Companies Consider Data Center for Oneonta Rail Yards; Idea Already Draws Opposition
By ERIC SANTOMAURO-STENZEL
ONEONTA
Two companies have recently inquired about building a data center at the Oneonta Rail Yards in the City of Oneonta. Otsego Now, the county’s quasi-governmental umbrella development agency, owns most of the area property.
One in-state and one out-of-state company contacted the agency over the last two months, according to Otsego Now Chief Executive Officer Jody Zakrevsky. In an interview, he told AllOtsego he believes the loose project ideas are “not viable” due to the property’s current infrastructure. Zakrevsky said the two companies, which he was not at liberty to name at this point in the process, appeared to be shopping around for potential locations to build data centers.
At Otsego Now’s October 9 Projects Oversight Committee meeting, Zakrevsky requested a proposal be drafted for NYSEG to conduct a study on cost and power needs to “accommodate a data center” at the site, meeting minutes say.
Zakrevsky told AllOtsego that the agency would be applying for a grant from New York State to cover the costs of the study. “I hope [the study is] under a half a million dollars, because that’s the most we can get from Empire State Development,” he said. Zakrevsky added that Otsego Now would not pursue the study absent a grant. He estimated the potential sale cost of the rail yard property to be around $400,000.
Ellen Pope, the executive director of the environmental nonprofit Otsego 2000, said why bother.
“The idea that Otsego Now is considering investing scarce resources in a study to determine how to increase power to the Oneonta Rail Yards to accommodate a data center is deeply concerning,” she wrote in a statement. Pope said the “evidence is clear from other communities” that “the impacts on water, air, noise, and residential energy supply far outweigh any potential benefits to the community.”
Referencing widespread opposition to the Eco-Yotta Inc. proposal for an AI research center in the neighboring Town of Oneonta, Pope asked, “Why would Otsego Now spend money on a losing proposition?”
Zakrevsky defended the investment by pointing to Governor Kathy Hochul’s prior expressed support for AI development as an inevitability to be addressed rather than avoided.
County Board Representative Andrew Marietta, a Town of Otsego Democrat, is a board appointee to Otsego Now. He told AllOtsego that regardless of outcome, an electricity study would provide useful numbers for potential developers interested in the long under-utilized property and that the group tries to hear out proposals that come their way, with decisions coming later in the process. Marietta said a data center would have to clear a “high bar,” later referencing opposition to Eco-Yotta’s proposal.
“The challenge would be on them to prove that they can be successful, that they can operate, and be a fit for Otsego County, for the City of Oneonta,” he said. “I don’t know why a data center would ever be a fit for rail yards” unless it were small scale, Marietta said, pointing to resource needs.
Zakrevsky told AllOtsego the companies have yet to provide any “concrete information” on what they would like to build.
“They haven’t really given us any development plans or any budgets. So we’re a little bit in the dark on it,” he said.
The companies gave a timeline of a couple months to provide more details, Zakrevsky added.
“One of our problems in the Oneonta Rail Yards is that we have very limited gas, if any, to supply any type of large energy user,” Zakrevsky said. “Our electric would have to be completely upgraded,” and at this point “we can’t even consider doing anything.”
The Oneonta Rail Yards have long been underutilized, according to Otsego Now public documents. Currently, Zakrevsky said, Otsego Now is conducting “a study on a stormwater management plan so that we can further develop the site.” He added that Otsego Now is considering the site for light manufacturing.
Nationally, hundreds of billions of dollars have been invested in the artificial intelligence boom. The fledgling technology requires immense amounts of computing power and corresponding electricity. According to a Business Insider investigation, permit requests for data centers quadrupled between 2010 and 2024, now totaling at least 1,240 current or proposed data centers across the country.
Rarely needing any particular location, developers have often chosen areas with ample property availability, relatively low electricity costs, and where they perceive political opposition to be unlikely. The projects have grown unpopular for their resource usage, noise, size and small numbers of new, permanent jobs to maintain the facilities once built.
Otsego Now’s Board of Directors would have final say on any property sale, Zakrevsky said.
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We would definitely need a traffic light at Fonda and Chestnut Streets. Also, the road has to be paved running to the West End where, again, a traffic light might have to be installed. I see a lot of business finally redeveloping on the West End of town. Perhaps like it used to be!
The Rail yard is homage to a lot of stray cats which the future Rail yard employees could help us care for!
Cat Whisperer
This is a classic example of the difficult balance communities face between economic revitalization and preserving local character. While a data center would bring significant investment and jobs to a brownfield site, it’s understandable that residents are wary of a large, industrial operation with major demands on power and water, but little of the street-level vitality a more mixed-use development might provide.
Given the immediate opposition, what specific community benefits—such as a guaranteed payment in lieu of taxes for local schools, a binding commitment to green energy, or local hiring quotas—would the developers need to put on the table to make this proposal more palatable to skeptical residents?
A data center project is unlikely to create more than a few permanent jobs, and as a for-profit business, it would be fully taxable. There’s no reason to grant a PILOT.
There is a lot of space down there. They should build a solar power bank to supply some of their electricity needs.