Live Free or Ban Data Centers

Happy Tuesday, and welcome to another edition of Rent Free. This week’s newsletter covers a number of new reforms that try to relegalize formerly ubiquitous forms of affordable housing.

• In Washington, D.C., the city council will consider a bill to allow taller single-stair apartment buildings.
• The Idaho Legislature has passed a bill allowing small starter homes to be built on smaller lots.
• Florida Gov. Ron DeSantis has signed into law a bill that allows manufactured housing to be built in single-family areas.

Single-stair apartment buildings, starter homes, and manufactured housing are nothing new. All worked to make the American cities and towns of the past more affordable, accessible places to live.

Over the decades, states and localities have imposed rules that restrict or even ban these forms of housing. As evidenced by the reforms advancing across the country, many policymakers consider those restrictions a mistake. Bit by bit, we’re returning to the old, freer land use regime.

But first, the newsletter covers how the backlash to data centers in rural Ohio is leading some communities to consider adopting zoning for the first time.

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Live Free or Ban Data Centers?

In rural Ohio, residents are balancing two uncomfortable propositions: live next to new data centers or adopt zoning codes to stop them.

WUOB, the state’s public media outlet, reports that a mounting number of data center developments are springing up in the state’s southeast, where many of the area’s rural counties have no zoning codes.

The data centers are often unpopular, with local residents complaining about large, unsightly buildings consuming existing farmland and the lack of transparency from local governments and data center builders about their projects.

But without zoning codes, local officials have limited ability to block new data centers where they’re proposed.

As I noted in a recent cover story for Reason, data centers are—all things considered—pretty low-impact land uses. They’re not particularly noisy. They don’t emit noxious fumes or smells. Their small permanent staffs mean that they also don’t strain local roads and schools. Their water use is normal, and the impacts of their admittedly gargantuan power consumption are overblown.

For all those reasons, there are few environmental laws or nuisance regulations focused on actual neighborhood effects that one could use to stop new data centers from opening up. For that task, one needs zoning.

Zoning skips the whole business of regulating externalities and instead gives local officials the direct power to say what kinds of buildings are allowed where.

It’s a perfect tool for stopping data centers. The problem is that zoning is a perfect tool for stopping almost everything.

“We don’t have to ask permission for simple things like putting up a fence, so that’s great.…At the same time, I think there should be some form of protection in place for this type of thing,” WUOB quotes one woman who is concerned about new data center development while also wary of the regulations required to stop them.

The outlet notes that some towns are adopting straight moratoriums on data center development as an alternative to comprehensive zoning, but these can only be a temporary measure.

For people who don’t want zoning, moratoriums can be risky business. Read Reason‘s coverage of land use battles in Caroline, New York, where a temporary moratorium designed to stop a Dollar General morphed into a wider effort to impose zoning on the then-unzoned town.

At the end of the day, freedom for me but not for thee is a hard thing to write into the law. The conflict over data centers in unzoned Ohio is evidence that being allowed to do what you want on your property usually requires tolerating what someone else does on their property—even if it’s building a data center.

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The D.C. City Council Considers Single-Stair Reform

Today, the Washington, D.C., City Council’s Committee of the Whole will consider a bill introduced by Councilmember Brianne Nadeau that would allow apartment buildings of up to six stories to be built with just one staircase.

Like most U.S. cities, D.C. currently requires apartment buildings over three stories in height to have two staircases as a fire safety measure.

Reformers have argued that the requirement of a second staircase significantly increases costs to new construction and stymies the construction of smaller apartment buildings on smaller urban lots.

That’s a loss for supply and affordability, advocates argue. And because new multifamily housing has the best fire safety record, single-stair requirements that prevent new multifamily construction could actually reduce fire safety.

New York City and Seattle have long allowed single-stair buildings to rise six stories. According to Pew, seven states passed single-stair reforms in 2025 that either require building code updates to allow taller single-stair buildings or otherwise require building code officials to consider such reforms.

