Oregon Governor Tina Kotek ordered the state Department of Administrative Services on July 30 to terminate a Mill Creek Corporate Center land sale contract for a massive proposed data center in Salem, bringing the controversial project’s future into sharp uncertainty amid intense community pushback.
Governor Kotek Halts the Mill Creek Land Sale
Oregon Governor Tina Kotek ordered the state to withdraw its land sale for a controversial data center development near Salem. The administrative directive instructed the Oregon Department of Administrative Services to cancel its contract with the California-based technology firm Verrus regarding a 32.23-acre parcel within the Mill Creek Corporate Center in southeast Salem.
The affected property represents nearly half of the 75-acre footprint designated for the Oakline at Mill Creek project. According to municipal records, the Department of Administrative Services initially agreed to the land sale in May 2025, scheduling a final transaction close for October 2026. Governor Kotek announced the cancellation upon learning details of the development, framing the intervention as a necessary defense of public resources and local infrastructure.
“This decision is about my responsibility to make sure state actions reflect Oregon’s values and serve the public interest.”
Gov. Tina Kotek, via KATU
The governor noted that while she supports economic growth and technology investments, large-scale projects must be rigorously evaluated for their long-term demands on regional energy grids, water supplies, and community stability.
“I believe in growing Oregon’s economy and welcoming new investment, including in the technology sector. But growth has to make sense for the community, for our infrastructure, and for our natural resources. Oregonians have made it clear they expect thoughtful, responsible decisions about projects of this scale, and I agree.”
Gov. Tina Kotek, via Statesman Journal
Public Outcry Precedes Executive Action
The executive intervention arrived just days after hundreds of residents packed the municipal chambers on July 27 for a Salem City Council meeting.
Salem resident Brian Hines observed that the demonstrations marked the most intense public engagement the City Council had ever witnessed on a single subject.
“The protests that came out at last Monday’s City Council meeting was the most intense and emotional; in just the sheer numbers they’ve ever seen on any subject in Salem.”
Brian Hines, Salem resident, via KATU
Environmental advocates and local community members voiced deep misgivings over the environmental toll of artificial intelligence and digital infrastructure. Hannah Shooting Bear, a Salem resident and founder of Indigenous Now, encapsulated the local anxiety surrounding industrial expansion in the valley.
“I’m proud to live in Oregon because the green, the cleanliness of it, but when you start bringing these data centers in, that’s not gonna be clean and green anymore.”
Hannah Shooting Bear, Salem resident and founder of Indigenous Now, via KATU
Company Response and the $5.1 Billion Investment Stakes
City leaders only recently revealed comprehensive financial details for the initiative, which represented a $5.1 billion data center proposal ranking among the largest private investments in Salem’s history. Verrus leadership expressed sharp frustration regarding the sudden executive halt, asserting that the administration acted prematurely without official consultation.
“This decision was made unilaterally and without consultation — before Verrus had the opportunity to present its design, infrastructure plan and community benefit proposals to address these concerns and demonstrate our shared commitment to Oregon’s values.”
Verrus company officials, via KATU
Company executives maintained that they engaged in proactive outreach prior to submitting formal applications, aiming to establish a community benefits agreement that addressed grid capacity and water conservation.
“That is why we proactively announced Oakline before a formal application was filed. We wanted to give everyone in the Salem community – including residents, neighbors, tribes, and city leadership – the opportunity to ask hard questions and help shape the project.”
Verrus company officials, via KATU
Municipal Government Next Steps and Upcoming City Council Meetings
Despite the cancellation of the state land contract, municipal authorities confirmed that local legislative procedures will continue as scheduled. Salem City Manager Krishna Namburi emphasized to the community that the enterprise was not a done deal and urged residents to remain active in the public review framework.
The Salem City Council scheduled a special meeting for August 3 to evaluate potential zoning code amendments and discuss initiating a formal moratorium specifically targeting AI data centers. City administrators clarified that Governor Kotek’s administrative order does not alter the municipal need for these regulatory policy discussions.
Meanwhile, state-level policy development continues in parallel. Governor Kotek established a Statewide Data Center Advisory Committee in January to formulate statewide regulatory recommendations. Committee members are slated to review draft findings and deliberate further, with Verrus leadership noting their ongoing participation in presenting alternative design models that promise reduced water consumption and grid support.
