The Hillsboro City Council voted unanimously Tuesday, Oct. 20, to adopt the city's first permanent limits on data center development, capping total acreage at 608 across three industrial zones. The new rules take effect Nov. 19, according to the Hillsboro News Times.

The change is steep. Previously, data centers could locate across roughly 6,600 acres in 12 zones citywide, including commercial, business park and urban center areas. The ordinance narrows that to two primary zones: Industrial Park, capped at 215 acres, and Industrial Sanctuary, capped at 310 acres. An additional 83 acres are allowed in portions of the Jackson East area.

Much of that 608-acre cap is already spoken for. The city of Hillsboro reported 203 acres already occupied in the Industrial Park zone and 292 acres in Industrial Sanctuary, leaving fewer than 30 acres available for new standalone facilities between the two zones.

The vote came "with little discussion," the News Times reported, following months of packed council meetings where residents raised alarms about data centers' impacts on land, energy and neighborhoods.

Council President Rob Harris warned during the Oct. 6 first reading that without action, data centers could consume "thousands of acres" of land in future Hillsboro developments, The Oregonian reported.

The ordinance also tightens rules on accessory data centers, the smaller computing operations businesses run alongside their main work. Those facilities cannot exceed 25% of a site's gross acreage or 30% of the primary business's floor area, whichever is smaller. They must serve the business, its tenants or partners and cannot lease computing services to outside customers.

During the Oct. 6 first reading, councilors voted 5-1 to strip a provision that would have let businesses move accessory data center space to a separate property in an industrial zone. Councilor Kipperlyn Sinclair pushed for the removal, arguing it could open additional areas to data centers and create pockets of environmental impacts before the city fully understands those effects, the News Times reported. Councilor Cristian Salgado cast the lone dissenting vote.

A 1,000-foot buffer between data centers and schools made it into the final ordinance, but with a sunset. The buffer expires Oct. 31, 2027, unless the council extends it. Councilors made it temporary after questioning whether enough research supported the specific distance.

The ordinance also restricts energy storage facilities, capping them at 12 acres per site in industrial zones. All new data center and energy storage applications now require a public hearing before the Hillsboro Planning and Zoning Hearings Board. Previously, most were approved through staff review.

Hillsboro's temporary moratorium on new standalone data center development remains in place through Nov. 24. The city describes the ordinance as Phase 1 of a two-phase process. Phase 2, expected to begin in early 2027, will address building heights, additional buffers, green-building requirements and other environmental protections, informed by studies now underway.

Data centers in Hillsboro received $84 million in local property tax breaks last year and employed 284 people, according to Washington County records cited by The Oregonian, which calculated that at $296,000 in tax breaks per job per year.

The council is expected to consider extending the moratorium for an additional six months at an upcoming meeting, according to the city.