TO: City Council
THRU: Jodi Phelps - Assistant City Manager
Dr. Gerald Newton, AICP - Development Services Director
FROM: Craig Harmon, CZO - Senior Planner
Demetrios Moutos, AICP - Planner II
DATE: April 13, 2026
RE:Title
TA26-01: Proposed Amendments to the Unified Development Ordinance (UDO) Regarding Telecommunications and Data Storage Facilities (Data Centers)
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COUNCIL DISTRICT(S):
Council District(s)
All
b
Relationship To Strategic Plan:
Primary Alignment: Goal II focuses on maintaining a responsive city government that supports a diverse and viable economy.
The FY2025 Strategic Plan establishes Goal II, which aims to maintain a responsive city government that supports a diverse and viable economy. The objectives are to (2.1) diversify the tax base, (2.2) invest in community places, (2.3) leverage partnerships for job creation and retention, and (2.4) sustain a strong development climate.
Objective 2.1 - Diverse City Tax Base
• TA26-01 establishes a predictable entitlement framework for the “Telecommunications and Data Storage Facility” as an industrial service use.
• TA26-01 designates principal-use forms for employment and industrial districts (BP-4, LI, HI).
• The Use Table excludes unlisted districts, which reduces classification drift and enhances administrative efficiency.
Objective 2.3 - Leverage Partnerships for Job Creation and Retention
• Goal II identifies the Public Works Commission as a key partner.
• TA26-01 mandates that site plans include documentation of utility coordination with the Public Works Commission or other relevant providers.
Objective 2.4 - Sustain a Favorable Development Climate
• TA26-01 clarifies pathways within the Use Table to promote predictable development outcomes.
• It separates “Principal Use, with Energy Center” for a distinct special review process.
• Baseline principal use is permitted by-right in BP-4, LI, and HI districts.
• The Energy Center variant is allowed exclusively through a Special Use Permit.
• Conditions and mitigation measures are reserved for higher-impact facility models.
Objective 2.2 - Invest in Community Places
• TA26-01 is not intended as a place-making or revitalization initiative.
• TA26-01 restricts data centers to employment and industrial zones.
• Performance standards are applied to limit off-site impacts and protect community quality of life.
Secondary Alignment (Goals I, III, IV, V, VI)
• Goal III: TA26-01 enhances growth management and enforcement by requiring codified submittals and enabling measurable compliance.
• Goal IV: TA26-01 improves airport compatibility by mandating earlier FAA notification, height disclosure, and adherence to key standards for overlay development.
• Goal V: TA26-01 minimizes interpretive disputes by shifting compliance to objective, verifiable standards and post-construction verification.
• Goal VI: TA26-01 increases transparency and customer service by establishing a 24-hour on-site complaint contact.
• Goal I: TA26-01 addresses airport-overlay gaps to prevent late-stage aviation risks.
Executive Summary:
TA26-01 addresses a gap in the Unified Development Ordinance by establishing a clear and enforceable land-use category for data centers. Currently, the absence of a specific definition in the UDO requires staff to classify data centers on a case-by-case basis, resulting in inconsistent reviews, applicant uncertainty, and diminished long-term enforcement. The proposed amendment resolves these issues by defining the use, providing a clear approval process, and setting measurable standards for off-site impacts likely to affect surrounding properties, including equipment yards, generator testing, noise, utility demand, and on-site power generation. Additionally, the amendment distinguishes between full-scale data centers and smaller, incidental server rooms to ensure that regulations are appropriately targeted.
The proposal was developed through a cross-departmental review process involving Planning, Zoning, the Airport, PWC, the Fire Marshal, Development Services, Public Services, IT, FCEDC, and the Planning Commission. Staff refined earlier drafts to enhance clarity, administrative efficiency, and enforceability, while maintaining a focus on land-use issues such as siting, compatibility, screening, documentation, and verification. The amendment also updates related standards for parking, loading, and airport compatibility to reflect the operational realities of these facilities. Research from other communities, particularly in Northern Virginia and North Carolina, indicates that treating data centers as generic industrial uses often fails to address key concerns, including noise, extensive exterior equipment areas, and utility coordination. TA26-01 incorporates these lessons by adopting a more precise and predictable regulatory approach for Fayetteville.
