October 20, 2026
Community Development
DATE: October 20, 2026
TO: Mayor Martinez and Members of the City Council
FROM: Lina Velasco, Director of Community Development
Avery Stark, Planning Manager
SUBJECT: Extension of Moratorium on Data Centers
FINANCIAL IMPACT: The urgency ordinance extension, if adopted, would be enforced pursuant to routine code enforcement efforts,
impact the approval and issuance of permits and land
use entitlement related to data center. Since no
application is pending the impacts on the General Fund is unknown.
PREVIOUS COUNCIL
ACTION:
September 15, 2026
STATEMENT OF THE
ISSUE:
On September 15, 2026, the City Council adopted
Urgency Ordinance No. 13-26 N.S., which placed a
temporary 45-day moratorium on the issuance or
approval of permits or land use entitlements for data
centers within the City of Richmond and declared an
urgency thereof pursuant to Government Code Section
65858. City staff recommend that the urgency ordinance
be extended pursuant to Government Code Section
65858(b) for an additional 22 months and 15 days, until September 15, 2028, to provide staff with sufficient time to study and engage the public in the establishment of
reasonable regulations of data centers to protect the
public health, welfare, and safety.
AGENDA
REPORT
October 20, 2026
RECOMMENDED ACTION: ADOPT an urgency ordinance, pursuant to Government Code Section 65858, extending the temporary
moratorium on the issuance of any new permit or land
use approval for any data center in the City of Richmond for an additional 22 months and 15 days, until September 15, 2028, which is intended to preserve the status quo
and will not cause a direct physical change in the
environment, nor a reasonably foreseeable indirect
physical change in the environment, and therefore does
not constitute the approval of a project under the
California Environmental Quality Act (“CEQA”) and is
exempt from CEQA (Pub. Res. Code § 21065, CEQA
Guidelines §§ 15060(c)(2)(3); 15061(b)(3); 15064(d)(3); 15378(a)) - Community Development Department (Lina
Velasco/Avery Stark 510-620-6714).
DISCUSSION:
On September 15, 2026, the City Council adopted Urgency Ordinance No. 13-26 N.S., which placed a temporary 45-day moratorium on any new data center in the City of Richmond and declared the urgency of that action under Government Code Section 65858.
The City Council adopted that ordinance following notice and a public hearing and by a four-fifths vote, under its police power, which is confirmed by Article XI, section 7 of the California Constitution and by Article II, section 1, and Article IX, section 10 of the Richmond City Charter. City staff now recommend that the City Council adopt a single ordinance that amends, restates, and supersedes Ordinance No. 13-26 N.S. and extends the moratorium under Government Code Section 65858 for 22 months and 15 days, through September 15, 2028. That period is the longest single extension the statute allows for an interim ordinance adopted after notice and a public hearing, and it keeps the moratorium within the statute's two-year limit. The extension will give staff enough time to study data centers and to engage the public in setting reasonable regulations for them, if the City allows them, to protect the public health, safety, and welfare.
ANALYSIS/DISCUSSION:
As noted and presented on September 15, 2026, data centers are emerging as a more prominent land use in cities nationwide, driven by increasing demand for digital infrastructure to support cloud computing, artificial intelligence, and data storage. While these facilities can generate economic benefits, including construction activity, limited employment opportunities, and potential tax revenue, they also present unique land use considerations. Unlike traditional commercial or industrial uses, data centers operate with high infrastructure demands and relatively low on-site employment, raising questions about their long-term value relative to other potential land uses.
A primary concern associated with data center development is the significant demand for electricity, water, and land resources. Data centers require substantial and continuous
October 20, 2026
power supply to operate servers and cooling systems, which may strain existing energy infrastructure and conflict with local and regional climate goals. Water usage for cooling, particularly in areas facing drought conditions, further complicates sustainability considerations. Additionally, these facilities often require large building footprints, which can limit opportunities for more community-serving or employment-generating uses.
