The Rochelle City Council discussed a potential development agreement Monday with Project Crossroads, a much talked-about data center development.

The council did not hold a vote on the matter, but may at an upcoming meeting. Interim City Manager and City Engineer Sam Tesreau made a presentation Monday on the draft development agreement. The 50-megawatt, 300,000-square-foot data center would be located in the area of Steward Road and South Main Street, located near Interstate 88 and railroad tracks.

The developer has owned the potential site near Steward Road since 2013, contacted the city in 2024 and has been working with it on the project since. If the development agreement was approved, the developer would then work to find a data center client to fit the project.

The city owns Rochelle Municipal Utilities, which would see it provide power, water, sewer and fiber services to a potential data center, which could procure its own power off the market and use RMU for billing and delivery.

The development agreement would stipulate and enforce limits on utility use by the data center, along with its obligations to pay for any improvements needed and other items such as noise pollution. The city would not provide any incentive funds to the developer. The data center would be eligible for the state’s 50% property tax abatement for six years, as other businesses located within the Lee-Ogle Enterprise Zone are.

Rochelle is already home to two data centers, owned by Allstate and Northern Trust. Those data centers have been in Rochelle for 15 years and use a combined seven megawatts of electricity. DeKalb is home to a Meta (Facebook) data center, which is about six times the size of the proposed project in Rochelle.

Tesreau said Monday that the draft development agreement is about 95% complete. Midwest Power Investors is the owner of the real estate and interested developer. They have requested a maximum electrical load of 50 megawatts for the proposed facility. The developer would pay for all required RMU electrical improvements, estimated to cost $4 million.

“We went through the language of this on several occasions to make sure all of our excess electrical charges are covered,” RMU Superintendent of Electric Operations Blake Toliver said. “So that way, there’s no detrimental effects to our existing customer base. Any excess costs would be covered by whoever occupies this space.”

Toliver said the 50-megawatt increase in RMU load would still leave the city with 60% of its capacity available.

“The reason why we set the number at 50 megawatts was to not stifle any growth of our existing customers if they need to expand,” Toliver said. “Or to take on another development. We’d still have plenty of excess capacity to do so.”

Water and sewer infrastructure would need to be constructed to service the facility. Those improvements are estimated to cost $2.8 million. The developer would pay for those improvements, Tesreau said. The developer would post surety bonds to make sure it pays for all required infrastructure improvements.

The data center development’s water use would be capped at 50,000 gallons per day. RMU Superintendent of Water/Water Reclamation Adam Lanning said the developer would likely use about 10,000 gallons per day. Those water use amounts are not uncommon among other RMU customers, Lanning said.

The data center development would also require perimeter and offsite road improvements, lighting and upgrades to curb and gutter. Those costs would also be paid for by the developer.

“There are also impact fees in here for phase one for soft costs related to staff, legal and consulting resources that have gone into the agreement,” Tesreau said. “There’s been a lot of city time invested in this agreement over the past year plus.”

The city would have “reasonable approval” over the appearance of the development as well as on suppression measures to reduce sound levels from the data center.

The city held a public meeting about the proposed data center development on Nov. 18. The city has seen recent social media reaction to news of it talking with a developer about a new data center. A petition, titled “Reject plans for a data center in Rochelle, Illinois”, had 280 signatures as of Feb. 10. No public comments for or against the data center were seen Monday.

Tesreau said the development could see second and third phases in the future with second and third buildings and increased utility usage. Those potential future phases would also need development agreements and approval by the city council.

The hypothetical phase two could see the data center increase its electrical load to 100 megawatts and phase three would up it to 150 megawatts. That increased load would require transmission line reconductoring by ComEd due to increased load.

“I think my biggest concern in all of this is the future expansion,” Councilwoman Kate Shaw-Dickey said. “It’s a considerable investment for them to come in and build this, which tells you that they fully plan to further expand. I appreciate knowing it still has to come back through us.”

The first phase of the project, once constructed and in operation, would see 15-25 estimated full-time employees. The data center development would pay about $3.5 million in property taxes per year after construction, even with abatement. Rochelle school districts would receive about $2.1 million of that, City Director of Community Engagement Jenny Thompson said.

The data center would pay about $456,000 per year in utility tax, which would almost double the current number the city receives. It would pay $125,000 to the city in permit fees.

Mayor John Bearrows said the council will consider the draft development agreement before a future vote and public commentary opportunities on the matter will be held at meetings before it’s voted on.

“I really believe that this agreement was put together to protect our community,” Bearrows said. “Not to just try to see where we could create another revenue stream.”