City of Pocatello | minutes | meeting 2026-07-16 | Regular City Council Meeting Agenda (6:00 PM)
source: https://pocatello.gov/AgendaCenter/ViewFile/Minutes/_07162026-1931

CITY OF CITY OF POCATELLO, IDAHO

CITY COUNCIL

REGULAR CITY COUNCIL MEETING
JULY 16, 2026

AGENDAITEMNO. | 1: ROLL CALL AND PLEDGE OF ALLEGIANCE

The Regular City Council meeting was called to order at 6:00 p.m. by Mayor Mark
Dahlquist. Council members present were Dakota Bates, Corey Mangum, Brent Nichols,
Hayden Paulsen, and Stacy Satterfield. Council member Ann Swanson was excused.

Mayor Dahlquist read a statement from Ann Swanson regarding her excused absence
from the meeting.

Mayor Dahlquist led the audience in the pledge of allegiance.

AGENDAITEMNO. _ 2: INVOCATION

The invocation was offered by Pastor Karl Pettit, representing First Baptist Church.
AGENDAITEMNO. _ 3: CONSENT AGENDA

Council was asked to consider the following business items:

(a) MINUTES
Waive the oral reading of the minutes and approve the minutes from the
City Council Budget Development meeting of May 7, 2026.

(b) MATERIAL CLAIMS
Approve the Material Claims for the period of July 1-15, 2026 in the amount
of $2,109,016.54.

(c) |TREASURER’S REPORT
Approve the Treasurer’s Report for May 2026 showing cash and
investments as of May 31, 2026 in the amount of $111.992,202.69.

(d) HISTORIC PRESERVATION COMMISSION ADVISORY BOARD
APPOINTMENT
Confirm the Mayor’s appointment of Justin Smith to serve as a member of
the Historic Preservation Commission. Justin’s term will begin July 17, 2026
and expire October 16, 2029.

Rich Morgan gave a presentation of the Treasurer’s Report.

A motion was made by Mr. Mangum, seconded by Mr. Paulsen, to approve the items on
the Consent Agenda. Upon roll call, those voting in favor were Mangum, Paulsen, Bates,
Nichols, and Satterfield.

AGENDAITEMNO. 4: PROCLAMATIONS

Mayor Dahlquist acknowledged the America 250 initiative, which encourages 250,000

acts of service throughout Idaho in celebration of the 250th anniversary of the United
States. The City is participating in the initiative by recognizing community members who

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JULY 16, 2026

contribute acts of service. Mayor Dahlquist recognized Steven Evans for clearing debris
from storm drains and cleaning the streets in his neighborhood, helping improve the
appearance of the area. Mr. Evans received a letter of recognition signed by Mayor
Dahlquist.

Mayor Dahlquist, proclaimed June 22 through June 28, 2026 to be Pollinator Week and
encouraged citizens to participate in events, plant native species, reduce harmful
practices, and support efforts that ensure pollinators continue to thrive for generations
to come.

Gloria Hansen, Portneuf Pollinator Partnership member, accepted the proclamation and
thanked the Mayor and Council for the recognition. She highlighted the importance of
pollinators and the need for education and habitat preservation to support them. Ms.
Hansen outlined the Partnership’s efforts to increase pollinator habitat and native
species throughout the Portneuf Valley and shared resources available on its website,
including information on native gardens and plants. She noted that the Partnership
collaborates with 13 local organizations.

AGENDAITEMNO. | 5: CALENDAR REVIEW

Mayor Dahlquist reminded Council members of the following meetings: July 20 Special
City Council Town Hall meeting at 6:00 p.m.; August 6 Clarification meeting at 5:30 p.m. .
and Regular City Council meeting at 6:00 p.m.; August 13 City Council Work Session at
9:00 a.m.

