Pima County's New Zoning Code for Data Centers: Implications for Investors

Executive Summary

Pima County, Arizona, is moving to create a dedicated zoning code and formal land-use definition for data centers, a regulatory shift that will materially alter site acquisition and development strategies across the region. County supervisors have directed planning staff to draft the new rules, with a final vote expected in December following a public input period. Investors and developers who get ahead of the regulatory curve stand to benefit from early positioning; those who ignore the process risk overpaying for land that may face new use restrictions or permitting hurdles. The InfraSale takeaway: Pima County data center zoning is becoming a defined discipline, and capital that treats it as such will outperform.

What Happened

Pima County supervisors have directed planning and development staff to draft a separate zoning code and formal definition specifically for data centers. The move signals that county leadership views data center development as categorically distinct from general commercial or industrial land use—a distinction that carries real consequences for permitting, site selection, and development rights.

Public hearings have been held to collect community feedback on the proposed rules. The input process reflects a deliberate effort by the county to balance economic development interest in data centers with concerns over power consumption, water use, noise, and visual impact—issues that frequently surface in community opposition to large facilities.

A final vote on the new regulations is expected in December. Until that vote, the exact contours of the code—setback requirements, power thresholds, use-by-right versus conditional use permit classifications—remain subject to change.

Source: KJZZ / Google Alert - Solar Energy

Why This Matters

Creating a standalone zoning category for data centers is not a minor administrative step. It signals that Pima County has crossed the threshold from ad hoc project approvals to systematic land-use governance for this asset class. That transition changes the risk calculus for every parcel in the county that a developer might be eyeing for data center use.

New zoning definitions typically bring stricter standards: conditional use permits instead of by-right approvals, environmental review triggers, utility coordination requirements, and potentially siting exclusions near residential zones. Any of these could compress the pool of viable sites and push land prices higher for parcels that qualify.

Industry context: Across the Southwest—including Maricopa County and parts of Nevada—local governments have followed similar trajectories, moving from permissive general-industrial allowances to structured data center overlays. Pima County's action fits a broader pattern of municipal governments attempting to capture revenue benefits while managing infrastructure strain. The outcome here could set expectations for other Arizona counties still operating without dedicated data center rules.

Power & Interconnection Impact

Data centers are among the most power-intensive land uses a county can permit. A single hyperscale facility can draw 100 MW or more at full load. Pima County's zoning process will almost certainly require applicants to demonstrate interconnection capacity or utility coordination as part of project approval—either explicitly in the new code or through environmental review conditions.

Assumption: Tucson Electric Power (TEP), the primary investor-owned utility serving Pima County, will be a central stakeholder in the zoning rulemaking. Any code that requires applicants to address power supply adequacy will force early engagement with TEP on transmission capacity, substation availability, and load growth commitments.

For investors, this means interconnection timelines belong in your pro forma now, not after entitlement. Sites with existing substation proximity or high-voltage transmission access will carry a measurable premium once the new code codifies power requirements as a permitting criterion.

Land, Zoning & Permitting Impact

The most immediate implication of a dedicated data center zoning code is a redefinition of which parcels are viable. Land that sits in a general industrial or commercial zone today may gain or lose data center development eligibility depending on how the new code draws its boundaries.

Developers and landowners should monitor the draft language closely for two key variables: whether data centers will be a permitted use by right or require a conditional use permit (CUP), and whether the code includes specific exclusion zones near residential areas, water resources, or flight paths. CUP requirements add 6–18 months to approval timelines and introduce community opposition risk at every hearing.

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Landowners who haven't participated in the public input process are already behind. The comment period shapes the draft, and the draft shapes the vote. Parcels that get explicitly called out in opposition testimony—due to proximity to neighborhoods or limited utility access—may find their development potential compromised before a single application is filed.

