or designee — without any public hearing
before the Planning Commission or City Council — within the M2 (General Industrial) zoning
district, where, pursuant to Table 30.23.10C(c) of the Gilroy City Code, Data Center uses are
permitted only under the generic “Data Processing Establishments” use classification, which is not
tailored to, and does not contain any development or operational standards specific to, the unique
scale and intensity of Data Center impacts; and although the City Council introduced an ordinance
amending this same Article L Architectural and Site Review process, to enhance public outreach,
on first reading at the August 17, 2026 meeting, and is scheduled to adopt that ordinance on second
reading at the same September 14, 2026 meeting at which this Ordinance is presented, that
ordinance will not yet have taken effect as of the date of this Ordinance, and in any event does not
add any public hearing before the Planning Commission or City Council, or any Data Center -
specific development or operational standard, to the Architectural and Site Review process; and
WHEREAS, the City is home to an existing Data Center facility operated by Amazon Web
Services, Inc. (“AWS”), known as the AWS Data Center, located at 8050 Camino Arroyo (APN
841-69-044), for which the Final Environmental Impact Report (State Clearinghouse No.
2022110127) was certified with a Statement of Overriding Considerations pursuant to California
Environmental Quality Act (CEQA) Guidelines Section 15090 and the project approved by the
Community Development Director on behalf of the City on July 3, 2025 pursuant to Site and
Architectural Review Permit No. AS 20-23 (the “Existing AWS Facility”); and
WHEREAS, notwithstanding the conditions of approval placed on the project by City staff
and the mitigation measures adopted in connection with the Existing AWS Facility, the certified
Final Environmental Impact Report found that the project would result in two sign ificant and
unavoidable environmental impacts even after mitigation — (i) conversion of Prime Farmland and
Farmland of Statewide Importance to non-agricultural use (Impact AG-1), and (ii) vehicle miles
traveled in excess of the threshold of significance under CEQA Guidelines Section 15064.3
(Impact TRA-1); and that the Existing AWS Facility further involves up to 49 megawatts of
electrical demand per data center building — up to 98 megawatts combined at full two-building
build-out — backed by twenty-five 2.5-megawatt and one 600-kilowatt diesel backup generators
for the first building alone, and water demand of up to approximately 7.49 million gallons (23
acre-feet) per year at full build-out, demonstrating that Data Center land uses within the City result
in substantial, irreversible impacts to agricultural resources and the regional transportation
network, and significant demand on electrical grid capacity, backup generator emissions and noise,
and water supply and cooling infrastructure, which the City’s current regulations do not adequately
address; and
WHEREAS, the City has received a pre-application from AWS for a second, expanded
Data Center facility within the City (the “Proposed AWS Project”), anticipated to be located at or
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Ordinance No. 2026-08
Data Center Urgency Interim Ordinance
City Council Regular Meeting | September 14, 2026
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near the intersection of Highway 152 and Camino Arroyo and although the City has not yet
received or begun processing a formal application for the Proposed AWS Project, City staff
reasonably anticipate, based on the pre-application and related communications, that a formal
application will be submitted within a reasonable time, and that additional Data Center applications
from other operators may also be submitted in light of increasing regional and statewide demand
for Data Center facilities; and
WHEREAS, because the Existing AWS Facility is directly comparable in use, scale, and
location to the Proposed AWS Project and to other new or expanded Data Center facilities
reasonably anticipated to be proposed within the City, the significant and unavoidable
environmental impacts, Statement of Overriding Considerations, and infrastructure demands
documented in the certified Final Environmental Impact Report for the Existing AWS Facility
provide direct, City-specific, and substantial evidence that approval of additional applications and
entitlements for new or expanded Data Center facilities under the City’s current regulations would
result in similar significant and unavoidable impacts to agricultural resources and the
transportation network, and similar substantial demands on electrical grid capacity, water supply,
and cooling infrastructure; and
WHEREAS, on August 17, 2026, the City Council held a duly noticed public hearing on
the Introduction and First Reading of an ordinance amending Chapter 30 (Zoning), Article L
(Planning Department Applications) of the Gilroy City Code relating to the Architectural and Site
Review permit process and to enhance public outreach (Agenda Item 8.1), at which the City
Council received extensive public testimony, including numerous comments both in favor of and
in opposition to the Existing AWS Facility; and
WHEREAS, at that same August 17, 2026 meeting, in connection with Agenda Item 8.1,
the City Council provided direction to City staff to bring back objective design standards for
commercial and industrial projects that consider community needs, economic development, energy
use, environmental impacts, public health, and neighborhood quality of life (the “Objective Design
Standards Direction”), reflecting the City Council's own determination that the City's current
commercial and industrial development standards do not adequately address these considerations;
and
WHEREAS, consistent with, and in furtherance of, the Objective Design Standards
Direction, the City Council desires, and hereby directs the Community Development Department
and Planning Commission, to study and prepare recommended amendments to the Gilroy City
Code that would (i) define “Data Center” as a distinct land use and establish appropriate zoning,
siting, development, and operational standards therefor, including without limitation standards
addressing electrical grid capacity and demand, water consumption and cooling technology, noise
