Panhandle Counties Race to Regulate AI Data Centers Before Developers Arrive
AI data center proposals are triggering a wave of preemptive restrictions across the Florida Panhandle, with Jackson, Walton, and Bay counties all moving to block or pause development before a single formal application has been filed.
Jackson County was the first to act. On May 26, the Board of County Commissioners voted unanimously to move forward with a proposed one-year temporary moratorium on AI data center development, according to an official county press release. The decision came after a packed meeting where residents from Jackson and neighboring counties voiced concerns about water consumption, electricity demand, noise, environmental damage, and the potential loss of rural character.
The moratorium still requires two public hearings before final adoption. The first hearing is scheduled for June 9, 2026, at 9:00 a.m. at the Jackson County Commission Board Room. The pause is designed to give the county time to research the issue, review new state legislation, and develop local regulations.
The Spark: A Mystery Proposal Near Econfina
The urgency in Jackson County stems from a specific proposal. County Administrator Jim Dean told commissioners that a company approached the county about developing property along Highway 231 near the Bay County line. The project was initially presented as a solar farm and battery storage facility, but questions from county planning staff led officials to suspect it may actually involve a large-scale AI data center.
Planning official Kim Sweazy said the lack of detail was part of what raised concerns. “We haven’t received anything specific on what exactly they’re wanting to do,” she told commissioners. The proposal references Bloom Energy technology and includes plans for energy produced by the solar facility to be used on-site.
Commission Chairman Jamey Westbrook referenced what he called “horror stories” from other states including Georgia and Mississippi, where data center developments have disrupted small communities.
Walton County Goes Further: An Outright Ban
Walton County is taking an even harder line. On May 27, commissioners voted 5-0 to instruct county attorneys to draft an outright ban on AI data centers. Commissioner Danny Glidewell made the motion: “What I am asking and making this a motion to instruct legal to bring us back at the earliest possible opportunity an ordinance prohibiting data centers in Walton County, period.”
Commissioner Dan Curry echoed the urgency: “We really need to get in front of this before we can’t get in front of it.” Curry said constituents are primarily worried about environmental impacts, especially water. “It takes a lot of water to cool these things down. What is going into the water? What are we doing with the water afterwards?”
The drafted ordinance is expected to receive its first reading at the next Walton County Commission meeting on June 9, 2026.
Bay County Considering a Moratorium
Bay County may be next. County officials said the commission is expected to consider a temporary moratorium on AI data centers at their meeting on Tuesday, June 3.
State Law Complicates Local Control
A significant obstacle looms over all these efforts: Florida’s SB 180, a 2025 state law that limits local governments from adopting new land-use regulations or development moratoriums in storm-affected areas under certain conditions. Walton County Attorney Clay Atkinson warned commissioners that the county’s authority may already be constrained.
Additionally, newly approved Florida legislation signed by Governor Ron DeSantis will require AI data centers drawing major resources from communities to help pay for the infrastructure and resources they consume, including water and electricity. That law takes effect July 1. Jackson County’s attorney advised commissioners to wait until after that date before taking any formal action, and commissioners initially voted to delay until after July 1.
Instead of a flat ban, counties may need to regulate data centers indirectly through zoning definitions, water regulations, utility constraints, and land-use categories — a legal strategy that could achieve similar results while surviving state scrutiny.
What’s at Stake
Resident concerns center on several key issues:
- Water consumption — Large AI data centers can consume up to 5 million gallons of water per day for cooling, a critical concern in a region dependent on the Floridan Aquifer System
- Electricity demand — A 2024 study found U.S. data centers already account for more than 4% of total U.S. electricity consumption
- Noise and light pollution — Continuous operations, cooling fans, and security lighting could disrupt rural communities
- Property values — Residents fear nearby homes would lose value
- Environmental strain — Fossil fuel demands and stress on fragile coastal ecosystems
Not everyone opposes data center development. Economic Development Director Darwin Gilmore told Jackson County commissioners that data centers can significantly increase local tax revenue, citing Virginia counties that reportedly reduced taxes for years because of revenue from hosting such facilities. But he acknowledged the trade-off: “It’s not jobs. It’s not job count. It is the tax base.”
The Panhandle’s data center conversation is just beginning, and the coming weeks — with public hearings in Jackson and Walton counties and a potential vote in Bay County — will shape how the region responds to an industry that has barely knocked on the door.
Originally reported by MyPanhandle (WMBB), WJHG, and Jackson County Times
