Chicago Mayor Brandon Johnson introduced an ordinance Wednesday that would impose a 12-month moratorium on new data center development as city officials consider how to regulate an industry that has rapidly expanded alongside the growth of artificial intelligence. Chicago currently has 39 active data centers, according to the city.

The proposed pause would give a task force created by Johnson in August time to develop a permanent regulatory framework addressing data centers’ potential effects on air pollution, noise, water use and electricity demand. Most of Chicago’s existing facilities were developed under older zoning rules that classified them similarly to office buildings.

Johnson said Chicago remains open to investment but argued that development must be accompanied by protections for residents. “Chicago is open for business, but we are not for sale,” Johnson said in a statement accompanying the ordinance, adding that growth should protect residents’ health, safety and quality of life.

The proposal faces an alternative from Ald. Bill Conway of the 34th Ward. His ordinance would not impose a moratorium but would instead establish additional zoning requirements and require community and environmental reviews for new data center projects. Conway has argued that Johnson’s proposal could lead to extended debate and litigation while projects continue under existing rules.

The data center industry is pushing back. Data Center Coalition executive Brad Tietz said the facilities generate revenue and billions of dollars in economic investment for Chicago, while warning that the proposed moratorium could send a signal that the city is “closed for business.”

The dispute comes as concerns over data centers’ electricity and water demands spread across the country. Consumer advocates in Illinois have warned that the industry's growing electricity consumption could contribute to higher utility costs, while communities in several states have adopted or considered temporary restrictions as they develop new rules.

Illinois Gov. JB Pritzker has paused new state tax incentives for data centers but has said he does not have authority to impose a statewide construction moratorium. Several Illinois communities have separately paused new data center development or expansion.

The Chicago proposal also puts the city debate at odds with President Donald Trump’s stated position on data center development. Trump has criticized communities seeking to restrict the facilities, arguing that data centers can bring jobs, investment and lower taxes.

Neither Chicago ordinance has taken effect. Both proposals will move through City Council committees before a vote, meaning the council will ultimately decide whether Chicago temporarily freezes new data center development or adopts additional zoning and environmental requirements instead.