by Leslie Lytle, Messenger Staff Writer

“As you know, rural Tennessee has been invaded by various things,” said Grundy County Mayor Michael Brady addressing the Grundy County Commission on May 18, calling for a moratorium banning high-impact data processing facilities. “We have not had any data mining or anything of that nature, but doing our due diligence, I feel this is something we need to do.” The commission voted unanimously to approve the Data Mining Moratorium resolution Brady introduced, distinguishing Grundy County as only one of two counties in the state to call for a temporary moratorium on high impact data processing facilities. Metropolitan Lynchburg in Moore County enacted a moratorium in April. A Hawkins County resolution calls for a permanent ban, but the county faces a lawsuit challenging the resolution.

The Grundy County resolution reads: “A temporary moratorium is hereby imposed for a period of two (2) years from the effective date of this Resolution on the establishment, construction, erection, alteration or expansion of any data center, cryptocurrency mining facility or other high-impact data processing facility in Grundy County.”

“This moratorium is a temporary halt on any action or detrimental thing impacting water usage and things of that nature,” Brady said.

Expanding on the meaning of “high-impact data processing facility,” Brady cited the following characteristics: “extremely high energy consumption and strain on existing utility infrastructure; significant noise generation from cooling systems and backup generators affecting adjacent residential areas and general quality of life; substantial water usage for cooling purposes; potential environmental impacts, including hazardous material storage and electronic waste disposal; and land use compatibility concerns, particularly in rural or agriculturally zoned districts.”

Artificial Intelligence, especially generative AI, largely drives the demand for high-impact data centers. The financial institution Goldman Sachs projects AI workloads will make up 28 percent of the global data center market by 2027, up from 13 percent in 2025, doubling in two years.

Asked why Grundy County did not ban high-impact data centers permanently, Brady said, “We stretch into the legal limits, but it [a moratorium] can be renewed.”

Introducing the resolution, Brady made reference to Grundy County’s effort to regulate sand and rock quarries with the County Powers Act. Facing a legal challenge, Grundy County prevailed in Chancery Court and Appellate Court, but the Tennessee Supreme Court ruled against the county. “We were well within our rights. The ruling came back from the supreme court describing limits. State law does [however] give us the ability to have a moratorium. It’s for a two-year period, May 18, 2026, to May 18, 2028. We can renew the moratorium on that date.”

At the state level, several bills before the General Assembly require electric and water utilities that supply service to data centers to report usage and rates to the Tennessee Public Utilities Commission. Far more aggressive legislation under consideration (HB 1827 and SB 2053) “requires the appropriate local legislative body to approve the location for … a quarry or digital asset mining facility being located in a city or county.” Significantly, the house version of the bill was introduced by Rep. Gary Hicks, former Hawkins County commissioner who represents portions of Hawkins County — the county whose permanent ban of high-impact data centers is being challenged in federal court by the nonprofit Beacon Center on behalf of Exotic Ridge Crypto Company which planned to build a facility in Hawkins County. Hicks introduced the bill on Jan. 21, 2026. The bill applies to any proposed quarry or digital asset mining facility that will be constructed on or after July 1, 2026. The bill has been placed on the House calendar four times and the Senate calendar seven times but has yet come to the floor for a vote in either chamber. Beacon Center filed the federal lawsuit against Hawkins County March 31, 2026. For Hawkins County it is a wait-and-see game. It remains to be determined if the county ban will hold up in court and if the local-approval bill will be voted into law.

The Grundy County resolution stipulates: “This moratorium shall apply to all unincorporated areas of Grundy County.” Brady cautioned, “It [the moratorium resolution] has no authority inside the city limits of Altamont, Palmer, Tracy, and Monteagle. If you know people in those cities, you might encourage them to pass a moratorium on the same grounds.” Brady can supply interested city officials with language for a resolution.