Northern Va. Big Deal: Digital Gateway lawsuits head to appeals court

When the massive Prince William Digital Gateway data center project was approved by county supervisors in December 2023, the project was hailed by some as an economic boon that could support 30,000 new construction jobs and infuse more than $500 million in annual tax revenue in the next two decades.

Others saw the project as a looming catastrophe, an economic boondoggle that would fail to deliver on its promises while leaving a blight on the western edge of the county, where the 2,100-acre project was approved along Pageland Lane bordering the historic Manassas National Battlefield Park.

Foes of the project promised to fight, and they have.

Billed as the world’s largest data center corridor and a rival to Loudoun County’s Data Center Alley, the Digital Gateway remains tied up in legal wrangling, and its future appears unclear.

The Digital Gateway would add as many as 23 million square feet of data centers to the county and is considered the world’s largest data center project. As of June 2024, Prince William had 9.17 million square feet of data centers in operation and about 3 million square feet under construction, and the county brought in $166 million in tax revenue in fiscal 2024, a 50% increase over fiscal 2023. By comparison, Loudoun has about 43 million square feet of data centers in operation or under construction, and that county is projected to bring in $1 billion in tax revenue in fiscal 2025.

Overland Park, Kansas-based QTS, one of the Digital Gateway’s two developers, declined to talk about its timeline for construction. Dallas-based Compass Datacenters, the project’s other developer, did not respond to an email.

The Northern Virginia Electric Cooperative, or NOVEC, also declined to discuss specific details about the work it must complete on behalf of the project, saying only that it is working with the developers to finalize all its substation locations, which will determine transmission line requirements. Dominion Energy, which will engineer and construct those lines, deferred questions about those needs to NOVEC.

The county board’s approval to rezone land for the project took place during a lame-duck session after the November 2023 elections. Its then-chair, Ann Wheeler, was voted out over her support for the project, and more than 200 people spoke during a marathon meeting that went past midnight. After the vote, a couple of dozen landowners and the American Battlefield Trust went to court, filing multiple suits against the county. One suit claimed the board failed to adequately notify the public about the hearing, and a second challenged the adoption of a comprehensive plan amendment that paved the way for the project.

Last fall, county circuit court judges dismissed the lawsuits, but plaintiffs are turning to the Virginia Court of Appeals, which they hope will block the development. A decision by the court in each case is pending.

Chap Petersen, a former state Democratic senator and an attorney representing plaintiffs in the American Battlefield Trust lawsuit, points out several flaws with the county supervisors’ vote to approve the project, including a recommendation by Prince William planning staff that the body deny the Digital Gateway because the developers’ application lacked critical information.

For now, the project appears stalled while legal wheels turn. That includes the sale of land to developers, angering some homeowners who had planned to sell, Petersen says. QTS previously told Virginia Business that about 100 homeowners joined together to sell their land for the Digital Gateway.

“The issue is that the rezoning is not final until they get all the way through the appeals process,” Petersen says. “So, they [developers] don’t want to buy the land because it may turn out to be worth a lot less than what they expected.”

Trevor Johnson, Prince William’s deputy director for economic development and tourism, says the county is focusing on attracting industries including life sciences and technology, and is not actively courting data centers. He would not speculate on the economic impact should legal battles lead to the Digital Gateway’s dissolution, and was not aware of any construction timelines.

“All along, it was a 15- [or] 20-year project, and so I wouldn’t even know if it’s considered a delay or not, or if this is kind of the timeline,” Johnson says.