Land & Renewables Connection

The “cloud” is an ever-present part of modern life. It can be difficult to watch television or to read something on the internet without seeing some reference to, or advertisement for, the “cloud”. In fact, what you are reading was saved “in the cloud”. But, despite references to the “cloud” conjuring up images of data floating freely in the limitless expanses of the blue sky above, the reality is much different. The “cloud” physically exists. It exists in physical equipment that is most likely located in unassuming data centers across the country, or around the world.

The rapid progression of information technology and artificial intelligence (AI) that has resulted in companies reducing their physical footprints has paradoxically caused the proliferation of a different group of structures - data centers. Data centers are facilities that house infrastructure that forms the backbone of online activities. This infrastructure includes servers, storage devices and other types of network equipment.

 As companies continue to move computing and storage processes “off-site”, as the amount of data continues to rapidly grow, and as AI continues to develop and require massive amounts of computing power, data centers will likely become more prevalent. That means that community land use and zoning decisions must take data centers into account, amongst the many other types of land uses that exist or that may exist in a community. A recent Virginia case highlights the tension between providing for these facilities and balancing existing community expectations.

On September 16, 2025, the Court of Appeals of Virginia released its decision in Caparoula v. Board of County Commissioners of Prince William County, No. 1137-24-4 (Va. App. Sept. 16, 2025). The Caparoula matter was a zoning appeal that challenged the rezoning of 270 acres of land in Prince William County, Virginia from a “mixed use” zoning district to a light industrial zoning district that specifically authorized data centers.

Prince William County is located in northern Virginia, a region that is one of the principal data center hubs in the United States. The 270 acres in question in Caparoula was originally zoned for agriculture but had been rezoned to a “Planned Mixed Residential” zoning district. That land was apparently in a fairly densely developed area, with the zoning appeal contending that 3,759 homes were within some degree of proximity to this property. Aerial images show what appears to be a reasonably dense, suburban community.

 In late 2022, the 270 acre property’s owner proposed to re-zone it to a “Light Industrial” zoning district, where data centers were authorized land uses. The purpose of the rezoning seemed to be focused on using the land for a data center(s). The County’s governing body received hours of public testimony over several months regarding the proposed rezoning. Most of that testimony opposed the proposed rezoning. As the rezoning process went forward, the property owner proposed to use some of the property for a public park and to make multi-million dollar contributions for public park infrastructure. Otherwise, the property owner contended that the proposed rezoning,which would allow the property to be used for data centers, would generate economic development, job creation and increased commercial tax revenue.

Toward the end of the public hearing process, the property owner removed the proposed public park and $5 million contribution for park infrastructure from the proposed rezoning ordinance. But, the County’s governing body still voted to approve the amended rezoning ordinance. As a result, the 270 acre property was re-zoned to light industrial zoning, along with the expansion of a data center overlay zoning district to include this property. The property could be developed for data centers.

Some neighboring land owners appealed this rezoning decision, contesting the impacts of data centers on surrounding lands and challenging the means by which the rezoning of this 270 acre property occurred. The County and the property owner challenged the appeal, contending that it lacked merit. The appeals court agreed with the County and the rezoning property owner, dismissing the landowners’ appeal of that rezoning decision.

The County and the owner of the rezoned property initially contended that the appealing landowners lacked the legal standing to pursue their appeal. The court disagreed on that front. But, the court agreed with the other challenges asserted by the County and the rezoned property owner against the landowners’ appeal of the rezoning decision. The principal appellate argument that the challenging landowners asserted was that the rezoning itself violated ordinances, violated statutes, and was ultimately arbitrary. This argument included both a procedural argument and a substantive argument.

On the procedural front, the objecting landowners contended that because the proposed rezoning ordinance was substantially amended during the public hearing process, the law dictated that the amended ordinance needed to be reviewed by the county’s planning commission before it could be voted upon by the County’s governing body. The reviewing court disagreed with that contention. The court found that the County’s governing body had the discretion under the law to proceed in the manner that it did.

