Oregon city declares 'state of emergency' after statewide ban causes it to lose data center revenue

• Oregon city declares an emergency over $6 million in threatened revenue
• Statewide data center restrictions threaten more than $5 billion in investments
• Umatilla faces possible delays to its planned new police station

An Oregon municipality has declared an emergency after statewide restrictions on new data centers threatened approximately $6 million in expected municipal revenue.

Umatilla officials warned state Governor Tina Kotek's suspension of environmental permitting could disrupt infrastructure projects, employment opportunities, and billions in private investment.

The emergency declaration addresses anticipated financial losses rather than an existing budget crisis, with municipal reserves remaining at historically high levels.

Revenue losses threaten public infrastructure projects

The city's financial projections include income from planned data center developments, with some proceeds expected to support major public infrastructure improvements.

Among the threatened projects is a proposed police station, alongside several million dollars in planned upgrades to municipal water infrastructure.

City manager Dave Stockdale warned that interruptions to expected payments would force officials to reconsider schedules for improvements already incorporated into financial plans.

Umatilla currently hosts four operational data centers, while another facility is being constructed and two additional developments are awaiting completion.

The local industry includes Amazon Web Services and Sabey Data Centers, whose operations contribute to the area's expanding digital infrastructure sector.

Municipal estimates indicate that the permitting restrictions could jeopardize more than $5 billion in prospective private investment associated with local developments.

The council also identified risks to at least 1,000 construction jobs, alongside hundreds of permanent positions and employment opportunities in supporting industries.

Projects awaiting regulatory approvals could experience delays exceeding two years, while some developers might abandon their investments or move elsewhere.

“These consequences extend far beyond the interests of individual businesses. They threaten the broader economic and financial well-being of the Umatilla community,” said Dave Stockdale, Umatilla city manager.

“I believe the Governor's directive creates precisely the type of human-created circumstance involving threatened widespread financial loss that Oregon law expressly recognizes as a potential emergency.”

Despite these concerns, officials confirmed that existing municipal services and financial obligations remain unaffected because the disputed revenue has not been received.

Statewide restrictions and emergency response

Kotek instructed Oregon's environmental authorities in October to suspend new pollution permits for data centers, effectively restricting development until July 2027.

The governor previously halted transactions involving state-owned land intended for such facilities, allowing officials to examine their potential long-term consequences.

That directive followed an August decision preventing the sale of 32 acres at Salem's Mill Creek Corporate Center for a Verrus development.

Individual municipalities have also introduced restrictions, including Hillsboro, which imposed a 120-day suspension on new data center developments in July 2026.

Umatilla's council approved an emergency resolution requiring reconsideration within 90 days, following a formal request submitted by Stockdale to elected officials.

The resolution authorizes an economic assessment of projected losses and calls upon Kotek to reconsider the restrictions without further delay.

Stockdale claims that the city had not received or spent the expected data center revenue, although it had included the money in future financial plans.

He explained that the declaration was intended to protect future investment plans rather than address an immediate shortage of municipal operating funds.

The assessment will examine potential consequences for municipal financing, employment and infrastructure schedules while officials seek changes to the state's permitting policy.

Via DCD

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