In short
Texas has no statewide zoning agency and no state law preempting municipal zoning for AI data centers. Zoning authority rests entirely with municipalities under Texas Local Government Code Chapter 211. Counties generally cannot zone land, with only one exception Hood County. Most Texas cities treat AI data centers as industrial uses, often requiring a conditional use permit, special use permit, or planned unit development. The typical local approval timeline is 3 to 12 months. In 2025 and 2026 several cities tightened their rules, adding noise limits, setbacks from homes, and removing permission by right. The 2025 state law SB 6 gives state agencies authority over electric grid interconnection for large loads but does not change local land use control. Developers can sometimes leave a city’s development regulations by releasing land from the city’s extraterritorial jurisdiction under SB 2038. Tex. Loc. Gov’t Code ch. 42, SB 6 (2025)
Who controls land use for an AI data center in Texas?
In Texas the city where the land sits controls zoning. The state does not have a single land use agency, and no state statute overrides a city’s regulatory authority for data centers. The Texas Legislature gave municipalities exclusive zoning authority under Chapter 211 of the Local Government Code. A developer who wants to build an AI data center must follow the zoning rules of the municipality if the land is inside the city limits. Tex. Loc. Gov’t Code § 211.003(a)
Texas counties, with one narrow exception, do not have zoning power. They cannot tell a landowner what use is allowed or deny a project because they dislike it. This is covered below in the section on counties.
State agencies play a role only where electricity and the grid are involved, not land use. SB 6, passed in 2025, gives the Public Utility Commission of Texas (PUCT) and ERCOT authority to set interconnection rules for loads over 75 megawatts (MW) and to require financial security before studies begin. It does not preempt or override municipal zoning. SB 6 (2025)
So the primary gatekeeper for where an AI data center can be built is the local municipality.
The table below summarizes who controls what.
| Jurisdiction | General Zoning Authority | Relevant Powers for AI Data Centers | Limits |
|---|---|---|---|
| Municipalities (cities) | Yes, under Ch. 211 | Zone land. Require CUP, SUP, or PUD. Impose setbacks and noise rules | Must follow comprehensive plan. Public hearing. Protest vote threshold |
| Counties (except Hood) | No general zoning | Subdivision platting (Ch. 232) | Cannot deny use or impose moratoria |
| State (PUCT, ERCOT) | No land use authority | Grid interconnection for loads over 75 MW (SB 6) | Does not preempt local zoning |
How do Texas municipalities zone for AI data centers?
A city’s zoning power comes from Chapter 211. The law says a municipality may regulate building height, lot coverage, yard sizes, population density, and the location and use of buildings for business, industry, homes, or other purposes. Tex. Loc. Gov’t Code § 211.003(a) To use that power the city must have a comprehensive plan. Zoning regulations must be adopted in accordance with a comprehensive plan and must be designed to lessen congestion in the streets, secure safety from fire, panic, and other dangers, promote health and the general welfare, provide adequate light and air, prevent the overcrowding of land, avoid undue concentration of population, or facilitate the adequate provision of transportation, water, sewers, schools, parks, and other public requirements. Tex. Loc. Gov’t Code § 211.004(a)
The zoning pathway for an AI data center
AI data centers are rarely a defined use in most Texas zoning codes. They are usually treated as industrial or light industrial uses. In many cities an AI data center cannot be built just because the land is zoned industrial. The developer must get a conditional use permit (CUP), a special use permit (SUP), or go through a planned unit development (PUD). A CUP or SUP is permission to use the land in a way that is not automatically allowed in that zone. A PUD is a custom zoning district negotiated with the city.
Research from the University of Texas at Austin found that the expected zoning and land use approval timeline for a data center in Texas is 3 to 12 months, with special use permits, often obtained as part of rezoning, having an expected timeline of 2 to 6 months. COMPASS UT White Paper
Public notice and protest rights
Before a zoning change the city must hold a public hearing. Notice of the hearing must be published at least 15 days ahead. If the proposed change affects property owners within 200 feet, the city must mail them written notice at least 10 days before the hearing. If owners of at least 20% of the affected area or the adjoining area within 200 feet protest in writing, the change needs a three fourths supermajority vote of the city council or governing body. Tex. Loc. Gov’t Code § 211.0061
This supermajority requirement can block a project if enough neighbors object. A developer should assess neighbor sentiment early.