Mayor Dahlquist announced Zoo Idaho will hold a special community event to reveal the
cougar kitten’s name and introduce her to the public on July 17 at 12:00 p.m.; Southeast
Idaho Senior Games continues through July 18; Idaho International Choral Festival
continues through July 18; there will be a Red Cross Blood Drive at City Hall on July 23 at
9:00 a.m. The American Red Cross has declared an emergency blood shortage and blood
donors are urgently needed at this time. Walk-in appointments are available; July 27 and
28 is Montana Shakespeare in the Park sponsored by the Pocatello Arts Council.
“Merchant of Venice” and “Much Ado About Nothing” will be performed. Pre-show
begins at 5:00 p.m. and performances begin at 6:00 p.m. at the ISU Quad. All
performances are free to the public; Municipal Band Concerts on Sunday evenings at the
Ross Park Bandshell from 7 p.m. to 8 p.m. continue through August 2. The concerts are
free to the community; Open burn ban in Wildland-Urban Interface areas continues.

Due to the extreme heat, the following City facilities will serve as cooling shelters to those
in need. Hours are: City Hall, 7:30 a.m. - 8 p.m. Monday - Friday, and 10 a.m. - 8 p.m. on
Saturdays and Sundays; Animal Shelter, 10 a.m. - 5 p.m. Monday - Friday and Tla.m. -5
p.m. Saturday, closed Sundays. Pets are welcome too! Marshall Public Library, 10 a.m.
to 6 p.m. Monday - Thursday and 10 a.m. to 6 p.m. Friday and Saturday, closed Sunday.

AGENDAITEMNO. 6: ITEMS FROM THE AUDIENCE
Nikki Taysom, Pocatello resident, thanked Council for the pollinator proclamation. She

expressed concerns about government corruption, child safety, and moral decline, urging
a return to constitutional and moral principles.

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AGENDAITEMNO. 7: AGREEMENT AMENDMENT NO. 1APPROVAL - BIOTA
RESEARCH AND CONSULTING, INC.

Council was asked to approve Amendment No. 1 to the Agreement between the City of
Pocatello and Biota Research and Consulting Inc. for the Oxbow Project and authorize
the Mayor's signature on all pertinent documents, subject to Legal Department review.
The Amendment will increase the contract amount from $521,366.00 to $598,147.00 and
increase the project match funding from the ARPA grant for this change order to account
for a change in scope to complete revisions to the design plans.

Christine Howe, Grants Manager, presented a proposed amendment to the City’s
agreement with Biota Research and Consulting Inc. for the Oxbow Project. She explained
that the project involves restoring historic oxbow meanders and portions of the
floodplain and stream channels along the Portneuf River. Due to a new golf hole installed
at Juniper Hills Country Club, the original design was affected, requiring two additional
concepts to be developed. Ms. Howe said the amendment would allow three (3) options
to be included in the 60% design, with the most viable option selected for final design and
future construction, and would extend the contract through the end of the year.

A motion was made by Mr. Mangum, seconded by Mr. Paulsen, to approve Amendment
No. 1 to the Agreement between the City of Pocatello and Biota Research and Consulting
Inc. for the Oxbow Project and authorize the Mayor’s signature on all pertinent
documents, subject to Legal Department review. Upon roll call, those voting in favor were
Mangum, Paulsen, Bates, Nichols, and Satterfield.

AGENDAITEMNO. _ 8: REIMBURSEMENT AGREEMENT - UNION PACIFIC
RAILROAD COMPANY (UPRR):

Council was asked to approve a Reimbursement Agreement between the City and Union
Pacific Railroad Company for engineering services pertaining to the work at the location
of the Montana Subdivision which includes closure of two (2) at-grade crossings and
design of a new at-grade crossing at that location and authorize the Mayor’s signature
on all pertinent documents, subject to Legal Department review. The proposed
agreement replaces the agreement previously approved by the Council at the June 4,
2026 Regular City Council meeting.

Tom Kirkman, Public Works Director, presented the revised agreement for the proposed
at-grade railroad crossing on Phil Meador Avenue connecting to Bullock Street. He
explained that the railroad requested minor changes to the agreement after it had
previously been presented to Council, requiring the agreement to return for
consideration. In response to questions from Council, Mr. Kirkman explained that the
developer had prepaid $30,000 for the project and agreed to pay any additional costs if
the project exceeds that amount. Any unused funds would be returned to the developer.

