Data centers: what Spokane can and cannot decide
In June 2026 the City paused new data centers inside Spokane for a year. Three data centers have been proposed in the region. Only one of them is inside the city, and it is the smallest.
Three proposals, one boundary
A city moratorium stops at the city line. Two of the three proposals are on the other side of it.
| Proposal | Where it would go, and how big | Covered by the City moratorium? |
|---|---|---|
| Avista's unnamed customer | Somewhere in north Spokane County. A phased plan starting at 125 megawatts in 2029 and reaching 500 megawatts by 2032. That is roughly half the power used by every home and business in Spokane County. Avista paused negotiations on June 12, 2026. The company has not been identified. | No |
| Apricus, the Big Rock project | 11703 West Medical Lake Highway on the West Plains, west of Spokane International Airport, as part of a hydrogen production facility. Documents obtained by The Spokesman-Review describe it eventually seeking 1,000 megawatts. Avista's entire Washington and Idaho service area averages about 1,100 megawatts. | No |
| The tech hub sublease | 1514 S. Flint Road in west Spokane, the former Triumph Composite Systems building. Council Member Zappone said in June 2026 that the tech hub was in talks to sublease part of its site to a data center. No size has been stated publicly. | Yes |
What follows from that. Ordinance C36887 blocks building permits for new data centers inside Spokane for one year. It reaches the smallest of the three proposals and neither of the two largest. Council President Betsy Wilkerson said as much when she closed the July 29 hearing: a lot of this activity can happen outside the city and still affect residents, and some of it could happen on tribal sovereign land the City has no control over.
How an aerospace project ended up in a data center hearing
Spokane's tech hub is the American Aerospace Materials Manufacturing Center. It is a consortium of roughly 50 companies, agencies, and schools, including Boeing, Spirit AeroSystems, Collins Aerospace, Toray, NASA, Pacific Northwest National Laboratory, and Gonzaga. Its subject is lightweight composite materials for aircraft. It is not a data center.
The chain runs like this. The federal Economic Development Administration designated the consortium a Regional Technology Hub in fall 2023, which allowed it to pursue up to $70 million. It was awarded $48 million in January 2025. The U.S. Department of Commerce rescinded that award in May 2025. Mayor Lisa Brown called the reversal "an unnecessary setback" and asked the congressional delegation to press for it to be undone.
By June 2026, Council Member Zack Zappone said the tech hub was in talks to sublease part of its site to a data center to help offset some of a $20 million funding gap. Because that site is inside city limits, the moratorium reaches it. Some residents testified that this amounted to a private data center arriving inside a public project that had broad support.
What a tech hub overlay zone would do
An overlay zone is a boundary drawn on the zoning map on top of the zoning already there. Inside the boundary, certain rules are added, relaxed, or replaced, and the zoning underneath stays. Cities use them for historic districts, airport noise areas, and shoreline rules. The tool is ordinary. What it does depends on where the line goes and which rules change inside it.
In February 2024, before any of this, Mayor Brown said the City would designate a tech hub overlay zone to help with permitting for the aerospace project. At the July 29, 2026 hearing, Council Member Michael Cathcart asked whether the review could begin with the tech hub and consider such a zone, noting that this was already the Mayor's own plan. Adam McDaniel of the Mayor's Office answered that it would be premature to predict what the reviewing boards will recommend.
An unresolved disagreement sits underneath the request. Zappone has said the ordinance as adopted only blocks projects drawing more than 25 megavolt-amperes, so the tech hub was never caught by it. Cathcart voted against the moratorium and has continued to press for a written carve-out. Two Council members disagree about whether the tech hub is affected at all, and the July 29 hearing did not settle it.
The City's strongest lever is water, not zoning
Most new commercial development on the West Plains is served by Spokane water, whether or not it sits inside the city.
Mayor Brown put it plainly in July 2026: whether or not a project is within the city boundaries, the City is the water purveyor for the region, so the City has to be part of those discussions. That applies to sites the moratorium cannot touch.
The limit is that the City has a duty to serve. Brown has said the City's ability to refuse a water customer is narrow, though it retains some ability to set what service costs. Council President Wilkerson noted that City Council is the water board for Spokane and said she had requested a study session from legal counsel on what authority the Council actually holds.
What to ask. What can the City require of a large water customer outside its boundaries? What does duty to serve oblige, and what does it leave open? Who decides what the service costs, and are existing ratepayers protected?
