Rezoning to restrict data centers, boosts site plans, passes first vote

The first reading of two new ordinances, one specifically dealing with Bitcoin mines and data centers, passed without comment. Changes to the M-2 Manufacturing Warehouse District and bolstering of its site plan review process, previously approved by the planning board, will now move to a public hearing and second reading. The next Mountain City Mayor and Board of Aldermen meeting is on March 3. Neither ordinance amendments received any comment from the aldermen or mayor. At the Jan. 22 planning board meeting, First Tennessee Development District Community Planner Cory Haggard said they can't ban data mining centers outright "because it creates a legal situation that judges and lawyers would have to handle," The answer, in this zoning ordinance, is to place data mining, Cryotpocurrency and Bitcoin in the town's "most restrictive zone, like we have done with other things that we essentially don't want to see in town." In 2025, the town wrestled with a proposed Bitcoin mine that would have gone in southern Mountain City, adjacent to S. Shady Street. Numerous residents protested the mine, essentially saying it went against the character of the town in many different ways. Eventually, when the landowner wished to rezone his land to build the mine, the town bowed to public pressure and the aldermen and mayor denied the rezoning, killing the Bitcoin mine. For an M-2 district to be created in the future, it would have to be approved by the planning commission, be the subject of a public hearing, be approved by the Board of Mayor and Aldermen twice, and meet "very thorough" stipulations for spot-zoning, Haggard said. The amendment defines data mining centers as facilities that host computer systems for the purpose of handling "large volumes of digital data." The ordinance change lists "Cryptocurrency Mining Operations, such as Bitcoin mining" and "General Data Processing Facilities, such as those used for artificial intelligence" as two examples. The site plan amendment, Haggard previously explained, would create more specific criteria for when a site plan needs to be submitted to the planning commission. The amendment states that "all new commercial developments or redevelopments" in non-residential districts and Planned Residential Development (PRD) districts need a site plan. "Multiple duplexes, two-family, multi-family, group housing project, planned unit development, condominium development, public or semi-public use and wireless transmission facilities" will also need a site plan. The amendment gives detailed requirements in the following areas: general provision; buffer strip; off-street parking and access; waste disposal; mechanical equipment; service, loading, and equipment storage areas; outdoor storage and sales of merchandise; utility lines; lighting; storm-water drainage.