A motion was made by Mr. Nichols, seconded by Mr. Bates, to approve a Reimbursement
Agreement between the City and Union Pacific Railroad Company for engineering
services pertaining to the work at the location of the Montana Subdivision which includes
closure of two (2) at-grade crossings and design of a new at-grade crossing at that
location and authorize the Mayor’s signature on all pertinent documents, subject to Legal

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Department review. Upon roll call, those voting in favor were Nichols, Bates, Mangum,
Paulsen, and Satterfield.

AGENDAITEMNO. 9: HEARING EXAMINER DECISION APPEAL OF
CONDITIONAL USE PERMIT (CUP) 26-003 - LEX
DEVELOPMENT:

Council was asked to consider an appeal from Lex Development, represented by Parsons
Behle & Latimer (mailing address: 350 Memorial Drive, Suite 300, Idaho Falls, ID 83402)
to affirm, reverse or modify the Hearing Examiner’s decision of Conditional Use Permit
CUP26-003, denied by the Hearing Examiner on May 19, 2026.

Mayor Dahlquist explained the City Council’s role in the pending appeal of a conditional
use permit. He explained that Council is acting in a quasi-judicial capacity and must review
the existing record, consider the issues raised on appeal, and apply applicable City
ordinances and Idaho law. He emphasized that Council cannot consider new evidence or
discuss the merits of the appeal outside the official proceedings and explained the
importance of avoiding and disclosing ex parte communications to ensure a fair and
impartial process.

Mayor Dahlquist and Council members disclosed any ex parte communications regarding
the appeal. Mayor Dahlquist reported receiving unsolicited emails and comments from
people in public but stated none would affect his judgment. Mr. Nichols reported no ex
parte communication. Mr. Bates reported receiving three (3) unsolicited phone calls and
numerous unsolicited public conversations, noting that the concerns expressed were
reflected in the existing record and would not affect his impartiality. Ms. Satterfield and
Mr. Mangum reported being approached in public but ending conversations because they
could not discuss the appeal. Mr. Paulsen reported receiving emails, phone calls, and
comments in public but stated he could remain fair and impartial.

Jennifer Flynn, Assistant Planner, summarized the appeal of the conditional use permit
for a proposed data center at 1800 River Parkway. She explained that data centers are
not a classified use under City Code and therefore require a conditional use permit. Ms.
Flynn reviewed the Hearing Examiner’s May 19, 2026, decision denying the permit based
on criteria related to public facilities and services, environmental impacts, and whether
the project would be detrimental to the public interest, health, safety, or welfare. She
noted that the Hearing Examiner identified the need for additional studies addressing
power, water, wastewater, air quality, and environmental impacts. Ms. Flynn reviewed
the property’s industrial zoning and examples of heavy industrial uses allowed under the
code. She explained that the City had sent utility notices regarding the proposed
development and received feedback from City utilities and other utility agencies and
organizations. Ms. Flynn explained that Council’s role was to consider the appeal based
on the existing record and that the item was not a public hearing. Council could affirm,
reverse, or modify the Hearing Examiner’s decision and was required to state the
reasoning for its decision. She also noted that notice of the appeal was published in the
Idaho State Journal, provided to property owners within 300 feet of the subject property,
and posted on the City’s website.

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In response to questions from Council, Jared Johnson, City Attorney, explained that one
(1) of the three (3) issues raised in the appeal was whether the City followed the proper
process by requiring a conditional use permit. He stated that, in his legal opinion, the City
followed the process required by City Code and explained that the Planning Director’s
determination and interpretation of the City Code required the conditional use permit
process for the proposed use. The Planning Director was available to answer specific
questions regarding the process.

In response to questions from Council, Ms. Flynn explained that she prepared the staff
report by reviewing the application against the seven (7) conditional use permit criteria
and determining whether the proposed use met each criterion. She noted that the report
was reviewed by other Planning Department Staff before advancing through the public
process. Ms. Flynn explained that utility notices were sent to City utilities and external
groups for input, which was then considered as part of the criteria review. Regarding
criteria D4, she explained that staff reviewed the proposed water and wastewater needs
at a preliminary level and used information from prior developments to provide that
information to the applicant. Regarding criteria Dé, Ms. Flynn explained that
environmental standards would be assessed through the building permit process and
that, based on the limited information provided, staff anticipated the project would be
required to meet those standards. She noted that staff considered the proposed use in
comparison to permitted uses because the City had not previously authorized a data
center. Regarding criterion D7, Ms. Flynn explained that staff evaluated the proposed
location, size, design, and operating characteristics based on the information provided in
the application and identified additional information that would be needed as the project
progressed.

