Public Opposition and a Citizen Lawsuit Stall Google's Hermantown, Minnesota Data Center; Council Tables Approval 4-0 Over Pending Litigation and Incomplete Environmental Review

The Hermantown City Council voted unanimously on May 4, 2026 to table Resolution 2026-45 — a $650M Phase I Development Agreement and Tax Abatement Agreement with Harmony Group, LLC, identified in city documents as a Google-owned subsidiary — citing a 9-count lawsuit served by an opposition group and an incomplete Alternative Urban Areawide Review.

The Hermantown City Council unanimously voted to table Resolution 2026-45 on May 4, 2026, deferring action on the Development Agreement and Tax Abatement Agreement that would have authorized a Google-led data center campus in Section 31 of the city. The motion to table — moved by Councillor Jellie and seconded by another councillor — passed 4-0 in a roll-call vote (Jellie, Blas, Peterson, Geissler all voting aye). The substantive vote on the deal itself never occurred.

The council took action shortly before midnight after a public hearing that ran past 11:00 PM, with the cited justifications focused on two tracks: a pending 9-count complaint against the city by an organized opposition group called "Stop the Hermantown Data Center," and the unfinished status of the project's Alternative Urban Areawide Review (AUAR). One councillor framed the question on the record: "Should we do this before the AUR, and should we do this with a current lawsuit pending?"

Key Details (Proposed Deal Terms)

• Project: Hermantown Data Center technology campus, Section 31, City of Hermantown, St. Louis County, Minnesota
• Developer: Harmony Group, LLC (a Google-owned subsidiary, per city staff and Google representative testimony)
• Capital investment: minimum $650 million Phase I; two additional phases anticipated at similar levels (up to four phases allowed under the agreement) — potential ~$1.95B across three anticipated phases (Confirmed — Resolution 2026-45 staff report)
• Vote outcome (May 4): motion to table passed 4-0 by roll call. Substantive vote not taken. (Confirmed — May 4, 2026 transcript)
• Public improvements (developer-funded): $130 million in water, sewer, and road infrastructure transferred to public ownership upon completion; 125% security bond required (Confirmed)
• Tax abatement (proposed, not adopted): 85% rebate of new city property taxes after the city retains the first $100,000 plus 15% of remainder; 20-year abatement per phase; combined term forecast at 28 years (Proposed)
• Abatement caps (proposed): $33.5 million in present-value dollars at a 6.5% discount rate; $70 million nominal forecast; $80 million absolute hard cap; 7% of City Net Tax Capacity per year (vs. 10% allowed by state statute) (Proposed)
• Direct payments (proposed): $850K starting payment to ISD 700 + $50K/year for 28 years ($42.7M total); $150K to City + $7,500/year for 20 years ($4.425M total) (Proposed)
• Employment (proposed): 40 FTE jobs Phase I, +30 each subsequent phase, at 120% of St. Louis County average weekly wage (~$76,190/year) (Proposed)
• Counsel: Overom Law (City Attorney), Fryberger (local abatement and bond), DLA Piper (Chicago — data center contracting and land use specialist) (Confirmed)

Public Sentiment: Vote Tabled Over Sustained Opposition and Active Litigation

The May 4 council session ran past 11:00 PM with substantial public opposition organized around a visible coalition wearing matching green shirts. The dominant theme — repeated in multiple statements — was that approving the Development Agreement and Tax Abatement Agreement before resolving pending litigation and completing environmental review would expose the city to additional legal risk. Council ultimately agreed.

Three concrete legal threads drove the table vote:

• The 9-count complaint. An opposition group, "Stop the Hermantown Data Center," served a complaint alleging the city violated multiple state laws in its "clandestine pursuit of the Google hyperscale data center development." The complaint asserts the 2045 comprehensive plan is the basis for the deal's land-use predicates and demands that the comprehensive plan be vacated — which would nullify prior rezoning and urban service boundary expansion decisions tied to the project. (Confirmed — public testimony, May 4 transcript)
• Open Meeting Law and Data Practices Act allegations. The same complaint alleges that NDAs signed with the developer by named city officials, without council approval, violated Minnesota's Open Meeting Law and circumvented the Data Practices Act. (Confirmed — public testimony)
• Separate AUAR litigation. A pre-existing, separate lawsuit challenges the city's use of an Alternative Urban Areawide Review as the environmental assessment vehicle for the property. The new AUAR is currently in early-phase public comment and scoping. Speakers argued that approving an "incomplete" Development Agreement before AUAR completion compounds legal exposure. (Confirmed)

The City Attorney did not directly answer a councilor's question about whether approving the Development Agreement on May 4 would create exposure to further litigation. That non-answer, combined with the pending complaint and the AUAR status, made the table motion the path of least risk.

Notably, Google sent a senior representative to address the council in person — Liz Schwab, who introduced herself as a 17-year Google employee on the company's technical infrastructure market development, policy, and public affairs team, based in Cambridge, Massachusetts. Schwab acknowledged the lengthy local debate predating Google's confirmed commercial interest. The presence of named, senior Google personnel testifying publicly is itself a meaningful disclosure: it confirms, on the record, that the project is a strategic priority for Google, not a routine site filing.

What to Watch

The lawsuit calendar. Resolution of the 9-count complaint and the separate AUAR litigation will likely set the floor for any future council vote. The motion to table specifically anticipated returning to the resolution after these issues are addressed — described on the record as "two weeks or some meeting after that." (Proposed)

AUAR completion. The new AUAR is in early-phase public comment and scoping. Final AUAR completion is the most likely procedural trigger for the deal to come back to council.

NDA and Open Meeting Law exposure. If the court finds the NDAs violated Minnesota's Open Meeting Law, the city's broader process for high-value private development negotiations could face structural reform — with implications well beyond this single project. (Speculative)

Comparative jurisdiction signal. Hermantown's table vote followed Sidney, Ohio's contested AWS approval by exactly one week. Two near-simultaneous hyperscaler council votes produced opposite outcomes: Sidney approved over opposition; Hermantown deferred over opposition plus active litigation. The differentiator was the lawsuit, not the public sentiment.

The Obedio Advantage

The Hermantown deal didn't surface as a single announcement — it moved through Section 31 land assembly, a previously approved Kimley-Horn right-of-way contract, three separate counsel engagements (local, abatement-specialty, and Chicago-based DLA Piper), an ongoing AUAR process, and at least two active lawsuits before reaching the May 4 public hearing. Tracking municipal calendars, ordinance dockets, council-approved consultant contracts, and active municipal litigation against an opposing interest is how this kind of deal becomes visible 6 to 12 months before it makes a hyperscaler press release — and how the difference between a deal that closes and a deal that gets tabled becomes predictable rather than surprising.