Salem, Oregon – At a packed council meeting in July, residents voiced strong concerns over a proposed artificial‑intelligence data center operated by Verrus, a California‑based tech firm. The community’s unease centered on a nondisclosure agreement (NDA) signed between the city manager and Verrus in March 2025, which many described as a breach of public trust.
Residents demand transparency
Council member Vanessa Nordyke admitted she only learned of the NDA this month, prompting questions about why the agreement had been kept secret. Opponents warned that the data center could generate constant humming noises, affect the health of humans and animals, and drive up electricity rates for local households.
Council action
On September 14, the Salem City Council voted to ban NDAs for any future data‑center projects and to impose a four‑month moratorium on the Verrus development. The pause means Verrus cannot break ground until the city completes a thorough review of the site’s feasibility, utility capacity, and environmental impact.
Why NDAs are controversial
Data‑center advocates argue that NDAs protect proprietary technology and encourage companies to share detailed plans with municipalities. Jon Hukill, vice president of communications for the Data Center Coalition, said without confidentiality, firms might hesitate to disclose critical design information.
Critics, however, contend that NDAs can be used to silence local officials and keep residents out of the decision‑making process. University of Mary Washington sociology associate professor Eric Bonds noted that NDAs may “improperly and even illegally prevent disclosure of information mandated by Freedom of Information Act and open‑records laws.”
National context
Similar secrecy agreements have been reported in Louisiana, where Meta and the state’s largest energy company used NDAs to fast‑track approval of a massive AI data center. In Virginia, a recent study found that 25 of 31 contacted localities had NDAs with data‑center developers.
In contrast, Pennsylvania Governor Josh Shapiro signed an executive order in August banning NDAs for data‑center projects, and several states—including Texas, New York, and Florida—have adopted year‑long moratoriums to evaluate the impact of these facilities on local grids and water supplies.
Potential impact on the community
Data centers can consume as much electricity as 100,000 households annually, and the largest facilities under construction may demand twenty times that amount, according to the International Energy Agency. By pausing the Verrus project, Salem officials aim to protect residents from possible rate hikes and ensure that any future development aligns with community values and environmental stewardship.
Next steps
The city will use the moratorium period to assess power‑grid capacity, water usage, and cooling‑system plans. Officials also intend to hold additional public hearings so that citizens can weigh in on whether the project ultimately serves the public good.
“These moratoriums help local governments craft policies that balance quality of life, environmental protection, and industrial development,” said Bonds. “They let us determine at what point enough is enough and data‑center development is no longer desirable.”
PolitiFact researcher Caryn Baird contributed to this report.
Original reporting: 40/29 / KHBS (NW Arkansas) — read the source article.
