Clifton Township Nears Settlement to End Legal Dispute, Paving Way for Major Data Center Campus
December 31, 2025
In a move that could resolve a protracted legal conflict and unlock significant digital infrastructure development, Clifton Township in Lackawanna County, Pennsylvania, is set to consider a settlement agreement with the developer behind the region's largest proposed data center campus. The settlement, if approved, would end multiple lawsuits and establish a revised framework for the sprawling "Project Gold," highlighting the complex negotiations between municipalities and developers as demand for data center capacity surges.
According to a public notice, the Township's Board of Supervisors will hold a special meeting on the evening of Friday, January 2, to discuss and potentially enter into the agreement with 1778 Rich Pike LLC and JCO LLC. This follows a substantive validity challenge filed by the developer in the Lackawanna County Court of Common Pleas, contesting the township's zoning as exclusionary to data centers. The core of the dispute dates to April, when the developer first alleged the local ordinance unlawfully barred such facilities. Although the township amended its rules in May to permit data centers as conditional uses, the developer continued legal challenges, notably objecting to a 35-foot height restriction deemed insufficient for cooling systems.
The proposed settlement would permit the developer to use the property for data centers and battery storage without conditional use approval, though it binds the project to a detailed list of stipulations. Notably, the developer has agreed to abandon earlier plans for an on-site small modular nuclear reactor or gas-fired power plant. The revised scope for Clifton Township now involves five data centers, a significant reduction from the nearly three dozen initially envisioned. However, each building will be substantially larger, with footprints ranging from 160,000 to 684,610 square feet and heights up to 65 feet. The campus will also include an administration building, a substantial 400-megawatt customer substation, and a 230-kilovolt utility switchyard.
The agreement represents a strategic compromise for both sides. The township acknowledges in the settlement document that its pre-May zoning "may have been found by a court... to be exclusionary," while the developer agrees to withdraw all legal challenges. Attorney Matthew J. McHugh of Klehr Harrison Harvey Branzburg LLP, representing the developer, had argued in a December appeal that the township's denial of the validity challenge was an "abuse of discretion." The settlement states both parties acted "in the interest of avoiding protracted litigation and promoting sound land use planning."
The conditions attached are extensive and designed to address community concerns. They impose a cap of 1 million square feet per building footprint, strict water usage limits prohibiting new wells for cooling and capping withdrawals at 50,000 gallons per day, and requirements for comprehensive environmental, traffic, and fiscal impact studies. The developer must also ensure adequate power interconnection, implement sound mitigation measures with ongoing monitoring, and provide firefighting resources at its own expense. All sewage treatment must occur outside the township.
The outcome of Project Gold is being closely watched in Lackawanna County, which has nearly a dozen proposed data center campuses. This settlement could set a precedent for balancing economic development with local oversight in an industry critical to modern computing but often fraught with zoning and resource conflicts.
Source: thetimes-tribune
