Sullivan County approves new PMD3 zoning for data centers, keeps moratorium in place after public concern

Sullivan County commissioners voted 18–0 on June 11 to adopt a new PMD3 zoning text amendment intended to regulate data centers and other high-intensity energy uses, including battery energy storage systems, but the commission emphasized the county’s one-year moratorium remains in effect while staff continues study.

The amendment, described by county planning staff as a “plan manufacturing district intended for data centers and high-intensity energy uses,” received positive recommendations from three regional planning commissions earlier this year. Commissioners also approved a separate rezoning (case one) for property at 118 Anko Place in Kingsport.

The most contested points were siting and potential effects on utility rates. Allison Kathy, a retired attorney and Kingsport-area resident, urged commissioners to keep the moratorium and gather more information before allowing such facilities, saying the public needs more transparency and study. “I would just like to encourage you to keep this moratorium in place,” Kathy said, arguing recently passed state legislation contains loopholes and will not reliably protect local ratepayers.

Staff and commissioners said the text amendment includes several safeguards. Planning staff said the ordinance requires a developer-paid utility/impact study that must show how much energy and water the project will demand and that residential power rates would not increase as a result. Mr. May, the county planner who presented the amendment, said the PMD3 district is intended to keep such facilities in interior locations of established industrial parks or zones that will not upset adjacent residential properties, and noted that the draft allows battery energy storage systems to be standalone uses within the district.

Commissioners debated whether to send the draft back to planning for more work or to approve it and direct staff to return with targeted edits. Commissioner Stum moved to send the amendment back to planning but later withdrew the motion; the commission instead voted to approve the amendment that night. The clerk recorded 18 yes votes and six absences. The county attorney noted that passing the text amendment while the moratorium remains in place could invite legal arguments that the moratorium no longer serves a purpose, and advised the commission to continue active review and documentation to reduce legal exposure.

Supporters of the zoning text said the measure is a precautionary step to put guardrails in place before outside developers buy large tracts of land. Several commissioners said the ordinance can be amended later if new information emerges. Commissioner Mark reported that a utility representative had assured him the cost burden would fall on the user and not be passed to residential customers, and Commissioner Vanover stressed the requirement that developers demonstrate no upward pressure on residential rates as part of the plan review.

The commission also approved a rezoning request for Greg Raleigh to change a parcel at 118 Anko Place from R1/R3 to TBDS SCC; planning staff said the Kingsport regional planning commission and staff recommended approval and that there was no neighborhood opposition.

Next steps: staff will continue to monitor developments and return to the commission with any recommended text amendments or clarifications. Planning staff also introduced new community planner Lori Patt at the meeting.