The objecting landowners fared no better on their substantive argument that the rezoning ordinance violated the law and was also arbitrary. The court made it clear that rezoning is a legislative act, so courts do not have jurisdiction to determine whether the correct legislative decision was made. From that framework, the appeals court found that the legislative issue of rezoning was amply debated in this case and that the record established that it was “fairly debatable” which was the applicable standard.

Lastly, the court rejected the neighboring landowners’ argument that the rezoning was an example of illegal “spot zoning”, where one party’s private interests were given priority over the general welfare of the community. The court determined that the record of the public testimony preceding enactment of the ordinance showed public benefits like job creation and increased tax revenue.

While the Caparoula decision involved a rezoning of land in Virginia that is hours away from Pennsylvania, it does provide value for Pennsylvania municipalities, property owners and prospective data center developers. The Caparoula rezoning process highlights the need to proactively plan for data centers and other infrastructure associated with an information-based economy in a way that promotes economic development while simultaneously preserving the health, safety and welfare of the community.

The need for municipalities to proactively consider new and developing land uses is already addressed in the Pennsylvania Municipalities Planning Code, which governs zoning and land use for all municipalities in Pennsylvania other than Philadelphia and Pittsburgh. It states that zoning ordinances “. . . should reflect the policy goals of the municipality as listed in a statement of community development objectives, recognizing that circumstances can necessitate the adoption and timely pursuit of new goals . . “ 53 P.S. 10606. Among the considerations influencing ordinances are things like “density of population”, “commerce and industry”, and “the location and function of streets and other community facilities and utilities.” Id.

Those considerations are particularly important when addressing data centers, which present an interesting type of land use given their unique nature. Traditionally, zoning has grouped land uses into general categories of residential uses, commercial uses, and industrial uses. See, § 9:14. Cumulative zoning ordinances, 1 Am. Law. Zoning § 9:14 (5th ed.). The popularity of “mixed use” developments has somewhat blurred these lines, but most municipalities still view land uses through a residential, commercial, or industrial framework.

Computing devices generate a lot of heat. As a result, data centers have substantial cooling needs. Large amounts of power and water are needed to address these cooling needs. These inputs can place a lot of stress on existing infrastructure. These cooling needs can also generate noise issues, with fans and other air conditioning devices creating a noise and sound impact. If diesel generators are used as back-up power sources, that can create air pollution issues.

Data centers have no fixed size; they run the gamut from thousands of square feet up to hundreds of thousands of square feet. Just as the size of data centers vary, so do their numbers of employees, ranging from just a few employees to larger numbers of workers. And, whereas data centers have significant infrastructure needs in terms of electricity, water and connectivity to fiber optic cable connections, other traditional infrastructure demands of industrial facilities are not as prevalent, such as robust road and/or rail connectivity to move large volumes of raw materials or refined goods.

In Caparoula, zoning for data data centers on that 270 acre property was accomplished through a light industrial zoning district and a data center overlay district. Other municipalities address zoning for data centers in other ways. But, the bottom-line is that municipalities should review their zoning ordinances to see if, and how, they address data centers - just like municipalities should review their zoning ordinances in the context of new and expanding land uses.

If zoning ordinances address data centers and provide criteria identifying where these uses can be located and enumerate specific criteria that must be demonstrated by a developer to ensure the health, safety and welfare of the community, then both existing residents, business owners and prospective developers have greater certainty. The key is to contemplate and address these issues early, to avoid the inevitable friction that comes from certain types of uses in close proximity to one another.

Although Pennsylvania does not have the same concentration of data centers as northern Virginia, there are growing numbers of data centers across Pennsylvania. As more and more data centers emerge to support the growing use of machine learning, AI and the rapidly increasing amounts of data generated by modern life, there are likely to be tensions, challenges and benefits involving the locations of data centers in Pennsylvania municipalities. Failing to address data centers at all, or generically doing so as part of a “catch all” zoning structure does not seem to be a viable way to address this type of land use for any party, whether the municipality, residents or developers.

If you have questions about this post or zoning issues, contact Brendan A. O’Donnell at (412) 288-2226 or odonnellba@hh-law.com.