Did the data centers get their tax break?
Not in Spokane. The exemption they would have used was written, heard once, and never voted on.
Washington excuses qualifying data centers from sales and use tax on servers, power equipment, and the labor to install them. There are two versions. One is for rural counties. The other, added in 2022, is for counties with more than 800,000 residents, which means King, Pierce, and Snohomish. Spokane County is not rural under the state's definition and is not large enough for the second, so neither one reaches here.
House Bill 2655 would have written a third version for Spokane County alone. Rep. Timm Ormsby of Spokane sponsored it with five others in January 2026. It had one hearing in the House Finance Committee and went no further. The Spokesman-Review reported that it was aimed at two proposed facilities and would have required 35 permanent family-wage jobs, or three for every 20,000 square feet of server space.
The state moved the other direction in the same session. A law effective July 1, 2026 removed replacement servers from both existing exemptions. The reason is written into the law itself: to raise revenue for the general fund.
So a data center built in Spokane County today pays sales tax on its equipment. If that changes, it changes in Olympia, not at City Hall.
Why this incentive is a different question here. A tax break is normally offered for something a place has too little of. Spokane does not appear to be short of data center interest. What is scarce is power. Avista's entire Washington and Idaho service area averages about 1,100 megawatts, and a single unnamed customer asked for 500. An exemption that lowers the price of the scarce thing is doing something different from one that attracts a missing thing. That comparison is a Spokane2046 observation, not a finding by the City or the state.
The 2022 law's own stated purpose is on the record and does not rest on spare electricity. The Legislature wrote that it wanted to improve industry competitiveness and stop losing data centers to Oregon.
What to ask. If an exemption is proposed again, who pays for the added generation, transmission, and substations? Are existing Avista customers held harmless, and is that measured before approval rather than studied years later? Are there deposits, minimum payments, and exit charges if the project shrinks or leaves? How many permanent jobs, and are the taxes recovered if those jobs do not arrive? Does the project bring new power, or use power already planned for ordinary growth?
How the county discussions became public
In June 2026, Spokane County Commissioner Al French said he did not know the name of the company seeking up to 500 megawatts in Avista's service area.
Brittany Anderson, a Spokane resident raising three children in the Corbin Park neighborhood, had been reading about data centers and wanted to get involved. A friend suggested a public records request. She filed one with Spokane County on June 12, 2026, the same day Avista announced its pause, and received the records on July 23. The County charged her $78.
The records showed that French had held Zoom calls and exchanged emails for more than a year with Sean Boyd, the president and chief executive of Apricus, about the West Plains proposal. French told The Spokesman-Review that Apricus is a different company from the one negotiating with Avista, that he had not hidden anything, and that Apricus is the fourth developer to approach him about a data center on the West Plains. Anderson shared the records with the newspaper.
A form and $78. It is the clearest example in this record of a resident using the public record to answer a question the public process had not answered.
Where this meets PlanSpokane
The moratorium directed two bodies to build a Data Center Impact Review and Policy Framework. The Climate Resilience and Sustainability Board begins workshops in August 2026 on water and wastewater constraints, duty to serve, noise mitigation, and decommissioning. It then passes recommendations to the Spokane Plan Commission.
The Plan Commission is expected to hold its own workshops and public hearings in the first half of 2027. That is the same body reviewing the comprehensive plan, in roughly the same window. City Council holds the final decision on any policy that results. The moratorium expires June 22, 2027, which staff described as a due date rather than a deadline.
Both boards meet in public and publish agendas and materials in advance.
What this page could not verify
Three items below come from news reporting or from statements made at a meeting, and Spokane2046 has not confirmed them against a primary document. They are included because they are load-bearing, and flagged because they are unconfirmed.
- The $20 million funding gap is Council Member Zappone's characterization as reported. No document tying it to the rescinded $48 million award has been located.
- Whether the rescinded tech hub award was later restored is unclear. A Washington and Idaho testbed partnership was announced in December 2025.
- The 25 megavolt-ampere threshold in Ordinance C36887 is described here from reporting rather than from the ordinance text.
Council Member Cathcart referred at the July 29 hearing to $60 million to $80 million in potential federal investment. The awarded amount was $48 million, and the 2023 designation allowed the consortium to pursue up to $70 million.