Shelby County data center ordinance heads to July 28 Plan Commission

A proposed ordinance for data centers in unincorporated Shelby County (outside Shelbyville city limits) is set for additional public review at the next Shelby County Plan Commission meeting on Tuesday, July 28, 2026, at 7:00 p.m.

The item comes from a Unified Development Ordinance text amendment listed as RZ 26-11, which would create a Data Center Overlay District (DCO) with added siting and operating rules. The June 23 meeting packet also notes the county does not have jurisdiction over a proposed data center within the city of Shelbyville.

What the draft would do

The ordinance is listed as a Unified Development Ordinance text amendment (RZ 26-11) to establish a Data Center Overlay District (DCO) with site-specific location and operating standards. The draft would make a data-center proposal subject to the DCO’s additional requirements, on top of the base zoning rules.

According to the meeting packet, a data center would require approval steps beyond simply being “allowed” by the overlay. The county’s approval process described in the packet starts with rezoning to the Data Center Overlay District, which requires a public hearing before the Plan Commission and final action by the County Commissioners. After rezoning, the county would also require a data-center development plan and additional permits and approvals.

Where data centers could be placed (setbacks)

The draft includes distance rules intended to reduce impacts on nearby land uses. It proposes that data-center structures and facilities (with limited exceptions) would not be allowed inside setback areas, and it outlines baseline distances such as:

At least 1,300 feet from a “Sensitive Use” or the boundary of any Residential Zoning District.
At least 500 feet from all outer perimeter property lines of the data center.
Emission point and exhaust stack separation requirements, including 1,000 feet from an adjacent property boundary and 2,000 feet from a “Sensitive Use” or from certain district boundaries (residential, commercial, or agricultural).

Noise limits and generator rules

The draft also sets operating controls aimed at limiting disturbance at nearby property lines. It proposes noise thresholds using both dBA and dBC measurements, including:

40 dBA and 60 dBC between 6:00 p.m. and 8:00 a.m.
45 dBA and 65 dBC at other times

On backup power, the draft permits backup generation using natural gas or Battery Energy Storage Systems, while stating that diesel fuel is not permitted. It also describes limits on when generators can run: except for testing or commissioning activities, generator use would be restricted to backup and emergency use only when the primary source of electricity is interrupted or unavailable. The draft further limits generator testing to no more than once per week per unit, and only during 12:00 p.m. to 5:00 p.m., Monday through Friday.

Water and wastewater requirements

Under the draft, a data-center development plan would need a Water and Wastewater Management Plan, including projected daily and peak water demand and certification tied to water supply availability. The draft also requires certification that the site is not located within a wellhead protection planning area.

For cooling systems, the draft says liquid cooling must use a closed-loop system and that private wells cannot supply water. Water discharge from liquid cooling systems would be allowed only after treatment (if required) and only to a public or semi-public sewage system in accordance with applicable standards. The draft also says expelled water for a loop system may not be sent to streams, creeks, or ditches that outlet into creeks and/or rivers.

Timeline and what to watch next

The next scheduled Plan Commission meeting is Tuesday, July 28, 2026, at 7:00 p.m. The June 23 packet describes this as a public hearing and lays out a comment process for June 23 that the commissioners said would be similar for the July 28 review.

Local reporting following the June 23 hearing says the County is trying to have a Plan Commission recommendation vote moved up to Aug. 12; the County Commissioners could then vote ahead of the end of the six-month moratorium deadline of Aug. 23.

Sources

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