Oregon freezes state land for data centers until 2027

Oregon’s state government will not approve new data center projects on public land until July 1, 2027, unless Governor Tina Kotek lifts the pause sooner, Data Center Dynamics reported on September 9. The governor’s directive halts unapproved requests for easements, rights-of-way, leases, rentals, land-use permits, and sales or transfers of state-owned property tied to data center projects while the state works to understand the demands such projects place on water, energy, infrastructure, and natural resources.

The freeze stops short of a statewide moratorium because Oregon lacks the authority to impose one, but its reach extends well beyond the acres a data center would sit on: the transaction list includes easements and rights-of-way, the instruments by which power lines and fiber cross public ground. A project that needs to thread a connection through state-owned land is caught in the same pause as one that planned to build directly on it.

The order is the latest turn in a widening political pattern across Oregon: in August, Kotek blocked the sale of 32 acres at the Mill Creek Corporate Center in southeast Salem for a Verrus data center proposal; Hillsboro placed a 120-day moratorium on data center projects at the end of July; and the Oregon House passed a bill in June 2025 intended to make data centers and cryptocurrency operations pay a fair share of the cost of new power plants and transmission lines. The targets differ—local approvals, grid costs, state land—but the underlying move is the same: Oregon is trying to measure a buildout that has been moving faster than its rules.

The measurement effort now has a deadline: the Oregon Data Center Advisory Committee, which Kotek convened in January, is expected to produce policy recommendations by the end of 2026 to inform future legislation. Because the land freeze runs about six months past that, the committee’s report will land before the state has to decide whether to reopen its property, leaving a developer holding a state-land project effectively waiting on that report rather than the calendar.

The freeze also suspends negotiation—when a state owns land, it can extract concessions such as jobs, infrastructure contributions, or revenue in exchange for a lease or sale, and Oregon has now taken that bargaining chip off the table for two years. No state official can promise a developer a path to approval, and no developer can offer the state something that changes the timeline. That dynamic pushes any state-land deal into the next legislative cycle and gives the advisory committee’s recommendations, rather than individual negotiations, the power to set the price of entry.

Data center developers do not lack capital; they lack sites where approval is predictable, and Oregon has made that shortage explicit by removing state-owned land from the pool and adding a layer of uncertainty to any project that needs a public right-of-way. Private-land applications will keep moving, subject to city moratoriums like Hillsboro’s, but the projects most exposed are the ones that cannot avoid public ground—transmission corridors, road crossings, or parcels the state owns outright.

The questions Oregon is asking are the questions every dense data center market will eventually face—who absorbs the water and power costs, and who pays for the grid upgrades—and Oregon is unusual in using its property to force those questions before the next round of approvals. That is a legitimate exercise of public ownership, and also political risk of a kind underwriting models rarely capture, because two years is a long time in an industry where power forecasts and leasing commitments move quarterly. If the committee returns with rules developers can live with, the pause will look like a cheap price for a stable rulebook; if the conditions tighten, Oregon has shown every future applicant that public land comes with a political premium.

The practical judgment is that state land now behaves like a political question rather than a permitting one. The industry’s ability to route around Oregon’s freeze will show up in where its permit applications land. Private ground, where the governor’s order does not reach, is the test of whether the pause changes the buildout or only its geography.