The recent decision on whether to impose a one-year freeze on data centre development in Hamilton was extremely challenging. I appreciate the significant public interest this issue generated and recognize that residents hold differing views.

This file has been a journey of discovery for me. As I read more and met with residents and experts, I learned that not all data centres are alike and that Hamilton has been home to many data centres for years, serving public, institutional, and private needs. I also came to share many of the concerns raised regarding large-scale, hyperscale data centres.

At the same time, I learned that Canada's regulatory framework for data centres is still emerging and requires careful, scientifically informed deliberation and public review. This differs significantly from the United States, where regulation remains comparatively limited.

Some residents expressed concerns about artificial intelligence itself. Municipalities, however, have no authority over the field of artificial intelligence and no legal authority to prohibit data centres outright. 

Other residents raised important questions about the environmental impacts of data centre operations, including waste heat, air quality, water consumption and discharge, energy demand, noise, and vibration.

In responding to residents, I initially indicated that I would support an Interim Control By-law (ICBL), believing that a temporary pause could give the City time to study these operations and determine how land-use planning tools could be used to regulate them.

After receiving additional information from City staff, further reading, including peer-reviewed research, government guidelines – particularly in Europe and Australia, non-profit organization best practices, and legal interpretation of current and forthcoming legislation, I came to an opinion that differed from that I held earlier; as a result, I voted against implementing an ICBL. I believe I owe residents an explanation for why my position changed.

In short, jurisdiction was a major factor – municipalities do not have ultimate authority over many of the concerns that have been identified. For example, energy use and distribution are a provincial responsibility. Air quality regulations are also provincial, and water quality standards and any usage of water from Hamilton Harbour rest with the federal, provincial, and conservation agencies.

Municipalities are not constitutionally independent governments in Canada. Section 92 of the Constitution Act, 1867 gives Provinces authority over “Municipal Institutions in the Province,” which is why Ontario can create, limit, expand, or override municipal planning powers. A play we have seen frequently in the last few years.

In addition, the potential opportunities for data centre investment on brownfield lands that could support Hamilton's continuing efforts to foster research and innovation, redevelop dormant industrial properties, and grow the City's tax base, thereby helping to ease the overall property tax burden on residents, played a role.  

Federal and provincial governments are beginning to recognize the need for a comprehensive regulatory framework to address larger data centre operations. However, this work remains in its infancy, as Canada has lagged behind other countries in large-scale data centre development.  

For example, through Bill 40, the Province of Ontario is proposing to review projects requiring more than 50 megawatts of electricity to ensure the Province's energy grid can continue to serve residential, commercial, institutional, and future users. Ultimately, Ontario retains authority over energy approvals.

At present, data centres are classified as an industrial use under Hamilton's Zoning By-law and can only locate on lands zoned for industrial purposes, including brownfields. Brownfields are former industrial sites that may be contaminated from previous uses and are often expensive to remediate. As a result, many remain dormant and generate limited property tax revenue. Importantly, these zoning permissions predate the emergence of hyperscale data centres.

While the City has not received any data centre applications, former Stelco brownfield lands have recently been identified by interested parties as potential locations because of their site conditions and existing zoning permissions.

At a public meeting this month, Council learned of a proposal from the Digital Research Alliance of Canada (DRAC), a national not-for-profit organization funded by the Government of Canada that provides advanced computing services to universities, research institutions, and some private enterprises.

A nationwide competitive process is currently underway. DRAC has applied for approximately $890 million in federal funding for a small-scale research data centre on the same brownfield lands.

DRAC representatives advised Council that the proposed facility would utilize a closed-loop cooling system, requiring neither municipal water nor fan-based cooling. They further indicated that waste heat generated by the facility could potentially be redirected underground to heat nearby buildings.

It is my opinion that implementing an ICBL at this time may have put this highly competitive process at risk, potentially resulting in the loss of investment and an opportunity to support advanced scientific research and innovation in our city.

To be clear, I have never met with or spoken to the owners of the former Stelco lands. I heard directly from DRAC representatives for the first time at this month's public Council meeting.

Should any data centre proposal proceed, it would still be required to undergo the City's site plan approval process. This process requires applicants to submit detailed planning and technical studies, including servicing reports, stormwater management plans, grading and drainage information, noise and vibration studies, and site and building plans. The process ultimately results in a legally binding agreement between the City and the applicant.

Any matters related to energy approvals, water takings, or other environmental approvals would continue to be reviewed by the appropriate provincial or federal authorities.

Residents have also raised questions about McMaster University's due diligence regarding a potential data centre at 44 Frid Street, the former Hamilton Spectator property. Legal counsel has advised Council that a university-led initiative may be exempt from Ontario's Planning Act and, therefore, from an ICBL, as universities were recently granted expanded planning authorities under Bill 185.

Municipalities do have the authority to enact an Interim Control By-law (ICBL), although this planning tool is used infrequently. Recently, however, the Province amended the Planning Act to allow property owners to appeal an ICBL during its first year of implementation. Prior to 2023, appeals were generally restricted until the second year and only if a municipal council chose to extend the development freeze.

This change is part of a broader, consistent trend in which the Province is limiting municipal authority in land-use planning. We have already seen this narrowing of municipal discretion regarding residential development through efforts to "build more homes faster." More recently, the Province has identified data centre development as an economic priority.

As a result, recent and anticipated legislative changes are narrowing the scope of studies municipalities may require and limiting how local governments can review and assess data centre applications. This evolving legislative environment also informed my vote.

To that end, City staff remain tasked with delivering a report in 2027 that could inform Hamilton's future land-use framework for data centres. This work is new and complex. It will enable and encourage public engagement. 

Any future municipal approach to data centres must be grounded in planning tools and studies that are legally permissible, evidence-based, and capable of withstanding appeal or legal challenge. Just as importantly, any actions undertaken by the City should have a reasonable likelihood of influencing future data centre development in Hamilton.

As data centres continue to be proposed across Canada, a growing number of residents and municipalities are calling on provincial and federal governments to establish a comprehensive and standardized regulatory framework. The City of Hamilton must join in these requests.

In my research, I found that municipalities in Australia are making similar requests to their state and national governments, as local communities feel overlooked. The lack of a regulatory framework in Australia is creating challenges. Canada can learn from those challenges, as it can learn from the European Union's best practices. Ironically, Canada's relatively late entry into large-scale commercial data centre development may prove advantageous, providing governments with an opportunity to learn from other jurisdictions' experiences and to develop a modern regulatory framework that appropriately balances economic opportunity with environmental protection and community interests.

I apologize for the length of this letter, but I wanted to do my best to explain my reasoning so that residents can hold me accountable for my decision.