‘It blocks out the sky’: Data center’s big plans rile neighbors in small-town Forest Grove

An Oregonian rendering of Crane Data Centers' proposed buildings in Forest Grove, based on dimensions the company submitted to the city. Each would be about 715 feet long. The first building, now under construction, would be 42 feet high and is in the background of this image. The second building, still in the planning stages, would be 75 feet high in the foreground of this image. Crane says it might not build to the full height it has proposed.

Darci Hanning has lived in her Forest Grove neighborhood for a quarter century, in a house with a small backyard that became her quiet oasis. She and her husband added benches and a bird feeder, and carefully landscaped the lawn that backs up to an empty field. They remodeled the kitchen and are just finishing up a bathroom remodel.

Darci Hanning’s recently redesigned backyard will back up to a pair of data centers being built in a field between residential homes and middle school in Forest Grove.

“We had planned to make this our forever home,” Hanning said. “That’s the kind of updates we’re making.”

A letter from the city upended those plans last year. It notified Hanning and her husband that a San Francisco startup had purchased the field behind her house and planned to build a large data center just over her back fence.

Though the 35-acre field had been vacant for decades, save for seasonal farming, it has been zoned for light industrial use since 1980 — long before the data center industry emerged. Forest Grove never updated its zoning definitions or imposed height restrictions to prevent buildings several stories high from going up next to single-family homes.

A startup from San Francisco plans two large data centers on this field in Forest Grove, abutting several dozen homes. One data center will be 42 feet tall. The second, closer to homes, could be up to 75 feet high.

Crane Data Centers has just begun construction on the first of two large buildings it plans in the field south of Hanning’s home. The company also plans a large, electrical substation at the west end of the property to supply power for the second data center building.

The data centers will abut a subdivision with several dozen homes just north of the site, which is across the street from Neil Armstrong Middle School.

“Hearing that it’s going to be a 70-foot tall building doesn’t please me,” laments Hanning, 62. She said she had no idea the farmland was zoned for industrial uses, and faults Crane for not communicating its plans when the company bought the property three years ago.

“It’s really clear to me that Crane has been stealthy about this,” she said. “They have not been open.”

Oregon has one of the nation’s largest data center industries, drawn by enormous tax breaks worth well over $300 million a year. Until recently, most of those huge server farms have been in industrial parks or in fields far from homes.

Data centers are running out of room in nearby Hillsboro, though, where they have already consumed more than 300 acres of that city’s scarce industrial land. So tech companies are scouting other locations around the metro area for new locations, including in small cities like Forest Grove.

Crane says it wants to be a good neighbor and that it has made changes in its design in response to residents’ concerns. But some of Forest Grove’s leaders admit they were caught off guard by the company’s plans, and say they sympathize with unhappy residents.

Forest Grove’s experience could be a cautionary tale for other Oregon cities, in cases when zoning laws date to the last century at a time no one anticipated Big Tech in small towns.

“That has been devastating for the homeowners in the area,” said Forest Grove City Council member Mariana Valenzuela. “We need to review the zoning ordinances and determine what the requirements should be, because we’re living in different times now.”

Fueled by tax breaks

Forest Grove is the oldest city in Washington County, incorporated in 1872. It was a farming community, anchored by a large dairy industry and railroad depot. A few times a week, a train still runs alongside the subdivision that abuts Crane’s data center site.

Forest Grove residents say they enjoy living in a modest city on outer edge of the metro area, 20 miles due west of Portland.

“I like the small-town feeling,” said Valenzuela, a professor at Pacific University. “People are very kind in this community, very generous.”

Maureen Murphy bought her home in Forest Grove a quarter century ago and has enjoyed looking out across the fields to the hills in the southern distance and watching geese fly over. If Crane proceeds with its plans for a 75-foot data center, in the second phase of its project, Murphy said all that will be gone. She said she won’t even see the sun in the wintertime.

“We’re going to be looking at a seven-story building right behind our house, within 100 feet of our yard,” said Murphy, 71. She said she fears noise from the data center will drone on through the night, upending every hour of her day.

Before Crane bought the field behind Murphy’s home it had been owned by a circuit board manufacturer, a Tektronix spinoff called Merix Corp. that used to be based in Forest Grove and still operates a plant at the far side of the field.

At one time, evidently, Merix viewed the property as a potential factory expansion site. That might have been disruptive to nearby residents in its own way.

Still, Murphy and several other neighbors say they had no idea the field by their homes was zoned for light industry, or that city code puts no limit on how tall industrial buildings can be.

“It blocks out the sky. It puts my house in the shade of this giant building,” said David Haworth, 70, a retired commercial printer. He said he knew nothing about the company’s plans until a letter in small print arrived from the city last year — two years after Crane had acquired the property and too late, it seemed, to find an alternate use for the site.

Crane’s site is in an enterprise zone, which exempts its data center from local property taxes for five years. The enterprise zone program was designed to bring blue-collar jobs into economically distressed areas.