The City Council received background information on data centers as a land use and reviewed the planning process timeline during the April 6, 2026, work session. The Council reached consensus to have the ordinance package presented at a subsequent meeting, at which time they will determine the preferred course of action for staff.
Background:
Purpose and Regulatory Gap
TA26-01 addresses a gap in the Unified Development Ordinance (UDO), which currently lacks a definition for “data center” as a distinct and enforceable land use. This absence requires staff to classify data centers on a case-by-case basis, resulting in inconsistent entitlements, ambiguous review standards, and limited post-occupancy enforcement. The proposed amendments define the use, establish a transparent entitlement process, and introduce measurable standards for common off-site impacts, including equipment yards, generator testing noise and timing, utility demand, and on-site power generation.
Process and Interdepartmental Evaluation
The City conducted a structured, cross-departmental review to develop TA26-01. A working group composed of representatives from Planning, Zoning, Airport, PWC Electric, Fire Marshal, Development Services, Public Services, IT, FCEDC, and the Planning Commission evaluated policy direction and implementation. The group:
• Confirmed the use of an entitlement approach to address anticipated impacts;
• Defined baseline expectations for coordination among utility providers; and
• Established a consistent methodology for addressing campus scale, project phasing, aggregation, and impact-based triggers.
Development and Revision Process
The initial five-part ordinance draft was presented to the Planning Commission in October 20254 and served as the baseline for subsequent refinement. In January 2026, the working group and department reviewers provided feedback regarding implementation and enforceability. The draft was then revised to enhance clarity, streamline administration, and strengthen long-term enforceability prior to submission to Council.
Scope and Policy Framework
The working group emphasized the importance of scope discipline. Data centers encompass a spectrum from small installations and adaptive reuse projects to hyperscale campuses. TA26-01 applies differentiated regulatory intensity based on facility type. The amendments:
• Differentiate incidental or internal IT rooms from primary data center functions; and
• Identify facility components that impact adjacent properties and necessitate enforcement, such as dedicated exterior infrastructure, generator operations, and utility management practices.
This approach addresses externalities while avoiding the unintended inclusion of hospitals, offices, or similar facilities with incidental server rooms.
Entitlements and Use Classification Overview
TA26-01 aligns entitlements with operational impacts. The Use Table defines a “Telecommunications and Data Storage Facility” as either:
• A standard principal facility, or
• A principal facility that includes an Energy Center.
Staff distinguishes the Energy Center variant because on-site power generation alters operational impacts, including generator use, fuel logistics, and potential nuisances. The ordinance mandates a Special Use Permit for the Energy Center variant where permitted, allowing for site-specific compatibility conditions.
Use-Specific Standards and Implementation Procedures
The standards package was clarified to specify the following:
• The permissible locations for major equipment in proximity to residential transition zones;
• The conditions under which acoustical documentation is required and the specific information it must demonstrate;
• The procedures for incorporating and maintaining mitigation measures within approved plans; and
• The role of post-construction verification in ensuring real-world compliance beyond predictive modeling.
Calibration Updates: Parking, Loading, and Airport Compatibility
Implementation was updated based on operational experience and interdepartmental review:
• Parking and loading standards were calibrated for uses characterized by significant infrastructure requirements and low personnel density, preventing overbuilding while ensuring sufficient visitor and service capacity;
• The Airport Overlay was updated to address aviation risks within site planning and permitting processes for industrial developments, including data centers; and
• Compatibility review was advanced to earlier project phases to minimize late-stage redesigns and prevent avoidable conflicts.
Peer Community Regulatory Review
Key Regulatory Insights
Peer jurisdictions indicate that classifying data centers as generic industrial or warehouse uses does not adequately address the impacts most apparent to the public and most likely to generate complaints. These impacts include:
• Exterior infrastructure, such as cooling equipment, generator yards, substations, and switchgear;
• Operational patterns, particularly routine generator testing; and
• Utility obligations and infrastructure coordination.