Recent municipal actions
Several Texas cities have recently updated their rules to address AI data centers.
Irving (Dallas County). In February 2025 Irving changed its code so that an AI data center is no longer allowed as of right in any district. Now it always needs a CUP. It can be a principal use only in certain districts, and the code added a 300 foot setback from any residentially zoned land and other performance rules. Irving Ordinance ORD-2025-11063
North Richland Hills (Tarrant County). In June 2025 the city created two definitions, namely a general data center over 10,000 square feet and a small scale one 10,000 square feet or less. It requires equipment to be fully enclosed unless the city manager determines enclosure is not mechanically feasible, in which case equipment must be screened and set back 100 feet from residential property, limits generator testing to daytime hours on weekdays and weekends, and requires a special use permit for small scale data centers in the C-1 commercial district. NRH Ordinance No. 3907, NRH Code § 118-633(30)
Round Rock (Williamson County). The city has approved multiple AI data center PUDs. The Skybox PUD was approved in February 2026 for a 29.69 acre site with a 250,000 square foot building, 75 MW power, mandatory closed loop cooling, and a separate electric substation. This was Round Rock’s ninth approved AI data center. Round Rock File 2025-326, Central Texas Data Center Tracker A citizen group called Protect Round Rock organized opposition.
San Angelo (Tom Green County). The city passed AI data center rules in May 2025 by a 6-0 vote, addressing noise, fencing, and building size. Separate water regulations requiring a closed loop water cooling system passed a first hearing and were scheduled for a second hearing in June. San Angelo ordinance via AOL
These examples show a clear trend. Many Texas cities are moving from allowing AI data centers as of right to requiring a discretionary permit and adding specific performance standards.
What can Texas counties do about AI data centers?
Under Chapter 231, Texas counties lack general zoning authority. Only Hood County received broad zoning power from the legislature in 1999. For the other counties, zoning is limited to specific areas near lakes, military bases, airports, and a few other designated sites. Tex. Loc. Gov’t Code ch. 231, Tex. Loc. Gov’t Code ch. 241
Counties can regulate subdivisions and plats under Chapter 232. If a developer subdivides land, the county can review the plat for streets, drainage, and utility easements. But it cannot stop the project because it does not like the use. Tex. Loc. Gov’t Code § 232.0026, Tex. Loc. Gov’t Code § 232.101(b)
Counties cannot impose development moratoria. A 2023 Texas Attorney General opinion concluded that a proposed Franklin County moratorium on commercial solar projects would likely be found invalid to the extent it relied on certain Transportation Code provisions and Health and Safety Code section 121.003. Tex. Att’y Gen. Op. AC-0003 In 2026 two state lawmakers sent a letter to the Texas Attorney General stating that counties lack authority to enact any development moratorium. Delta County FAQ
The Delta County proposal illustrates the practical effect. A 1,600 acre AI data center with on site power generation is under option contract there. Delta County has no zoning power and posted a public FAQ explaining it cannot approve or deny the project. Subdivision rules would be triggered if the land is divided. Delta County FAQ
Unincorporated land therefore offers a faster path, but not a regulation-free one. The state still may require water permits from TCEQ, and any facility over 75 MW must comply with SB 6 interconnection standards.
Deannexation as a tool
SB 2038, passed in 2023, allows property owners in a city’s ETJ to petition for deannexation. If granted, the land leaves the city’s planning and zoning control and falls under only county and state jurisdiction. A developer facing a hostile city could use this tool to shift to a county with almost no zoning oversight. This approach has not been widely tested for AI data centers yet, but it is available.
Do Texas state incentives or SB 6 override local zoning?
No. None of the state’s economic development tools preempt local land use control.