In response to questions from Council, Mr. Johnson explained that if the Hearing
Examiner’s decision is affirmed, the applicant would be required to wait one (1) year to
reapply. He explained that the applicant could appeal the Council’s decision under the
Idaho Local Land Use Planning Act by requesting reconsideration by Council and could
then appeal to district court.

In response to questions from Council, Brent McLane, Planning and Development
Services Director, explained that when a use is not listed in the City’s use table, the
Planning Director makes a determination whether it is sufficiently similar to other uses
allowed within the zoning district. He explained that, although many characteristics of a
data center aligned with uses permitted in the industrial zone, there were questions
regarding water, wastewater, utility consumption, and other potential impacts. Mr.
McLane said he determined that a conditional use permit process was appropriate to
allow the City to evaluate the use and its potential impacts on infrastructure and the
public interest. He explained that additional information regarding utilities was received
after the determination to require a conditional use permit. Mr. McLane noted that the
applicant indicated the facility would produce limited wastewater through a closed-loop
system, but specific water and wastewater usage information had not been provided. He
also noted that studies regarding power consumption, noise, emissions, and other
potential impacts had not been provided. Mr. McLane explained that because data
centers are not identified as an allowed use in the City’s code, the conditional use permit
process was used to determine if the location met zoning requirements and what
conditions would be necessary. He noted that once a use is established, additional studies,
permits, and requirements would be addressed through the development process,

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including determining whether the City’s infrastructure could adequately serve the
facility.

In response to questions from Council, Mr. Johnson confirmed that the property is located
within a TIF district and explained that, although the TIF designation may have
implications for the property, it was not a consideration in the conditional use permit
criteria or part of the record reviewed by the Hearing Examiner. Therefore, Council
should not consider the TIF designation as part of its appeal decision.

Mayor Dahlquist observed that the City’s process was consistent with City Code, noting
that the applicant’s legal counsel had compared the proposed data center to a heavy
industrial use. He pointed out that the City’s definition of heavy industrial use involves the
manufacturing, processing, or assembling of products from raw materials, which did not
appear to apply to the proposed data center.

In response to questions from Council, Gus Schultz, Lex Development representative,
clarified his prior statement to the Hearing Examiner regarding water usage for the
proposed data center’s closed-loop system. He confirmed that approximately 300,000
gallons would be needed to initially fill the system and stated that the property is allotted
up to one million gallons of water per day.

In response to questions from Council, Tom Kirkman, Public Works Director, explained
that some of the City’s larger commercial water users consume approximately 150,000
to 300,000 gallons per day, making the proposed usage amounts relatively common for
larger users. He noted that the City had provided the applicant with available capacity
information based on the parcel size including that the site could be served with up to one
million gallons of water per day. Mr. Kirkman explained that this was the extent of the
information available and that the City did not have studies detailing the proposed
facility’s specific water consumption or evaporation rates.

In response to questions from Council, Mr. McLane confirmed that the property is located
within a TIF district but explained that state statute exempts data centers from receiving
TIF funds. Therefore, the proposed data center would not benefit from the TIF district
designation.

In response to questions from Council, Ms. Flynn explained that Idaho Power believes it
can provide the requested power without impacting service to existing customers, but
upgrades to transmission, substations, distribution, and generation resources may be
necessary. She noted that the timing and cost of those upgrades would be determined
through additional studies, after which Idaho Power would provide the applicant with
information regarding the cost and timeline for providing the requested power.

Mr. Paulsen commented that the matter appeared premature, noting that there was still
limited information regarding water usage, power, noise, infrastructure, health, and
safety.