But like Forest Grove’s zoning code, the tax break dates to the 1980s. State lawmakers who created the program didn’t anticipate a sprawling warehouse that employed mostly computers, and very few people.

In the 21st Century, big tech companies have cashed in on the state’s old incentive programs. Amazon, Apple, Google and Meta save hundreds of millions of dollars in Oregon taxes annually, according to research by The Oregonian/OregonLive.

Crane’s exemptions figure to be worth several million a year, based on the size of its planned data center, though after five years the data center and its computers will pay regular taxes. That could be a boon for local governments, eventually, though the initial tax break rankles Haworth and some of this neighbors.

“It pisses me off that they pay no taxes for five years,” he said. “My property taxes are subsidizing the destruction of my own habitat.”

Skepticism, and concessions

This is Crane’s first data center anywhere. The startup says it wants to be responsive to neighbors’ concerns and contribute to Forest Grove’s future.

“This will never be another Hillsboro, where there are a million data centers,” said Connie Zweigle, Crane’s chief engagement officer. “We understand that it’s a small bedroom community that has so many special qualities.”

Crane said it shifted away from evaporative cooling in its new data center, which uses lots of water, in favor of air cooling, which uses more electricity, because Forest Grove residents were concerned about water use.

The company is also paying for road upgrades around its site and says it has chosen less noisy mechanical and electrical equipment, though it didn’t respond to questions about how many decibels they will be.

Crane describes its data center as a 100-megawatt project, which would be triple the amount of electricity the entire city of Forest Grove uses now. It plans to start with 8 megawatts in the first phase of its first building, due to open next summer, and ramp up from there to meet customer demand.

The city’s electric utility will require Crane to pay the cost of power upgrades so the data center doesn’t trigger rate hikes for other customers.

And while Crane’s plans do call for its second building to be 75 feet tall, the company said it hasn’t decided whether it will build to the full height. Crane said that will depend on the needs of its customers and its financial backer, an investment firm called Principal Asset Management.

“We know skepticism is part of the landscape and we don’t expect universal agreement on every decision, but we’re committed to listening, learning as we go, adapting, and taking action to help build trust over time,” Zweigle said. “Our goal isn’t just to build infrastructure, it’s to be a lasting, positive presence in Forest Grove.”

Hands tied, leaders say

At a City Council hearing last fall, Forest Grove leaders sympathized with neighbors’ frustrations about the data centers coming to their backyard.

“They are legitimate concerns about human beings and their lives. And I have a hard time putting that aside in favor of an inanimate process of data,” council President Timothy Rippe told residents who had gathered to contest city approval of Crane’s plans. Rippe, who has subsequently left the council, nonetheless joined all his colleagues in voting to approve Crane’s project.

They said their hands were tied because Crane’s project complies with the city zoning code, and they couldn’t go back in time to change it.

“I’m not going to lie. A 75-foot building? I feel you. I’m like, what can we do about that?” Mayor Malynda Wenzl told her constituents at the October meeting. “We can’t retroactively apply what we should have done. You know, we can only try to do better next time , if we think we made a mistake.”

That was nine months ago.

Forest Grove hasn’t revisited its zoning code in the intervening period. The mayor didn’t respond to several months of messages seeking comment on the city’s plans.

Bryan Pohl, Forest Grove’s community development director, says his department plans to take up zoning issues by the end of the year but doesn’t feel particular urgency because it isn’t aware of any other data centers contemplating new projects.

“There’s nothing on the horizon that would have jolted us to do that at that very second,” Pohl said.

It’s not clear whether other Oregon cities are revisiting their own zoning codes to account for the rise of the data center industry. The League of Oregon Cities said it would look into the topic but didn’t respond to subsequent messages.

The data center industry is booming all across the U.S. and people living in other parts of the country have occasionally objected to new data centers near their homes — and sometimes stopped projects altogether.

In Oregon, the Port of Cascade Locks abandoned plans for a data center in the Columbia River Gorge in 2023 after an outcry from community members who raised concerns about the project’s viability and its impact on local electric service.

North Plains residents voted overwhelmingly last year to reject the city’s proposed expansion of its urban growth boundary, which would have made way for at least one enormous data center in the tiny community.

Bill Tritz lives about a quarter mile away from Crane’s site in Forest Grove. He used to help plan data center construction for Intel and said some of his neighbors’ concerns may be overblown.

“They’re not these huge, noisy things that some people have feared,” Tritz said.

Mechanical systems are much quieter than they used to be, he said, and very few people visit a data center once it’s operating. So Tritz said there won’t be much traffic once construction wraps up.

On the other hand, Tritz said a 75-foot data center really could impact the surrounding neighborhood. He said he hopes that Crane doesn’t ultimately build that high. And regardless, he said, Forest Grove should revisit its building codes to ensure future projects conform with residents’ expectations.

“Perhaps the community should look at any areas of concern that are zoned as light industrial and see if they should still be receiving the same zoning standards today,” Tritz said. “That’s one thing that could potentially be a lesson.”

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