Peer communities recommend explicitly naming and defining data center uses, distinguishing incidental information technology functions from principal data centers, and implementing targeted performance standards adjacent to sensitive land uses.
Northern Virginia: A High-Growth Case Study
Northern Virginia exemplifies how rapid data center expansion can exceed the capacity of existing zoning regulations.
• Fairfax County (2024) prioritizes noise compliance and the proximity of data centers to residential areas. The county mandates pre- and post-construction noise studies for by-right facilities to demonstrate adherence to local noise regulations. Additionally, it enforces separation and design standards near residential zones, including requirements for equipment screening and setbacks.
• Loudoun County (2025) now requires Special Exemption approval for data centers in multiple industrial districts that were previously designated as by-right. The county has also adopted grandfathering provisions based on application timing and established residential buffer requirements.
Comparison of North Carolina Municipal Approaches: Charlotte and Raleigh
• Charlotte identifies and defines “Telecommunications and Data Storage Facility” as a distinct land use, rather than regulating it within broader categories. The staff proposal adopts this specific terminology and introduces a detailed, component-based methodology to address enforcement challenges and the regulation of exterior equipment.
• Raleigh employs broader land use categories and relies on administrative discretion to classify unlisted uses, a strategy that is effective for smaller or infrequent proposals. In contrast, the staff selected a more explicit approach to minimize classification disputes and enhance predictability and enforceability for larger, infrastructure-intensive projects.
Policy Implications for Fayetteville
Peer experience demonstrates that TA26-01 maintains the Unified Development Ordinance (UDO) focus on siting, compatibility, and measurable impacts, including noise, equipment placement and screening, documentation, and verification. Meanwhile, staff addresses broader economic development objectives through alternative mechanisms such as utility coordination, agreements, incentives, and workforce partnerships, rather than through zoning text amendments.
Issues/Analysis:
Overview
TA26-01 addresses a structural code gap by establishing a clear definition of “data center” as an enforceable land use within the Unified Development Ordinance (UDO), thereby reducing inconsistencies in classification, entitlement, and enforcement. Ordinance 1 introduces terminology to distinguish incidental IT rooms from principal-use data centers and identifies components responsible for off-site impacts. Ordinance 2 allocates entitlements via the Use Table and guides applicants to the updated standards. Ordinances 3 through 5 establish operational, dimensional, and procedural controls to maintain a clear and enforceable regulatory framework over time.
Ordinance 1 - Add Definitions (UDO Article 30-9.D)
Issue
In the absence of clear definitions, applications are often categorized based on the “closest fit,” requiring staff to address questions on a case-by-case basis, including what constitutes a data center, what qualifies as an accessory use, and which site elements may result in neighborhood impacts. The working group noted that the term “data center” encompasses a broad spectrum of facilities, necessitating code provisions that avoid treating all proposals as hyperscale developments.
Amendment Summary
Ordinance 1 introduces essential definitions that:
• Differentiate between internal-only accessory data centers and those that include exterior plants;
• Provide a definition for “Dedicated Exterior Plant” (including cooling yards, generator yards, substations, and switchgear) to specify which components are subject to screening, setback, and noise standards;
• Define “Energy Center” to distinguish between standby generation and on-site power generation intended for regular operation;
• Define “Noise-Sensitive Land Use/Receptor” and “Adjacent” to address gaps in proximity-based standards; and
• Define “Utility Impact Statement (Data Center)” to ensure that utility impact documentation is comprehensive and consistent across all cases.
Justification
Ordinance 1 establishes clear boundaries for the regulatory package. It differentiates incidental server rooms from principal-use data centers and identifies components responsible for external impacts, including outdoor mechanical yards, generator operations, on-site power generation, and utility demands. The ordinance adopts the term “Telecommunications and Data Storage Facility” to define the intended use and explicitly excludes uses such as broadcast studios, call centers, general offices, and incidental IT rooms.
Ordinance 2 - Amend Use Table (UDO Table 30-4.A.2)
Issue
In the absence of a designated Use Table row, staff classifications may lack consistency. Such inconsistency results in uncertain entitlements and undermines enforcement.