Mr. Bates stated that his decision regarding the appeal was based solely on the facts
contained in the record, including public comments from both sides. He expressed
appreciation for engaged citizens and thanked the Shoshone-Bannock Tribes for sharing
their thoughts. He noted that policy preferences and concerns not supported by the

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record were not permissible considerations in the appeal process. After reviewing the
Hearing Examiner’s meeting and Mr. Schultz’s presentation, Mr. Bates stated that the
applicant’s presentation of the controversial and unprecedented request appeared
somewhat clumsy and casual. He stated that State law and City Code require the Council
to base its decision on the facts and record and determine whether the Hearing
Examiner’s findings and reasoning were supported. Mr. Bates stated that he believed
there were deficiencies in the Hearing Examiner’s amended findings of fact and that the
treatment of certain criteria was legally and factually incomplete. He recommended that
the Council focus its deliberation on Criteria D4, Dé, and D7, which the Hearing Examiner
found the applicant did not meet, noting that staff and the Hearing Examiner found the
applicant compliant with Criteria D1, D2, D3, and D5. He asked to discuss as a Council
these four (4) criteria. Mr. Bates discussed Criterion D4, stating that he did not believe an
air quality analysis should be required because the City does not regulate air quality,
although compliance with DEQ standards could be required. He noted that the applicant
provided site-specific water usage estimates and information regarding wastewater and
the closed-loop system. Idaho Power indicated that providing the requested power was
feasible at the preliminary stage, and staff confirmed available water, sewer, and gas
infrastructure. Mr. Bates emphasized that the conditional use permit is the first step in
the development process and that final engineered numbers would be addressed through
subsequent development processes. Based on the information provided, he stated that
he believed the applicant met Criterion D4.

Council questioned the approximately 300,000 gallons of water needed to fill the system
and wondered how often it would need to be refilled. It was noted that the application
described the initial fill as a one-time need and that the applicant testified to
approximately five percent evaporation. Council discussed whether the City could
adequately serve the use under Criterion D4.

Mr. Bates discussed Criterion D6, stating that the criterion does not require there to be
no environmental impact, but rather asks whether the proposed use would affect the
environment to a greater degree than a use already permitted by City Code. He noted
that the applicant provided comparative evidence regarding the size, scale, intensity, and
wastewater impacts of other permitted uses. Mr. Bates pointed out that heavy industrial
uses such as chemical production, large-scale machinery, and natural gas power plants
are permitted outright under City Code. He stated that, based on the evidence in the
record, including comparisons to HOKU’s polysilicon manufacturing facility, he did not
believe the proposed use could be determined to have a greater environmental impact
than other uses already permitted by City Code. Mr. Bates discussed Criterion D7, stating
that the criterion considers whether the proposed use would be detrimental to the public
interest, health, safety, or welfare based on its location, size, design, and operating
characteristics. He stated that the applicant provided sufficient evidence regarding the
location, size, and design and that the proposed use fits within the industrial zoning
designation. Mr. Bates stated that the primary question was whether the operating
characteristics of a data center met the criterion. He noted that Criteria D3 and D5,
which staff and the Hearing Examiner found compliant, addressed compatibility and
harmony with surrounding permitted uses and stated that he had difficulty finding the
proposed use noncompliant with its operating characteristics if it was compliant with
those related criteria. Mr. Bates also noted that the applicant presented the facility as a
low-impact operation and that, if approved, the City could use conditions to require

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verification and hold the applicant to those representations. He concluded that he did not
believe the record supported finding the applicant noncompliant with Criterion D7.

In response to questions from Council, Mr. Johnson explained that overturning the
Hearing Examiner’s decision would not set a precedent for allowing other data centers in
the City, as the conditional use permit application is specific to the subject site and
application. He stated that unless the City Code is amended to allow data centers which
meet specified criteria, future data center applications would be evaluated separately.

In response to questions from Council, Ms. Flynn restated the conditions included in the
staff report for CUP26-003. The conditions required compliance with all applicable City
Code standards, compliance with applicable regulations for any activity requiring a
separate development or building permit, coordination with applicable City departments
before submitting a building permit to address required site improvements, and
submission of Idaho Power’s impact analysis for power generation and construction to
the City once completed.