The Texas sales tax exemption for data centers, found in Tax Code Sections 151.359 (standard) and 151.3595 (large project), offers significant tax savings. A project can avoid state sales tax on qualifying equipment for 10 to 20 years. But to qualify it must meet investment and job thresholds. For the standard exemption, at least $200 million invested over five years and 20 permanent jobs at 120 percent of the county average weekly wage. For the large project exemption, $500 million, 40 jobs, 250,000 square feet, and a contract for at least 20 megawatts of transmission capacity. Tex. Tax Code § 151.359, Tex. Tax Code § 151.3595 The exemption is administered by the Texas Comptroller, not by the city. The statute does not say it supersedes local zoning. A city can deny a zoning change even if the project would qualify.
Local property tax abatements under Chapter 312 of the Tax Code are negotiated with the city or county. They are often part of an incentive package, but they do not replace zoning approval. Tex. Tax Code ch. 312
SB 6 gives PUCT and ERCOT authority over interconnection of loads over 75 MW. It requires large load customers to pay a new transmission charge, provide financial security, and show site control before interconnection studies start. It also authorizes ERCOT to disconnect large loads during emergencies. But SB 6 does not address local land use authority. SB 6 (2025) Even if ERCOT approves an interconnection, the city can still deny the zoning.
The local regulatory trend of tighter rules and growing opposition
In 2025 over 40 state level AI data center bills were enacted across the U.S., but Texas’s most notable action was not a statewide zoning bill. Instead individual cities tightened their ordinances. Central Texas alone saw a four fold increase in AI data center construction between 2023 and 2024, with 463.5 MW of potential demand under development. TRERC ERCOT’s April 2025 forecast showed peak electricity demand could more than double by 2031, largely driven by AI data centers. TRERC
This growth has spurred local anxiety. Texas Agriculture Commissioner Sid Miller warned about farmland conversion and proposed Agriculture Freedom Zones. Texas Tribune The Infrakey project in Lacy Lakeview faced 3,000 petition signatures in opposition. Texas Tribune Nationally 25 AI data center projects were cancelled in 2025, roughly four times the 2024 figure, and Texas has seen its share of contested projects. GEAA Report
Practical site selection implications
Developers should expect most Texas municipalities in growing metro areas to require some form of discretionary permit for a large AI data center. The 3 to 12 month timeline plus extra months for a SUP is real. Developers should budget for noise studies, buffer zones, and closed loop cooling systems as standard city asks. In unincorporated areas the land use path is faster, but state grid rules under SB 6 still apply for large loads. Local political opposition can also delay a project even where no legal veto exists.
The Stargate Abilene campus and large scale developments
The Stargate Abilene campus in Taylor County shows what a large AI data center looks like under Texas zoning. The 875 to 1,100 acre site with 8 buildings totaling roughly 4 million square feet was rezoned to heavy industrial with a conditional use approval. Construction started in 2024 and AI workloads went live in under a year. Oracle, Crusoe, Crusoe The project uses 360 MW of on site natural gas turbines and a zero water evaporation closed loop liquid cooling system.
Stargate also announced expansion sites in Milam County and Shackelford County in September 2025. OpenAI Both counties, like most in Texas, lack general zoning, so the new campuses will face fewer local land use hurdles compared to the Abilene site inside the city.
What might change in 2027?
Texas has historically been hands-off on zoning. But the rapid growth of AI data centers, the pressure on power and water, and local opposition may prompt the 90th Legislature in 2027 to consider whether to preempt local AI data center zoning. State Rep. Pat Curry and Senate candidate Rena Schroeder have signaled interest in legislation. In other states such as West Virginia, preemption bills have passed. In Texas such a bill would face strong home rule opposition. No bills have been pre-filed as of May 2026. Texas Legislative Council
For now the patchwork of municipal zoning continues to be the controlling law.
Key takeaways
- Municipalities hold all zoning power for AI data centers in Texas under Chapter 211. There is no statewide AI data center zoning law.
- Most Texas cities treat AI data centers as industrial uses requiring a CUP, SUP, or PUD, with approval timelines of 3 to 12 months.