and emissions from backup generators, aesthetics and screening, truck traffic, and
decommissioning, and (ii) implement the Objective Design Standards Direction for commercial
and industrial projects, including Data Centers, addressing community needs, economic
development, energy use, environmental impacts, public health, and neighborhood quality of life
(collectively, the “Contemplated Zoning Proposal”); and
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Ordinance No. 2026-08
Data Center Urgency Interim Ordinance
City Council Regular Meeting | September 14, 2026
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WHEREAS, absent a temporary moratorium, the City may be required to accept, process,
and approve applications and entitlements for new or expanded Data Center facilities, including
the anticipated formal application for the Proposed AWS Project, under the City’s current
regulations before the City has had the opportunity to study and adopt the Contemplated Zoning
Proposal; and
WHEREAS, the City Council finds, based on the evidence in the record — including but
not limited to the documented impacts of the Existing AWS Facility described above, the pre -
application for the Proposed AWS Project, the extensive public testimony received at the August
17, 2026 public hearing on Agenda Item 8.1, and the staff report accompanying this Ordinance —
that there is a current and immediate threat to the public health, safety, and welfare of the City and
its residents arising from the acceptance, processing, and approval of applications and entitlements
for new or expanded Data Center facilities under the City’s current regulations; and
WHEREAS, the City Council further finds that the approval of applications and
entitlements for new or expanded Data Center facilities under the City’s current regulations —
which, as reflected in the Objective Design Standards Direction, lack objective, enforceable
development standards tailored to Data Center impacts — would result in, and exacerbate, that
threat to the public health, safety, and welfare, in that such approval would result in significant and
unavoidable impacts to Prime Farmland and Farmland of Statewide Importance and to the regional
transportation network of the kind documented in the certified Final Environmental Impact Report
for the Existing AWS Facility, further significant strain on the City’s electrical grid and water
supply infrastructure beyond levels the City’s utility providers can currently support without
significant capital improvements, increased ambient noise and light affecting nearby sensitive land
uses, increased heavy-truck traffic on City streets not designed to accommodate such use, and a
resulting alteration, in a substantial and fundamental manner, of the character and quality of life
of the affected neighborhoods and the City as a whole; and
WHEREAS, within a reasonable time, the City Council, Planning Commission, and/or
Community Development Department is considering, studying, or intends to study, the
Contemplated Zoning Proposal to address the foregoing concerns, with which new or expanded
Data Center uses may be in conflict; and
WHEREAS, on September 14, 2026, in accordance with State law, the City Council
provided due consideration of all evidence presented and provided in the entire administrative
record and held a duly noticed public hearing and took testimony regarding this urgency int erim
Ordinance.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF GILROY DOES
HEREBY ORDAIN AS FOLLOWS:
SECTION I. Recitals.
The above recitals are true and correct and hereby adopted as the City Council’s findings.
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Ordinance No. 2026-08
Data Center Urgency Interim Ordinance
City Council Regular Meeting | September 14, 2026
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SECTION II. Purpose and Authority.
In the interest of protecting the health, safety, and welfare of the residents of the City of Gilroy, it
is the purpose and intent of this urgency interim Ordinance to place a temporary moratorium on
the acceptance, processing, and approval of any new application, permit, license, or other
entitlement for the establishment of a new Data Center facility, citywide. The City Council has
authority to adopt this Ordinance pursuant to California Government Code Section 65858 as an
urgency measure prohibiting any use that may be in conflict with the Contemplated Zoning
Proposal that the City is considering or studying.
SECTION III. Findings.
The City Council hereby finds and determines that the acceptance, processing, and approval of
applications and entitlements for new Data Center land uses in the City, under the City’s current
regulations, constitutes a current and immediate threat to the public health, safety, and welfare.
The approval of additional entitlements for Data Center land uses, including but not limited to the
anticipated formal application for the Proposed AWS Project, under the City’s current regulations
would result in and exacerbate that threat to the public health, safety, and welfare. The adoption
of this urgency interim Ordinance is therefore necessary for the immediate protection of the public
health, safety, and welfare. The above recitals are incorporated herein by refer ence as true and
correct as the Council’s findings.
SECTION IV. Definitions.
For purposes of this Ordinance, “Data Center” means a facility, or any discrete portion of a facility,
that is designed, constructed, or used as a stand-alone or primary use to house computer systems,
servers, data storage equipment, and associated networking, cooling, electrical, and backup power
infrastructure, for the storage, processing, management, or distribution of data on behalf of one or
more third parties or business units, including facilities supporting cloud computing, colocation,
and artificial intelligence applications, and that either (i) occupies 15,000 square feet or more of
gross floor area, or (ii) has, or is designed to have, a dedicated critical information technology
electrical load of one (1) megawatt or more. “Data Center” does not include a room, closet, or
other space within a building that is accessory and incidental to the primary permitted use of that
building and is used solely to support the on-site business, communications, or information
technology operations of the occupant of that building.