In response to questions from Council, Mr. Johnson explained that under City Code
17.02.130(E)(9), the Council has the authority to require additional studies as a condition
of approval. He stated that any required studies would need to be satisfied before final
approval of the conditional use permit, with the applicant having two (2) years from the
date of approval to satisfy the conditions and the possibility of a one (1)-year extension.
Mr. Johnson explained that if an environmental assessment or other study were required
as a condition of approval, the applicant could proceed with the studies but would do so
at its own risk because final approval would not occur until the condition was satisfied. He
said the Council could either delegate to staff the authority to determine whether the
conditions had been met or require the applicant to return to the Council for approval.
Mr. Johnson noted that the typical practice is to allow staff to make that determination,
particularly for studies based on engineering, although the Council could choose a
different process given the circumstances.

Mr. Paulsen stated that, regarding Criterion D7, estimates provided by the applicant do
not establish that the proposed use would not be detrimental to the public interest, health,
safety, or welfare. He questioned the accuracy of the applicant’s estimated water usage,
noting that 350,000 gallons with a 5% evaporation rate seemed unusually low and did not
demonstrate that the use would not be detrimental to the City and its residents.

In response to questions from Council, Mr. Schultz explained that the 350,000 galions
would be a one-time fill for the closed-loop cooling system, which would then be
maintained rather than drained and refilled. He said the system would be tested monthly
and maintained with the appropriate cooling-system solution, with water usage expected
to be relatively low. Mr. Schultz stated that his estimates were based on information from
professionals who design these types of systems and that, if approved, the final
specifications would be provided to staff and verified through engineering to ensure
compliance with applicable City and State requirements. In response to questions about
whether a specific company was committed to the project, Mr. Schultz stated that he had
multiple potential companies interested and confirmed that he had a signed letter of
intent, although the companies were not present at the meeting. Mr. Schultz explained
that the proposed seven buildings would be developed as a business park, incorporating
some of the existing buildings on the property. He said detailed elevations and designs

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had not yet been developed because the project was still in the conditional use permit
stage. Mr. Schultz stated that, from an aesthetic standpoint, the buildings would resemble
typical industrial or business park buildings, with exterior equipment such as coolers, and
would not appear significantly different from other buildings in the area.

Mr. Mangum stated that some aspects of the proposal seemed speculative and that there
were many unknowns, while also acknowledging the community’s longstanding desire to
see the site put to productive use. He noted concerns he had heard regarding the
potential impacts to land, air, water, and power consumption, while also recognizing that
the FBI operates a data center nearby. He agreed with Council Member Bates regarding
the value of the community’s engagement and passion and said he would like to hear from
other Council members as deliberation continued.

Mr. Nichols stated that he believed the Hearing Examiner met the requirements of the
conditional use process. He acknowledged that the applicant provided some general
information about data centers but noted that several important, specific questions
remained unanswered.

Mr. Bates stated that this was a land use decision, not a final design or engineering
approval, and that the primary question was whether the proposed use fit within City
Code, which City staff had generally determined it did. He expressed concern that
affirming the Hearing Examiner’s decision could lead to further appeals and judicial
review and potentially expose the City to additional costs. He stated that, in his opinion,
the best path forward was to reverse the decision with strict conditions requiring the
applicant to comply with the representations and estimates provided and to complete an
environmental study before any vertical construction. He also noted that concerns raised
by the public regarding noise, vibration, and lighting are not fully addressed in City Code, °
including the lack of a specific decibel standard at the property line. Council Member
Bates concluded that, based on the criteria established in the code, he believed the
applicant had met the requirements and that reasonable but strict conditions could
address the remaining concerns.

In response to questions from Council, Mr. Johnson explained that any conditions placed
on the conditional use permit would run with the land and would therefore apply to any
subsequent applicant using the property. He stated that the conditional use permit would
be recorded with Bannock County and attached to the parcel.

Ms. Satterfield expressed appreciation to the Council and staff for their time and effort
on the matter, noting the importance of getting the decision right for the community. She
said the application contained a significant amount of information, but much of it
remained vague, making it difficult to make a fully informed decision. Ms. Satterfield said
she was not opposed to the data center but wanted more information and agreed with
Mr. Bates that the City Code was vague in this area.

