Port Washington council OKs annexation deal for data center

Port Washington officials are one step closer toward bringing a massive data center complex to the city.

On Tuesday night, the Common Council approved an agreement allowing the city to annex 1,900 acres in the surrounding Town of Port Washington. The town board approved the agreement earlier the same day.

Officials had revealed tentative data center plans at a council meeting on Jan. 8.

Port Washington Mayor Ted Neitzke IV told WPR he believes a data center’s advantages “far outweigh the cons.” He claimed it would almost double the city’s total tax valuation.

That could halve residents’ property taxes, Neitzke said. He added that “worst case scenario, your property taxes would hold.”

Data center developer Cloverleaf Infrastructure is driving the project.

The new agreement allows Cloverleaf to pitch the site to prospective operators like Google or Meta. The area was otherwise protected from annexation until 2026.

“They cannot make a deal with one of those end users without assurances that the annexation could occur sooner than 2026,” said the city’s attorney Chris Smith at Tuesday’s council meeting.

Smith said any potential annexation hinges on Cloverleaf finding a buyer and the city agreeing to terms with that buyer.

“If any of those do not happen, then everything becomes moot. There is no annexation,” he added.

The 1,900 acres are bounded by Interstate 43 to the east and south, the Ozaukee Interurban Trail to the west and Dixie Road to the north.

Developer hopes to grow energy capacity for data centers

Cloverleaf was founded in Feb. 2024, according to an interview with its co-founder Brian Janous in industry news outlet Data Center Dynamics.

In that interview, Janous said he started the company after realizing power utilities were unable to keep up with AI’s ballooning energy needs.

His company specializes in buying up property and working with utilities to bring “the largest electric loads” to data center sites, per its website — not in actually building the facilities.

At an earlier meeting, Cloverleaf representative Aaron Bilyeu told the Port Washington Common Council that new data centers often use up to 350 megawatts of electricity.

That’s enough to power 280,000 households. The entire city of Milwaukee has 231,000 households.

A spokesperson for WE Energies said the local utility is “committed to adding capacity and infrastructure to serve this site.”

Private equity firms NGP Energy Capital and Sandbrook Capital invested $300 million in Cloverleaf this summer.

Cloverleaf’s website doesn’t mention any other projects in the works besides Port Washington.

Neitzke said he expects the company to bring several centers to the 1,900-acre site in phases, adding he believes high demand for the centers could make that process go quickly, with “dirt moving by fall.”

Community divided over data center plans

The city will craft its zoning code to maximally conceal the data center, Neitzke said.

“They recognize that we want to maintain the beauty and charm of our city while growing and developing in a scalable and sensible way,” he said of Cloverleaf.

Cloverleaf is buying land for the project via private transactions, according to a statement from Port Washington.

“We have never, and we never will, make a threat of eminent domain,” Neitzke said.

Speaking during the Common Council’s public comments, some residents spoke out against the plan.

“This legacy that you’re going to create, I don’t think it’s what you think it’s going to be,” said Kim Tydrick, who lives near the site. She said she’s concerned about noise and light pollution.

Ben Donajkowski, who lives inside the site, told the council his family “would throw a very large party if this whole thing were to fall through.”

“Cloverleaf can promise the moon before they turn around and sell it,” he added. “But they can’t guarantee what Meta, IBM or whoever will do once it’s theirs.”