Beyond resource consumption, data centers may also create compatibility challenges with surrounding land uses. Potential impacts include noise from mechanical equipment, visual scale and design concerns, and limited activation of the public realm. These factors can affect nearby residential neighborhoods, reduce property values, and conflict with broader community priorities for equitable development, economic vitality, and environmental stewardship. Careful planning and policy guidance are therefore needed to keep any future data center development consistent with the City's goals and standards.
Given the evolving nature of this industry and the uncertainty in balancing its potential benefits with long-term costs, a temporary moratorium is desired by the City Council to engage in a public planning process to evaluate whether and under what regulations data centers may be permitted. A temporary moratorium would provide the City with time to conduct a comprehensive evaluation of impacts, review best practices from other jurisdictions, and engage stakeholders, including residents, utility providers, and industry representatives. This process would enable the City to evaluate the desirability of the land use and if desired, develop clear policies and regulations to guide future data center proposals in a manner that aligns with community priorities and resource constraints.
Regional activity confirms that the threat is current and immediate, not speculative. As of September 17, 2026, three nearby cities have approved major data center projects:
Pittsburg approved a project involving the AVAIO-affiliated Pittsburg Data Hub, LLC and AVAIO Digital; Hayward approved a project involving STACK Infrastructure; and Gilroy approved a project involving Amazon Data Services. Bay Area cities are also using land use controls to respond. As of the same date, Oakley, Gilroy, and Richmond have adopted temporary citywide moratoria on new data center development; San Francisco and Oakland have moratorium proposals pending (both cities have since adopted their moratoriums); and Hayward has adopted enhanced review requirements for future projects rather than a moratorium. City staff have not identified any permanent citywide data center prohibition adopted by a Bay Area municipality. These approvals show that data center operators are actively securing sites in comparable Bay Area cities and could seek approval in Richmond during the City's study, while the range of local responses shows that a temporary moratorium is a measured, mainstream approach rather than a permanent ban.
City staff recommend that the City Council adopt a single urgency ordinance that amends, restates, and supersedes Ordinance No. 13-26 N.S. and extends the temporary moratorium for 22 months and 15 days, through September 15, 2028. Consolidating the original ordinance and its extension into one instrument gives the public and future readers a single, clear statement of the moratorium and its findings. The extension will give staff enough time to prepare amendments to the Richmond Municipal Code and to study and
October 20, 2026
develop stronger regulations of data centers that adequately protect the public health, safety, and welfare. City staff prepared and posted online the 10-day report that Government Code section 65858 requires at www.richmondca.gov/datacenterstudy. That report describes the measures the City has taken to alleviate the conditions that led to the adoption of the urgency ordinance.
ENVIRONMENTAL ANALYSIS:
This ordinance is exempt from the California Environmental Quality Act ("CEQA") on two independent grounds. First, it is not a "project." The ordinance continues a temporary moratorium and preserves the status quo; it authorizes no development and will not cause a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment. (Pub. Resources Code § 21065; Cal. Code Regs., tit. 14, §§ 15060(c)(2)-(3), 15378.) Second, even if it were a project, it is exempt under the common sense exemption. Based on the whole record—including this staff report, the 10-day report, and the studies and jurisdictional research the City has reviewed—it can be seen with certainty that there is no possibility that the ordinance may have a significant effect on the environment, because a moratorium that prohibits new data centers prevents, rather than causes, physical change. (Cal. Code Regs., tit. 14 § 15061(b)(3).) Staff will file a notice of exemption with the County Clerk. (Cal. Code Regs., tit. 14 § 15062.) ALTERNATIVE ACTIONS:
The City Council could decide not to extend the moratorium at this time and instead direct staff to continue work on possible amendments to City codes while processing new applications. This could cause immediate adverse impacts. For example, data center developers that other cities have blocked could relocate to Richmond during the period the City needs to develop and propose stronger regulations.
DOCUMENTS ATTACHED:
Attachment 1 – Urgency Ordinance Amending, Restating, and Extending the Data Center Moratorium (supersedes Ordinance No. 13-26 N.S.)
Attachment 2 – Urgency Ordinance No. 13-26 N.S. (superseded) Attachment 3 – 10-Day Report