Investment Takeaway

Buy the eligible, avoid the speculative. Once the zoning code passes, parcels that qualify by right for data center use will reprice. Parcels that require CUPs become binary bets on local politics.
Power access is the new location premium. Sites with existing or near-term substation access in Pima County will command a structural premium over comparably located parcels without it.
Timeline risk is real. A December vote does not mean December clarity. Implementation guidance, appeals, and code interpretation battles can extend uncertainty into mid-2026 or beyond. Underwrite accordingly.
Engage now, not after the vote. Investors with existing Pima County holdings or active site searches should participate in the public input process or retain local land-use counsel who can monitor draft language in real time.
Watch for neighboring-county spillover. If Pima's code is restrictive, development pressure will migrate to adjacent jurisdictions—Pinal County in particular—creating secondary opportunities for investors positioned there.

InfraSale Market Angle

For developers and investors actively sourcing data center sites, Pima County's regulatory process is a forced-ranking exercise happening in real time. The sites that survive the new zoning code as viable, by-right development candidates will constitute a smaller, more valuable subset of today's market. Getting that list right before December is the competitive advantage.

Landowners in Pima County who aren't tracking this process are exposed. A parcel that looks like a development asset today could be reclassified, restricted, or burdened with new permitting requirements by year-end. Conversely, owners of power-adjacent parcels that meet likely code criteria should be actively engaging capital now, while the market hasn't yet fully priced the scarcity effect.

InfraSale users in the investor and developer segments should be using this window—between public input and final vote—to stress-test site assumptions, verify utility capacity, and identify which parcels in their pipeline are at risk of falling outside the new code's permitted use envelope.

Market Signal

Location: Pima County, Arizona
Primary Issue: New zoning regulations for data centers
Infrastructure Theme: Zoning
Who Benefits: Investors and developers who adapt to new regulations
Who's at Risk: Landowners unaware of the changing landscape
InfraSale Takeaway: Monitor the zoning changes closely to adjust investment strategies accordingly.

Take Action

Pima County's zoning process is moving on a fixed timeline, and the window to influence outcomes—or position ahead of them—is closing. Investors and landowners who act before the December vote will have options that those who wait simply won't. List a powered land site on InfraSale to identify which assets in your pipeline are best positioned under the emerging regulatory framework.

FAQ

What are the new zoning regulations for data centers in Pima County?

Pima County supervisors have directed planning staff to create a dedicated zoning code and formal land-use definition for data centers—a category that currently falls under broader commercial or industrial classifications. The draft rules are being shaped by public input, with a final vote expected in December. Specific standards for setbacks, power requirements, and use classifications have not yet been publicly finalized.

How will the zoning changes affect land values in Pima County?

Parcels that qualify as permitted sites under the new code are likely to see increased demand and pricing pressure, as the eligible universe of data center sites will narrow. Industry context: In other jurisdictions that have enacted dedicated data center zoning, land values for qualifying sites appreciated meaningfully relative to general industrial comparables. Parcels that fall outside the new code's permitted zones may experience softening interest from data center developers.

What steps should investors take in light of these changes?

First, identify which parcels in your Pima County pipeline are most likely to qualify under the new code—focusing on power access, proximity to transmission infrastructure, and distance from residential zones. Second, engage local land-use counsel or planning consultants to monitor draft language before the December vote. Third, stress-test your pro forma for CUP timelines if by-right approval is not guaranteed under the emerging rules.

Could Pima County's approach influence other Arizona counties?

Industry context: Yes. When a major county adopts a structured regulatory framework for a new asset class, neighboring jurisdictions frequently follow—either to capture development that might otherwise migrate or to proactively manage similar community concerns. Pinal County and others without dedicated data center zoning may face increased development pressure if Pima's code proves restrictive, which could create secondary land opportunities.

When will the new zoning code take effect?

A final supervisors' vote is expected in December. However, code adoption does not guarantee immediate implementation clarity—interpretation guidance, potential legal challenges, and administrative rulemaking can extend the practical timeline. Investors should plan for regulatory uncertainty through at least mid-year following the vote.