- A 20% protest by neighboring property owners triggers a three-fourths supermajority requirement for a zoning change.
- Counties generally cannot zone or impose development moratoria. Only Hood County has general zoning power. Unincorporated areas provide a faster but not regulation free path.
- State incentives such as the sales tax exemption and SB 6’s grid rules do not override local zoning.
- Several cities have recently tightened AI data center rules. Among them are Irving, North Richland Hills, San Angelo, and Round Rock.
- Deannexation under SB 2038 offers a way to leave a city’s zoning control.
- The 2027 legislative session may consider preemption of local AI data center zoning, but no bill has been filed yet.
Frequently asked questions
Q:Can a Texas county stop an AI data center from being built?
A:No, with the sole exception of Hood County. Ordinary Texas counties lack general zoning authority and cannot impose a blanket moratorium on a development project. They can apply subdivision platting rules under Chapter 232 and, in designated areas, zoning regulations under Chapter 231. Tex. Loc. Gov’t Code ch. 232, Tex. Loc. Gov’t Code ch. 231, Tex. Att’y Gen. Op. AC-0003
Q:Do I need a conditional use permit for an AI data center in Texas?
A:In most Texas cities, yes. AI data centers are usually not a defined use, so they are often classified as industrial. The city code may require a CUP, SUP, or PUD. Some cities have removed as-of-right permission for principal use AI data centers, like Irving, which now requires a conditional use permit. Irving Ordinance ORD-2025-11063
Q:How long does it take to get zoning approval for an AI data center in Texas?
A:A typical timeline is 3 to 12 months. If a special use permit is needed, add another 2 to 6 months. COMPASS UT White Paper
Q:What is the protest threshold for a zoning change in Texas?
A:For a zoning change that is not a proposed comprehensive zoning change, if written protests are filed by owners of at least 20% of the affected area or of the area within 200 feet, the zoning change needs a three fourths supermajority vote of the city council. Tex. Loc. Gov’t Code § 211.0061
Q:Does the Texas sales tax exemption for data centers override local zoning?
A:No. The state tax breaks are separate and do not preempt municipal land use authority. A city can deny a zoning change even if the project qualifies for the exemption. Tex. Tax Code § 151.359, Tex. Loc. Gov’t Code Ch. 211
Q:What does SB 6 do for AI data center siting?
A:SB 6 (2025) gives PUCT and ERCOT authority over large load interconnection for projects over 75 MW and requires financial security and site control before studies. It does not affect municipal zoning. SB 6 (2025)
Q:Can a developer avoid city zoning by choosing a county site?
A:Yes, if the site is outside any city’s limits and its ETJ. The county cannot zone the land. However, state grid rules and water permits from TCEQ may still apply, and local political opposition can be a factor. Delta County FAQ
Q:What is deannexation and how might it help an AI data center project?
A:SB 2038 (2023) allows a landowner in a city’s ETJ to petition to remove the land from the city’s planning and zoning jurisdiction. If successful, the land falls under only county and state rules. This can free a project from municipal ordinances. GEAA Report
Q:Are there any Texas cities that have banned AI data centers?
A:No verified outright ban exists as of mid-2026. Some cities, like Irving, shifted from as of right to CUP only, which makes it harder but does not ban the use.
Q:What should a developer do before buying land for an AI data center in Texas?
A:First, check whether the land is in a city’s limits or ETJ. If inside, review that city’s zoning code for any data center definition, or the likely industrial classification. Prepare for a CUP or PUD process, including noise studies and buffer requirements. If outside, confirm the county’s subdivision rules and SB 6’s interconnection requirements for large loads. Engage with the community early to gauge potential opposition.
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Junde Liu, JD, LL.M. (Taxation) candidate at UF Law. Originally published on Compute Law Blog. This article is general information and does not constitute legal advice. Reading it does not create an attorney client relationship. The reader should not act on the basis of any content here without first consulting a licensed attorney in the relevant state. Last reviewed for accuracy May 23, 2026.