Olive Branch Adopts Data Center Restrictions as Memphis Debates a Pause

The Olive Branch Board of Mayor and Aldermen unanimously adopted data center restrictions August 18, effective immediately: conditional-use zoning, 2,000-foot hyperscale setbacks, overnight noise caps, tiered water limits, closed-loop cooling, and developer-funded decommissioning.

MEMPHIS, Tenn. - While Memphis debates a 12-month pause to write data center rules, a suburb one county line away just wrote them, adopted them unanimously, and put them into effect the same day.

The Olive Branch Board of Mayor and Aldermen on Tuesday, August 18, 2026 unanimously approved an ordinance restricting future data center development, with Mayor Ken Adams moving for immediate implementation rather than waiting a month under standard adoption procedures, the Commercial Appeal reported Wednesday, August 19, 2026 (Neil Strebig). The Daily Memphian also covered the adoption.

The ordinance reclassifies data centers from permitted uses to conditional uses in the city's M-1 and M-2 industrial zones, meaning each project now requires case-by-case approval. For Tier 3 hyperscale facilities, it imposes 2,000-foot setbacks from schools, residential areas, parks, and roads. It caps noise from hyperscale facilities at 45 decibels between 9 p.m. and 6 a.m. and 65 decibels at any time, measured at the facility boundary. It creates a three-tier classification by water use, topping out at facilities exceeding 500,000 gallons daily or one million gallons at peak. And it mandates closed-loop cooling systems, restricts generator power use between 2 and 5 p.m., requires the highest emission standards, and makes developers cover full decommissioning costs, per the Commercial Appeal.

"We would not have a leg to stand on," planning and development director Venard Asongayi said of the city's previous code, per the report. Planning Commission Chairman Patt Door framed the rules as control rather than invitation: "Creating regulations for data centers doesn't open the door for them, it gives the city a better way to control that door." Alderman Dale Dickerson acknowledged the regional context: "Different levels to it. I know Southaven has been a nightmare, but not all (data centers) are the same."

The regional context is SpaceXAI (formerly xAI). The coverage names the company's Colossus and Colossus 2 operations and a company power plant at 2875 Stanton Road in Southaven, which faces legal challenges and powers Colossus 2 across the state line in Memphis. Neighboring Southaven agreed August 18 to a land swap with SpaceXAI subsidiaries carrying $40 million for police and fire training facilities, and Memphis's own data center moratorium passed committee and first reading the same day.

The national arc runs the same direction. The 901 Report reported in August that Texas froze data center approvals until companies disclose their water use, tax breaks, and ownership. Olive Branch's version is narrower and local, and it is already law.

For Memphis, the ordinance is less a comparison than a checklist. Every standard Olive Branch adopted, siting distance, noise ceiling, water tiers, cooling technology, decommissioning liability, is an answer to a question Memphis's proposed 12-month moratorium exists to study.

Why It Matters for Memphis

Memphis's moratorium debate turns on whether a year is too long to write data center rules. Olive Branch just demonstrated what a finished rulebook looks like: specific, measurable standards adopted unanimously and effective immediately. The Memphis study period now has a concrete local template to beat, or to beat back.

The Transparency Gap

Who holds the authority here. Olive Branch's Board of Mayor and Aldermen adopted the ordinance and its planning commission recommended it, which is the whole chain. That is the point of the comparison: a municipal legislative body wrote enforceable numbers into its zoning code in one vote. In Memphis, the same category of decision splits across the City Council, which is considering only a pause, the Land Use Control Board, which handles siting approvals, and the administration, which issues permits. Neither city's arrangement is unusual; the difference is that one of them has finished.

What has not been disclosed. The adopted ordinance text has not been posted publicly in an accessible form, so every numeric standard here rests on one outlet's account of it. Whether the rules reach applications already filed has not been stated. Which existing Olive Branch facilities are grandfathered has not been identified. The lower-tier water thresholds were garbled in the available reporting and are deliberately omitted here. And no analysis has been published showing whether any current site would fail the new standards.

Why the gap matters, and what we are requesting. Olive Branch adopted enforceable numbers, which is more than Memphis has, but numbers only bind if the text says who they apply to and when. A rulebook that exempts everything already in the pipeline reads as strict and functions as permission. Memphis is about to spend up to a year writing its own version and should be reading the actual document, not a summary of it. The 901 Report is requesting the adopted Olive Branch ordinance and its recorded effective date, the planning commission's recommendation and staff report, the grandfathering and pending-application provisions, and the city's list of existing data center sites measured against the new standards. We will report what those records show.

Your city. Your money. Your receipts.

Olive Branch Wrote the Rules Memphis Is Pausing to Write

Why It Matters for Memphis

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