Nadeau’s “One Front Door Act” would require city building officials to update construction codes to allow six-story single-stair buildings within two years.

The reform will “increase the amount of space that can be built for residents, making it more economical and easier for builders to create more units or bigger units, which are good for families,” said Nadeau in introducing the bill last year.

A public hearing on the bill was held in January. Written testimony shows a long list of housing policy groups, architects, and real estate advocates in favor of the reform. The main opposition comes from the city’s Fire Fighter Association.

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Idaho Passes Sweeping Starter Home Reforms  

Last week, the Idaho Legislature passed a bill allowing “starter home subdivisions” in municipalities across the state.

Senate Bill 1352, which was transmitted to the governor yesterday, would require cities of 10,000 people or more to update their land use laws to allow single-family homes on lots as small as 1,500 square feet within new subdivisions of at least four acres.

Similar “starter home” legislation is becoming an increasingly common form of housing supply reform. “Small homes on small lots” offers the potential for more modestly priced, owner-occupied housing. When restricted to new subdivisions, these bills can avoid some of the fights about allowing multifamily housing in existing residential areas.

According to the American Enterprise Institute’s housing legislation tracker, over a dozen states have considered lot size reform bills this year.

Texas made headlines last year when it adopted a law allowing starter homes on 3,000-square-foot lots in five-acre subdivisions in larger cities and counties last year. Idaho’s reforms go beyond Texas’ policy by allowing even smaller lots in smaller subdivisions in smaller communities.

In addition to S.B. 1352, the Idaho Legislature is also considering reforms that would allow duplexes and accessory dwelling units in single-family areas. Bills that would enact those reforms passed the Idaho Senate earlier this month and are now being considered by the House.

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Florida Passes Bill To Boost Manufactured Housing, Reduce Permit Fees

On Friday, Florida Gov. Ron DeSantis signed into law House Bill (H.B.) 399, which would restrict local governments’ ability to discriminate against manufactured housing.

The new law requires local governments to allow off-site constructed manufactured housing anywhere that detached single-family homes are also allowed. Localities are also forbidden from regulating manufactured housing more restrictively than single-family housing in the same zoning district.

Manufactured, a.k.a. mobile, homes used to be a significant portion of new homes built in America. These homes were also typically the most affordable form of new housing.

Brian Potter, author of the Construction Physics Substack, notes that in some years in the 1960s and 70s, as many as a fifth of new homes were factory-built manufactured housing.

In the 1970s, this type of housing went into steep decline, the reasons for which are debated. Some blame federal regulations of manufactured housing. Certainly not helping matters were the proliferation of zoning codes that explicitly banned manufactured housing in whole communities.

In more recent years, there’s been a rising interest in attempting to revive the manufactured housing sector.

The housing bill currently being considered by Congress would peel back some federal regulations on manufactured homes. Florida’s H.B. 399, meanwhile, tackles the zoning restrictions that keep these units out of town.

The new law also requires local governments to cap permitting fees at the cost of actually reviewing and processing building permits.

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Quick Links

• The Argument‘s Jerusalem Demsas on Congress’ bipartisan bias against renters
• The FBI is warning homeowners about a new scam in which fraudsters send them fake letters demanding payment for building permits. The bureau says the scam is so successful because the fraudulent fee demands sound so much like the real, random fees homeowners have to pay.
• A Rhode Island House committee will consider a bill that repeals regulations on single-room occupancy and co-living housing today.
• America’s first developer president wants his presidential library to be a gleaming glass tower.
• No lies detected:

(Georgist meeting) we recognize that we are holding this meeting on untaxed land,

— Harlo Pippenger ???????????? (@PippengerHarlo) March 30, 2026

The post Live Free or Ban Data Centers appeared first on Reason.com.

Source: https://reason.com/2026/03/31/live-free-or-ban-data-centers/