Amendment Summary
Ordinance 2 establishes a specific Use Table entry under Industrial Services and divides the use into two principal variants:
• Telecommunications and Data Storage Facility, Principal Use: permitted by right in BP-4, LI, and HI districts; requires a Special Use Permit (SUP) in certain transition or urban districts; and is prohibited in neighborhood-scale and other specified districts.
• Telecommunications and Data Storage Facility, Principal Use, with Energy Center: permitted only by Special Use Permit (SUP) where allowed, including BP-4, LI, and HI districts.
The ordinance further specifies that if a district is not listed in the Use Table row, the use is prohibited.
Justification
This entitlement structure aligns with the anticipated impact and risk tolerance. The baseline principal use remains predictable in employment and industrial districts. The code mandates discretionary review for locations with heightened compatibility concerns or where the Energy Center model is present, thereby preventing accidental permissibility due to omission.
Ordinance 3 - Add Use-Specific Standards (UDO Section 30-4.C.5)
Issue
The Use Table specifies permissible locations and required entitlements for uses; however, it does not address key concerns such as equipment placement, proximity to residences, property line noise, generator testing schedules, or post-occupancy verification.
Amendment Summary
Ordinance 3 establishes enforceable standards for both principal-use variants, including the following provisions:
A. Scope and Proximity
• These standards are applicable to all principal facilities, including phased campuses, but do not apply to standard accessory server rooms that are located within another permitted use.
• Residential adjacency refers to properties that abut either a residential base district or a property with a lawfully established residential use.
B. Separation and Buffer Requirements at Residential Boundaries
• Generators and mechanical yards serving principal uses must be sited a minimum of 150 feet from any shared residential lot line or residential use, and must provide a Type D perimeter buffer.
• For Energy Center facilities, the minimum required separation for equipment is 200 feet, while the Type D perimeter buffer remains mandatory.
C. Equipment Placement, Screening, and Service Orientation
• Major ground-mounted service equipment shall be located at the side or rear of the building. Fuel tanks shall not be placed between the building and the public street.
• Screening shall comply with Unified Development Ordinance (UDO) standards. Chain-link fencing with slats does not constitute acceptable screening.
• Loading and service openings shall not face residential lots where the site abuts residential areas.
• Opaque enclosures are required for generators and mechanical yards located near residential districts or uses, with an eight-foot height limit unless otherwise approved.
D. Noise and Operating Hour Regulations
• The City’s “Commercial or Business” noise limits and limited audibility standards apply at or beyond the property boundary.
• Routine generator testing and maintenance is limited to Monday through Friday, 9:00 a.m. to 5:00 p.m., excluding City-observed holidays unless modified by Special Use Permit (SUP). Emergency situations are exempt.
• Outdoor amplified sound is prohibited except for emergency life-safety communications. Routine outdoor maintenance using powered equipment is restricted to the same weekday hours.
E. Technical Submittal Requirements and Post-Construction Verification Procedures
• An Acoustical Compliance Memorandum is required when specific triggers are met, including a Special Use Permit (SUP) requirement, adjacency to residential areas, location within 500 feet of residential zoning or use, or placement of equipment within 250 feet of any lot line. Site plan approval is withheld until the Administrator determines the memorandum is complete.
• The memorandum must include source mapping, manufacturer data, boundary modeling, demonstration of compliance, and mitigation measures integrated into the site plan.
• Mitigation measures must be depicted on approved plans, installed prior to issuance of a certificate of occupancy for the relevant phase, and maintained throughout the duration of the use.
• Post-construction boundary testing is required within 60 days after the commencement of continuous operations when triggers are met, or in all cases for the Energy Center variant.
F. Coordination and Complaint Response
• Documented utility coordination must be provided during site plan review, and 24-hour contact information must be posted and maintained.
Justification
Ordinance 3 transforms the concept of “compatibility” into measurable requirements based on the actual impacts experienced by neighboring properties. Additionally, it implements a proportional documentation approach, mandating triggered memoranda for baseline principal facilities and requiring an acoustical study for Energy Center projects due to their higher operational intensity.
