Data center developer CRG says it is eyeing Festus as a potential area for data center development after the city council moved to annex several parcels of land.
In a statement to St. Louis Public Radio, CRG President Chris McKee confirmed the company is pursuing potential data center development on the recently annexed land and said informal conversations with city officials regarding rezoning applications have taken place.
CRG is St. Louis-based Clayco’s data center development arm. In August, the company withdrew its attempt to develop a 440-acre data center in St. Charles.
He said the developments could generate an estimated $30 million to $40 million in local tax revenue and provide "transportation benefits” to the city, its school district, the county and other tax-funded services in the area.
City Administrator Greg Camp said the project could be at least $1 billion, a fiscal injection unlike anything the area has experienced, even with possible abatements and incentives.
“It's unlike anything that any of these, certainly the city, or any of those institutions, those organizations, have ever seen before,” Camp said. “That type of investment is transformative. The resources that would become available to make an impact in everyday life is really something that, again, you just don't see on that scale, on a regular basis."
It’s not clear what sort of tax incentives or exemptions the proposed projects could vie for or receive, which can largely impact their economic impact. Camp said it's far too early in the process to say. He said even the scale of the project has only been discussed in hypotheticals.
The Festus City Council unanimously voted Monday to annex 240 acres north of Highway 67 and west of Highway CC for the possible data center development.
“We have not been asked to sign any nondisclosure agreements,” Camp said at the meeting. “Festus is on strong footing to move through this process and has effective guardrails to support positive developments for our community.”
Previously, the city enacted regulations requiring data center developers to notify residents who live near the facility of its construction, limit noise produced by the structures to 60 decibels and hold meetings with the community about the project.
“We are committed to pursuing this project in a transparent manner and have not asked anyone to sign a nondisclosure agreement,” McKee said.
The news of the development comes during a wave of pushback over data center development in the St. Louis area. Hundreds of people attended town hall meetings over a possible development in Midtown St. Louis at the vacant Armory building.
Backlash over a project possibly linked to Google in St. Charles led to a yearlong moratorium on any data center proposals in the city.
Camp said the city has already received backlash on the possible projects. He urged the public to educate themselves on data centers and to bring “thoughtful” conversation, pointing to what he called “lacking” information about data centers.
“We're expecting pushback, and we are getting pushback,” Camp said. “If anyone — certainly, especially any of our residents — wants to have a conversation about what these do and don't do, what they can do for the community, for our school district, for the county — that's a conversation we're willing to have.”
Camp stressed that the city is in early discussions with CRG and that no proposal has been officially submitted. He called talks with the company informal.
“We're so early in this process to assume certain things related to power or light or sound or water,” Camp said. “We don't even have a proposal in front of us; it's way too soon."
