California Cities Rethink Data Centers as Residents Demand Transparency

Behind Monterey Park’s ban on data centers

HMC Stratcap is an Australian Company that planned to build an AI data center at an office park near State Route 60 in Monterey Park. The center could have spanned up to 250,000 square feet — with the capacity to provide close to 50 megawatts of power — or enough to power thousands of homes.

Yun Wang, 50, has lived in Monterey Park since 2008. Wang said he lives about a mile from the office park.

“This whole area could have become a data center alley, similar to Northern Virginia,” Wang said as he drove up to the site.

He added that many residents didn’t find out about the plans until a year after they were drafted, when the city was getting ready to approve an environmental report for the project. In that report, the city shared that HMC Stratcap’s proposed data center “did not pose significant harm to the environment.”

A year prior, in November 2024, the city changed the land use designation at the office park location to help accommodate future data center construction.

“No one knew what was going on. The details were obscure,” Wang said. “They were moving things along [under] the cover of night, I would say.”

Wang said most of the council seemed more interested in the possible tax revenue that data centers could bring, instead of advocating for constituents. Wang also said the council failed to address residents’ concerns about water and electricity use.

“I was very disappointed that my representative didn’t stand up for our city, and so far as how the city council handled everything,” Wang said.

So, Wang began canvassing home by home in his neighborhood. He later became a part of a growing coalition of people and groups opposing data centers in Monterey Park and the larger San Gabriel Valley area.

Wang claims the coalition even held their own educational meetings known as “teach-ins.” The public backlash led council members to reconsider their stances, and in March, Monterey Park’s city council unanimously voted to place a measure banning data centers on the June ballot. After voting, Councilmember Jose Sanchez thanked residents for educating him about the impacts of data centers.

Wang said that aside from Sanchez, he remains skeptical of most council members, including his own representative. He also said HMC Stratcap’s approach intensified the backlash among Monterey Park residents, adding that the Australian company never reached out to the community or addressed their concerns until residents protested.

Instead, Wang said it was the community’s ability to come together and educate one another that helped make the difference at the polls.

“I can tell you that what went wrong with HMC was their community engagement was nonexistent,” Wang said. “They need to know where the residents stand, and not waste our time and not waste our money.”

HMC Stratcap did not respond to KVCR’s requests for comment.

Experts argue transparency matters when proposing data centers

Scientists and experts studying the impacts and benefits of data centers argue that it’s fair for communities to ask questions about transparency, especially around energy and water use.

Kate Stoll with the American Association for the Advancement of Science claims that the data center industry is trying to address environmental concerns. For example, she said, they’re using new technology like closed-loop cooling, which requires less water by recycling it. However, the system also requires more electricity.

Stoll said some communities may decide whether they can absorb some of the impacts. She also emphasized that not every data center or developer is the same.

“Some are better at community engagement up front. Some are better at making and sticking to sustainability practices than others,” Stoll said. “But I think transparency brings trust.”

“Once you lose trust, it’s harder to build it back up and that might be the case in some of these communities,” she added.

For now, it appears that the tech and data industry has taken an opposite strategy. The industries lobbied to kill a state bill that required data centers to disclose their water use. Governor Gavin Newsom vetoed Assembly Bill 93 in October because the economic impact was unclear.

Khara Boender, the director of state policy with the Data Center Coalition, said the bill could have required centers to reveal trade secrets. The Data Center Coalition was among the groups that lobbied against it.

Still, Boender said the data center industry could benefit from engaging with communities early on and answering their concerns.

“I think we’re also seeing many of our members engaging early and often with these communities to try to provide a better understanding,” Boender said.

Data centers in Coachella placed on hold after weeks of protest

Aside from Monterey Park, many cities across the state are now implementing moratoriums on data center approvals and considering their own bans on data centers entirely.

In the city of Coachella, a data center company’s failure to engage residents put plans to build six data centers in the desert city on hold. In May, residents packed city council chambers after discovering that the city council had signed an agreement earlier that year with Stronghold Power Systems.

The Riverside County-based company builds energy infrastructure. It entered into an agreement to create a city-owned electric utility, paid for by developing data centers. The city’s current utility provider, Imperial Irrigation District, is unreliable because it experiences frequent power outages during the summer. The district, based in the Imperial Valley, is also facing legal challenges after denying a data center developer access to water.

“There weren’t a lot of community members who were informed about these plans,” said Stephanie Ambriz, a Coachella resident who helped mobilize opposition to the agreement and data centers.

Ambriz said she was outraged because the city didn’t include residents in the process, and added that she believes the council seemed oblivious to how much water data centers use. The Coachella Valley is already struggling with challenges to water access due to the depletion of watersheds like the Colorado River.

“We’re already living in this time where the city of Coachella needs to address our drinking water situation, and they’re introducing data centers,” Ambriz said. “It’s tone deaf. It’s enraging.”

After hundreds of public comments, the city council in June approved a 45-day temporary pause on data centers.

Ambriz said that the people’s voices mattered and the council listened this time. However, she thinks it’s too soon to celebrate.

“It’s going to be a long road,” Ambriz said. “I don’t anticipate Stronghold is going to take too kindly to it. There is a lot of distrust now between our community and local government.”

Nonetheless, Ambriz said, Coachella residents want to make sure the council sticks to their decision — and keep working on a plan to draft a permanent no-data-center ordinance.

This story was edited with support from The California Newsroom, a collaboration of public media outlets throughout the state. It was originally published by KVCR.