How a small Wisconsin city scuttled a secretive $1.6bn datacenter project; The Guardian, November 1, 2026

Daniel A Medina with photographs by Eric Ruby, The Guardian ; How a small Wisconsin city scuttled a secretive $1.6bn datacenter project

"The relationship between Balloonist and Menomonie began in February 2024 when two Menomonie city officials, Atkinson and David Schofield, the city’s director of public works, signed NDAs with the developer. The one-page agreement, obtained by the Guardian, makes no mention of a datacenter. It does clearly instruct signatories that they cannot reveal the tech company behind “the project” or even the existence of the agreement itself.

A month after he signed the NDA, Schofield presented the city council with a proposed ordinance which would define the term “warehousing” in the city’s code. The newly added definition included the line, “establishments used primarily for the storage, management, processing, and transmission of digital data”, that effectively paved the way for a datacenter. The city council approved the change at an April 2024 council meeting. It is unclear if any councilmembers knew of Balloonist or of the potential datacenter project at the time of the vote.

That was the first step in a nearly 18-month process where the two sides developed plans for the datacenter campus in secret until the city government put out a press release about the proposed project in July 2025, according to interviews, public records and emails obtained by the Guardian. The emails, which cover a period from January to September 2025, show how the city and Balloonist took the necessary actions to make the datacenter a reality.

The emails also reveal, in real time, the fierce community backlash that eventually doomed it...

Knaack said he was proud to have stopped the datacenter, for now, and that he was encouraged to see the growing backlash nationally, claiming Menomonie could serve as a model for other small municipalities fighting back.

“All small communities should be aware that when somebody comes in with a sales pitch that seems too good to be true, maybe it is,” he said. “Learn from our mistakes and follow our lead...

At least $156bn in projects were blocked or delayed in 2025 across the United States, according to Data Center Watch, a project by the AI safety firm, 10a Labs, that tracks opposition nationwide to datacenters. This year, between April and June, 45 projects worth an estimated $68bn were blocked or delayed.

That opposition to the infrastructure that trains and powers AI models, and growing public distrust of the industry itself, has become one of the defining bipartisan issues ahead of the midterm elections.

President Trump, who has made AI the centerpiece of his second-term economic agenda, lashed out in an August Truth Social post that communities that opposed AI datacenters risked ending up “backwards and poor”.

At the local level, more than 500 counties and municipalities now seek to ban or restrict datacenters, according to an analysis from the climate news site HeatMap."