Mr. Paulsen expressed concern about the City’s ability to monitor and enforce conditions,
citing the ongoing difficulty to enforce electronic billboard regulations. He questioned
how the City would enforce conditions such as water use and noise restrictions and what
recourse the City would have if the facility were built and repeatedly violated those
conditions.

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In response to questions from Council, Mr. Johnson explained that conditions tied to the
permitting and building process can be enforced by withholding a certificate of
occupancy or other approval until the conditions are met. He noted that ongoing
conditions are more difficult to enforce but would constitute a contractual obligation
between the City and property owner, with violations subject to civil remedies.

In response to questions from Council, Mr. McLane said ongoing conditions could be
monitored through periodic inspections, similar to existing site requirements such as
landscaping and stormwater maintenance. He noted that a regular inspection schedule
could be established, but the City would be responsible for enforcement.

In response to questions from Council, Mr. Johnson explained that if a court found the
criteria were applied incorrectly, it would likely remand the matter to the City with
instructions, and the ability to impose additional conditions would depend on the court
order. He said the Council could amend the City Code and waive the 12-month
requirement, but any future application would be subject to the Code in effect when it was
submitted. He added that changing the City Code would not be considered punitive,
provided the changes were constitutional and enforceable.

Mr. Bates said he saw two potential paths for the Council: reverse the Hearing Examiner’s
decision with conditions or affirm the decision while modifying the timeframe for
reapplication. He noted that Mr. Schultz likely had additional detailed information he
could provide but had not been able to present new evidence during the appeal process.

Mr. Paulsen said he leaned toward affirming the Hearing Examiner’s decision and using
the time before any future application is received to address changes to City Code which
establish appropriate regulations for future data centers.

Mayor Dahlquist said he believed the City needed time to revise the City Code to better
address data centers and establish clear regulations before considering future
applications.

In response to questions from Council, Mr. McLane said the City Code had been modified
extensively over the years, but its original basis was dated in the 1990s. He explained that
the City is working toward a complete Code rewrite to modernize it. He confirmed that
Al data centers are not specifically addressed in the current City Code.

A motion was made by Mr. Nichols, seconded by Mr. Paulsen, to affirm the Hearing
Examiner’s decision of Conditional Use Permit CUP26-003, denied by the Hearing
Examiner on May 19, 2026, as the Hearing Examiner met the requirements of the
conditional use permit process regarding an appeal from Lex Development, represented
by Parsons Behle & Latimer.

Council members discussed whether to modify the 12-month reapplication timeframe,
with some members expressing interest in allowing additional time to review and
potentially revise the City Code. The Council ultimately agreed to leave the motion as-is
as the 12-month timeframe is established by ordinance.

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In response to questions from Council, Mr. McLane said he estimated the broader Title 17
rewrite could take approximately 18 months and that addressing data centers specifically
could take approximately 8 to 12 months.

Mr. Bates stated that he remained concerned the applicant could seek judicial review and
that the City could lose the opportunity to impose conditions on the development if a court
ruled in the applicant’s favor. He noted the applicable appeal and judicial review
timeframes and said he was voting against the motion due to concerns about the
potential for litigation and costs to taxpayers.

Ms. Satterfield expressed concern that judicial review could take the matter out of the
Council’s hands and leave the decision to a judge. She said she would vote in favor of the

motion but acknowledged that the outcome of any potential judicial review would be
uncertain.

Mr. Mangum said he concurred with Mr. Bates’s concerns regarding judicial review,
noting that the matter falls within the Council’s purview and that the Council should also
consider the desires of the community.

Mr. Nichols’ motion was voted upon at this time. Upon roll call, those voting in favor were
Nichols, Paulsen, Mangum, and Satterfield. Bates voted in opposition. The motion passed.

Mayor Dahlquist thanked the Council for its participation and efforts, acknowledging
that the process had been difficult and involved significant community participation and
extensive study.

AGENDAITEMNO. 10: ADJOURN

There being no further business, Mayor Dahlquist adjourned the meeting at 8:18 p.m.

APPROVED BY:

ponte el

MARK DAHLQUIST, MA

ATTESTED BY:

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PREPARED BY:

AUBRIANA T. RESENDES, DEPUTY CITY CLERK