How nondisclosure agreements keep AI data center details hidden from Americans
The larger technology company backing the project has remained undisclosed, having used nondisclosure agreements and registered the proposal through a smaller company, Spark Innovations LLC, which locals believe is a shell company.
St. Charles Mayor Dan Burgmeier, who is bound by a nondisclosure agreement, said he pleaded with developers for months to let him share details but they refused, citing concerns about competition.
Supporters of the rubble project He eventually pulled out. In August, he became Saint Charles The first city in the country to be enacted One-year ban on data center construction.
Similar bans have been approved and proposed in dozens of counties and towns across the country, including… Saint Louis, Oldham County in Kentucky and Jerome Township, Ohio.
In Arizona, the secrecy of data center developers backfired.
Pima County officials were bound by a nondisclosure agreement on “Project Blue,” a $3.6 billion proposal by Amazon Web Services, according to a one-page county memo obtained by NBC News through a public records request. The project, which was to be built outside Tucson, was revealed through a leak to the local outlet Arizona Luminaria.
Dr. Matt Haynes, a member of the Pima County Board of Supervisors, said he didn’t even realize he was covered by the agreement until a spokesman for the developer called to accuse him of violating the agreement by speaking to a local newspaper.
“I have a lot of problems with the general idea that I, as an elected official representing over 200,000 people in Pima County, could be held to the standards of a nondisclosure agreement with a private, for-profit entity,” Hines said. “It seems like there might be a natural conflict with what I need to do to serve my constituents.”
Because Pima County officials were bound by a nondisclosure agreement, Tucson city leaders, whose city utilities were responsible for providing water and power, said they were left in the dark until late in the process.
“The lack of community engagement from the jump has led to a lot of distrust,” City Councilwoman Nikki Lee said. “I have never seen Tucson as united in opposition to one thing as it was on this project.”
In response to the proposal and lack of information, residents They built their own dashboard To try to benchmark Project Blue data and water consumption. “We calculated that Project Blue would use more energy than every home in Tucson combined,” said Ed Hindle, whose company Sky Island AI created the dashboard.
After a public outcry, the Tucson City Council canceled the project. Pima County Board of Supervisors as well Vote to dissolve the NDA 90 days before any county body votes.
Keep calm to stay competitive
The data center industry is a fast-moving and highly competitive field in which companies are located View confidentiality as essential To protect trade secrets and stay ahead of competitors. Caught between corporate demands and public accountability, some local officials said they felt pressure to sign nondisclosure agreements to keep their communities afloat.
Mason County Attorney John Estill, who signed a non-disclosure agreement for the project proposal, said county leadership would prefer not to abide by the NDA but emphasized it was the only way for elected officials to stay informed of the company’s plans.
“You either want your government to court companies and look for growth in your communities, or you don’t,” Estelle said. “And if you want your government to court companies and look for growth in your local economies, NDAs are unfortunately part of the landscape.”
But many residents don’t see it that way.