Michigan City council tables data center approvals after lengthy public hearing and technical Q&A

After a three-hour public hearing that drew more than two dozen speakers, the Michigan City Common Council on Monday paused final decisions on multiple measures tied to a proposed data center at 402 Royal Road, introduced by Phoenix Michigan City Investors and tied to a proposed end user the city identified as Lavender Fields Holdings. The council voted to table related resolutions and ordinances for one month to allow further study and public outreach.

The petition and related resolutions prompted sustained public comment and technical presentations. Redevelopment director Skyler York told the council the Economic Revitalization Area (ERA) under consideration "is the tool that allows us to grant abatements." He said the ERA in this case is intended to enable a longer, up-to-40-year abatement if the project moves forward. York also said the ERA would apply to the developer, Phoenix Industries, and could be used for this project or another in the future.

Why it matters: Residents and nearby stakeholders raised questions about noise, diesel backup generation, water use, air emissions, traffic and whether the city’s electric utility and regional grid can support the site without increasing residential rates. Council members repeatedly asked for independent analysis and assurances about the municipal impacts before voting.

Key facts and actions - Public comment: More than 25 people spoke. Speakers included residents, former service members, union representatives and members of regional environmental groups. Concerns included low-frequency noise, diesel emissions from backup generators, electric and water capacity, and long-term local economic benefits. - Developer presentation: John Perre of Phoenix Investors and engineering representatives presented technical summaries. On noise, the developer said an acoustic study was completed and "we're already under the limits at the property line." On water, the developer said the project uses a closed-loop chilled-water system and that "the initial fill" is the primary water demand; subsequent use is makeup water. - Utility and water briefings: A NIPSCO public affairs representative acknowledged the company has proposed a Genco model to address large new loads and said the model is before the Indiana Utility Regulatory Commission; she said the proposal is intended "to protect our existing customer base." Chris Johnson, Michigan City Water Works superintendent, said the city’s treatment plant has capacity: the plant is built for 30 million gallons per day and currently averages about 6.6 million gallons per day, with a tested maximum day of about 9.1 million gallons. - Council motions and votes: A motion to table the data-center item indefinitely failed (3–7). A later motion to postpone action for four months failed (4–5). A motion to table the items for one month passed (5–4). Council later voted to suspend rules and table the remaining related resolutions until the first meeting in September (9–0 on the suspension).

Discussion vs. decision - Discussion only: Large portions of Monday’s meeting were public comment and technical Q&A; concerns about health impacts and cumulative grid demand were widely expressed but were not resolved by the council. - Direction/assignment: The council directed staff to collect additional information and to pursue outside analysis as needed; members asked staff to arrange tours, obtain regulatory and rate information from NIPSCO and regulatory staff, and to assemble independent noise/emissions expertise. - Formal action: The council formally tabled (postponed) the data-center-related resolutions and ordinances for one month; later the council suspended rules to table the remaining data-center resolutions until the first meeting in September.

Notable quotes (from meeting transcript) - Skyler York, director of redevelopment: "ERA, the economic revitalization area, is the tool that allows us to grant abatements." - Phoenix representative (engineering/operations): "We've already had the sound study done, and we're already under the limits at the property line." - NIPSCO public affairs representative: on a proposed Genco model, "we're creating the Genco model in order to protect our existing customer base."

Community response and outstanding questions Residents asked for more transparency about the end user, for independent monitoring (noise monitors around the property), and for written detail about projected jobs, utility rates, fuel for backup generation and decommissioning plans if a facility becomes obsolete. Council members repeatedly requested documentation on whether additional electric infrastructure would shift costs to residential ratepayers, and asked for the IURC (state utility regulator) analysis if external parties seek a separate generation company structure.

Next steps The council set reconsideration in one month and asked staff to gather data the public requested: the NIPSCO regulatory answers, the water department’s capacity analysis, the developer’s noise and emissions reports and the identity and commitments of the end user to the extent the NDA allows disclosure. Council members indicated they expect follow-up presentations and written materials prior to reconsideration.

Ending note The council emphasized both the need for economic development tools and the public’s request for independent evidence about environmental, health and fiscal impacts. Multiple council members and the mayor said they want more time to review technical reports and to ensure residents’ concerns are addressed before any final approvals are given.