Dealing with data centers | Kendall Cotton – The Missoulian

There is a peculiar kind of tension brewing across the Big Sky Country right now, and it isn’t the usual friction between urban growth and rural preservation. Instead, Montana is finding itself at the center of a modern ideological war over something largely invisible: the data center. As we’ve seen in recent discussions and opinion pieces in the Missoulian, these massive server farms have become the latest “populist punching bag.” To some, they represent a digital gold rush that could modernize the state’s economy. to others, they are monolithic eyesores that suck up electricity and water while offering little more than a handful of low-level security jobs in return. It’s a classic Montana conflict—the desire for progress clashing head-on with a fierce, protective streak regarding land and resources.

The debate has reached a fever pitch, with some members of the Montana State Legislature even calling for a four-year state-wide moratorium on new data center developments. On the surface, a pause seems like a prudent way to “study the impact,” but as Kendall Cotton of the Frontier Institute points out, such a move is often severely misguided. When you shut the door for four years in the tech world, you aren’t just pausing; you’re effectively deleting yourself from the map. The risk is that Montana becomes a footnote in the digital infrastructure race, losing out on massive economic opportunities simply because the fear of the unknown outweighed the willingness to regulate smartly.

The Economic Tug-of-War: Growth vs. “Free Rides”

The core of the issue isn’t necessarily the existence of data centers, but the terms of their arrival. For too long, the playbook for attracting big tech has been a race to the bottom—offering lavish tax abatements, specialized zoning breaks, and government handouts to lure a company that might otherwise go to a neighboring state. This is where the skepticism becomes reasonable. When a company consumes a disproportionate share of a town’s power grid or water supply, the community expects a proportional return in the form of tax revenue and infrastructure investment. The “no free rides” philosophy is gaining traction here, and rightfully so.

If we look at the broader economic landscape, the Montana Department of Commerce is tasked with balancing this growth. The goal should be a framework where data centers pay their fair share of property taxes and contribute to the local grid’s resilience rather than straining it. There is a second-order effect here that often gets missed: the “clustering” effect. Once a major data hub is established, it often attracts ancillary services—fiber optic upgrades, specialized electrical contractors, and hardware maintenance firms. This creates a more robust local economic ecosystem that benefits more than just the tech giant at the center of the web.

The Environmental and Social Friction

Beyond the balance sheets, there is the physical reality of these facilities. Data centers are energy-hungry beasts. In a state that prides itself on its natural beauty and sustainable resources, the prospect of a facility consuming megawatts of power can feel like an assault on the landscape. Then there is the water. Cooling these servers requires millions of gallons of water, and in the arid West, water is more than a resource—it’s a lifeline. The opposition isn’t just “clicking for views” on social media; they are expressing a legitimate fear that corporate needs will supersede municipal water rights.

However, the counter-argument is that modern data centers are becoming significantly more efficient. We are seeing a shift toward “edge computing” and the use of natural ambient cooling—which is where Montana’s cold winters become a competitive advantage. By leveraging the climate, these facilities can reduce their carbon footprint and water usage compared to centers in Virginia or Texas. The challenge for Montana is to create a regulatory environment that mandates these efficiencies rather than banning the industry entirely.

Navigating the Local Impact: A Guide for Montanans

Whether you are a landowner in the Missoula valley, a city council member in Helena, or a business owner concerned about power stability, this trend is going to touch your life. Given my background in analyzing the intersection of public policy and regional economics, I’ve seen how these industrial shifts can either revitalize a community or leave it hollowed out. If the data center trend continues to expand in your area, you cannot rely on generalists to protect your interests.

You need a specific set of experts who understand the nuance of “digital industrialization.” If this trend impacts your property or your municipality, here are the three types of local professionals you should be consulting to ensure the community wins as much as the corporations do:

Specialized Land-Use and Zoning Attorneys

You don’t just need a real estate lawyer; you need someone who understands the Montana Environmental Policy Act (MEPA) and industrial zoning bylaws. Look for a professional who has a track record of negotiating “Community Benefit Agreements.” These are the legal documents that ensure a developer provides specific perks—like funding for local schools or park improvements—in exchange for zoning variances.

Energy Infrastructure & Grid Consultants

With the power grid under increasing pressure, you need an independent expert to analyze the “load impact” of a proposed facility. Seek out consultants who can perform an independent audit of the local substation capacity. The goal is to ensure that the arrival of a data center doesn’t lead to brownouts for residential neighbors or spiked utility rates for small businesses.

Municipal Finance & Tax Strategists

To avoid the “free ride” scenario, local governments need advisors who specialize in public finance and tax incidence. Look for experts who can structure “clawback provisions”—contracts that require a company to pay back tax incentives if they fail to meet specific job creation or investment milestones. This ensures that the government budget balance remains healthy regardless of the company’s long-term success.

The conversation around data centers in Montana is a litmus test for how the state handles the 21st century. You can either retreat into a moratorium of fear or step forward with a sophisticated, firm, and fair regulatory framework. The “populist punching bag” only exists when people feel they have no seat at the table. By bringing the right expertise to the negotiation, Montana can ensure that the digital future doesn’t come at the expense of its timeless character.

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