Ordinance 4 - Add Parking & Loading Standards (UDO Article 30-5.A)
Issue
Standard parking ratios frequently result in excessive parking construction for large-floorplate, low-staffing developments. This approach leads to unnecessary impervious surfaces, increased stormwater runoff, elevated heat generation, adverse visual impacts, and inconsistent case-by-case negotiations.
Amendment Summary
Ordinance 4 establishes parking and loading standards designed to align with actual demand.
• The minimum parking requirement is one space per 1,000 square feet of accessory office or support areas, one space per employee on the largest shift, and visitor parking consisting of three spaces per site plus one per principal building, with a maximum of ten visitor spaces per site.
• The maximum parking allowance is twice the minimum requirements, unless an Alternative Parking Plan is approved by staff.
• Loading requirements specify one space per loading dock.
Justification
The ordinance optimizes parking and loading requirements for uses characterized by substantial infrastructure and low occupancy. It maintains adequate visitor and service capacity, prevents unnecessary paving, and preserves flexibility through the Alternative Parking Plan process.
Ordinance 5 - Amendment to Airport Overlay District (UDO Section 30-3.H.6)
Issue
The Airport Overlay effectively addresses relevant hazard concerns; however, the code primarily applies these considerations during the rezoning process. Numerous industrial projects proceed via site plan or building permit pathways without rezoning, which may delay or fragment the aviation compatibility review.
Amendment Summary
Ordinance 4 incorporates key Airport Protection Overlay (APO) considerations as development standards for all new projects within the overlay and enhances the early review process.
• APO structure and lighting requirements now apply to all new development within the overlay, rather than being limited to rezonings.
• FAA Form 7460-1 acknowledgement is required prior to site plan approval, while the timing for building permits remains unchanged. Responses to hazards or obstructions are addressed through either Airport Director consent or a variance process.
• Site plans must disclose the maximum height above grade for buildings and appurtenances. The ordinance also establishes specific triggers for Airport Director referral, such as the inclusion of standby generators, fuel storage of 1,320 gallons or more, plume-generating cooling systems, lighting exceeding 25 feet, or any structure or appurtenance that triggers a Part 77 notice.
• Operational hazard standards are strengthened for lighting, visibility impairment caused by smoke, steam, dust, or particulates, electromagnetic interference, and wildlife attraction.
Justification
The ordinance addresses a procedural gap by establishing airport compatibility as a standard for all locations, rather than limiting it to rezoning situations. It advances essential coordination with the Federal Aviation Administration and airports to earlier stages in the process, thereby reducing the risk of late-stage redesigns and preventable hazards.
Budget Impact:
TA26-01 serves as a regulatory measure and does not necessitate a direct capital appropriation. The additional workload will be addressed by processing SUP cases for “S” districts and “with Energy Center” proposals, reviewing required acoustical documentation, and post-construction verification, and coordinating airport overlay procedures as necessary.
Options:
1. The City Council directs staff to schedule the proposed ordinance revisions for a legislative public hearing at the __________ City Council Regular Meeting.
2. The City Council directs staff to incorporate the following modifications and to schedule the revised ordinance amendments for a legislative public hearing at the __________ City Council Regular Meeting.
3. The City Council instructs staff to organize a presentation and discussion on potential moratoria for data centers, rather than proceeding with the proposed ordinance revisions for a legislative public hearing at this stage.
4. The City Council remands the proposed amendments, in whole or in part, to the Planning Commission for further review and consideration of specified issues.
5. The City Council takes no further action on the proposed text amendments at this time.
Recommended Action::Recommended Action
It is recommended to adopt Option 1.
This package addresses a clear Unified Development Ordinance (UDO) gap, establishes predictable entitlements in appropriate districts, and introduces enforceable standards to mitigate impacts that contribute to neighborhood conflict and increased enforcement demand.
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Attachments:
1. Ordinance 1 - Add Definitions (Article 30-9.D)
2. Ordinance 2 - Amend Use Table (Article 30-4.A.2)
3. Ordinance 3 - Add Use-Specific Standards (Article 30-4.C.5)
4. Ordinance 4 - Add Parking & Loading Standards (Article 30-5.A)
5. Ordinance 5 - Amend Airport Overlay District (30-3.H.6)
6. TA26-01 PowerPoint Presentation