For purposes of this Ordinance, the “establishment of a new Data Center facility” means the
construction, occupancy, or operation of a Data Center pursuant to an application, permit, license,
or other entitlement that is not, as of the effective date of this Ordinance, an approved and effective
entitlement. The “establishment of a new Data Center facility” does not include the continued
construction, occupancy, operation, maintenance, or repair of a Data Center pursuant to an
entitlement approved and in effect prior to the effective date of this Ordinance, including the
Existing AWS Facility, which is approved in its entirety pursuant to Architectural and Site Review
Permit No. AS 20-23, regardless of whether construction of any phase of the Existing AWS
Facility remains ongoing or is completed after the effective date of this Ordinance.
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Ordinance No. 2026-08
Data Center Urgency Interim Ordinance
City Council Regular Meeting | September 14, 2026
Page 6 of 8
SECTION V. Moratorium Imposed.
This Ordinance imposes a moratorium on the acceptance, processing, and approval of any
application, permit, license, entitlement, or other approval — whether ministerial or discretionary
— for the establishment of a new Data Center facility, anywhere within the City.
SECTION VI. Violation.
Except as otherwise permitted under this urgency interim Ordinance, the establishment of a new
Data Center facility in violation of this Ordinance is declared to be a public nuisance. Violations
of this urgency interim Ordinance may be enforced by any applicable laws or ordinances,
including, but not limited to, injunctions or administrative or criminal penalties under the Gilroy
City Code.
SECTION VII. Report.
Pursuant to California Government Code Section 65858, subdivision (d), the City Administrator,
or designee, is authorized and directed to prepare a written report describing the measures taken
to alleviate the conditions which led to the adoption of this urgency interim Ordinance, for
presentation to the City Council no later than ten (10) days prior to the expiration of this Ordinance
or any extension thereof.
SECTION VIII. Term of Ordinance.
This urgency interim Ordinance shall be in effect from the date of adoption for a period of forty -
five (45) days, unless it is extended pursuant to California Government Code Section 65858 or
other applicable law, as approved by the City Council.
SECTION IX. Severability.
If any section, subsection, subdivision, sentence, clause or phrase of this urgency interim
Ordinance is for any reason held to be unconstitutional or otherwise void or invalid by any court
of competent jurisdiction, such decision shall not affect the validity of the remaining portions of
this urgency interim Ordinance. The City Council hereby declares that it would have passed this
urgency interim Ordinance and each section, subsection, subdivision, sentence, clause or phrase
thereof, irrespective of the fact that any one or more sections, subsections, subdivisions, sentences,
clauses, or phrases may be declared unconstitutional or otherwise invalid by a court of competent
jurisdiction.
SECTION X. CEQA Determination.
This urgency interim Ordinance is exempt from environmental analysis under the California
Environmental Quality Act (CEQA) in accordance with CEQA Guidelines Section 15061(b)(3)
because it can be seen with certainty that this Ordinance has no possibility of having a significant
effect on the environment, as it merely preserves the status quo in accordance with Government
Code Section 65858 in the interest of evaluating and preventing potential harms related to Data
Center land uses. This Ordinance does not authorize any development, approve any land-use
entitlement, or result in any physical change to the environment.
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Ordinance No. 2026-08
Data Center Urgency Interim Ordinance
City Council Regular Meeting | September 14, 2026
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SECTION XI. Effective Date.
This urgency interim Ordinance, passed by at least a four -fifths vote of the City Council, is
declared to be an urgency interim Ordinance for preserving the public health, safety, and welfare
and shall take effect and be enforced immediately upon adoption pursuant to Government Code
Section 36937(b).
SECTION XII. Publication.
The City Clerk shall cause this Ordinance, or summary thereof, to be published one time within
fifteen (15) days upon passage and adoption in a newspaper of general circulation, such as the
Gilroy Dispatch.
PASSED AND ADOPTED by the City Council of the City of Gilroy at a regular meeting duly
held on the 14th day of September 2026 by the following roll call vote:
AYES: COUNCIL MEMBERS: BRACCO, CLINE, HILTON, FUGAZZI
MARQUES, RAMIREZ, BOZZO
NOES: COUNCIL MEMBERS: NONE
ABSTAIN: COUNCIL MEMBERS: NONE
ABSENT: COUNCIL MEMBERS: NONE
APPROVED:
___________________
Greg Bozzo, Mayor
ATTEST:
_______________________
Kim Mancera, City Clerk
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Ordinance No. 2026-08
Data Center Urgency Interim Ordinance
City Council Regular Meeting | September 14, 2026
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CERTIFICATE OF THE CLERK
I, KIM MANCERA, City Clerk of the City of Gilroy, do hereby certify that the
attached Ordinance No. 2026-08 is an original ordinance, or true and correct copy of a City
Ordinance, duly adopted by the Council of the City of Gilroy at a Regular Meeting of
said Council held on Monday, September 14, 2026, with a quorum present.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of
the City of Gilroy this Tuesday, September 15, 2026.
____________________________________
Kim Mancera
City Clerk of the City of Gilroy
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