Data Center Expansion Raises Questions About Transparency and Community Impact
*DOWAGIAC, Mich.* — Dowagiac Mayor Patrick M. Bakeman has released an open letter to Will Horne, CEO of Hyperscale Data, addressing serious concerns about communication, transparency, and the impact of the company's massive expansion plans on Southwest Michigan communities.
The controversy erupted after Hyperscale Data announced this week that it has reached an agreement to more than double its campus in Dowagiac, saying the need for artificial intelligence is exploding. The company, which specializes in AI and bitcoin mining, said it plans to support cloud computing with an expansion of more than 48 acres of land, with hopes to close the deal within the next 60 days.
City Caught Off Guard
However, City Manager Kevin Anderson told News Channel 3 on Tuesday that the press release was the first the city had heard about the land agreement, and that they have not had any contact with the company about their plans.
"We saw the press release like you did, that said they are looking to buy some additional property and hoping to close on some in the next 60 days," Anderson said. "We haven't had any contact with them about that."
This lack of advance notification has sparked outrage among residents who say they've also reached out to the company but have never been able to get answers.
Residents Speak Out
News Channel 3 called Hyperscale on Tuesday and were told by an automated line that someone would follow up. Residents living near the Dowagiac facility say they've reached out to the company, too, but have never been able to get answers.
Terry Raab, a resident living near the facility, told News Channel 3 that the noise has made him unable to open his windows in the summer and is worried about what it will do to his health.
"They also complained of the noise caused by the facility," Anderson said, referring to the residents who shared their frustrations with local officials.
The Scale of Expansion
Hyperscale announced last summer its intention to expand from a 30-megawatt to a 340-megawatt site, the power equivalent of tens of thousands of homes.
Anderson says the company doesn't use the city's electric utility, and that the city hasn't received any development proposals.
"After somebody closes, forms get filed with the city so that we can send the tax and utility bills to the appropriate place," he explained. "So, it would be very rare that we would hear something like this in advance."
Mayor's Open Letter
To address the lack of communication and transparency, Dowagiac Mayor Patrick M. Bakeman has released an open letter directed at Hyperscale Data CEO Will Horne.
The letter is as follows:
April 1, 2026
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Open letter to Will Horne, CEO, Hyperscale Data, Inc.
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In Dowagiac, we pride ourselves on our ability to create an environment in which both businesses and neighbors can be successful. I can cite many examples throughout Dowagiac where this is occurring. Our expectation has always been that your business, like the many previous businesses who have operated in our city, would communicate with us before announcing plans to the public.
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We are now in a position where the public has learned about your expansion plans through a press release, and not from our city. This lack of communication is concerning.
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We expect you to come forward with a plan that addresses the concerns of our residents, including the noise, the environmental impact, and the long-term sustainability of your operations.
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We look forward to working with you to ensure that both your business and our community can thrive.
Broader Pattern in Michigan
This situation reflects a growing trend across Michigan as data centers and battery energy storage facilities proliferate throughout the state. Major technology companies like Apple, Amazon, Meta, and a variety of AI companies use data centers to house IT infrastructure and process data.
Critics argue that data centers hurt local water supplies and drive up energy costs.
Meanwhile, battery energy storage facilities can store and provide electricity to a building or grid network to meet increased demand. Critics argue that BESS facilities pose the risk of runaway fires and clouds of toxic gas.
Portage recently paused battery energy storage systems and data center proposals during its meeting on March 24. The city hasn't seen any interest or applications for this kind of development, but it's a preemptive move that several Michigan cities are pursuing as interest ramps up.
Cass County Calls for Transparency
The lack of communication isn't limited to Dowagiac. Cass County leaders like Commission Chair Jeremiah Jones say Dowagiac residents have brought forward environmental and noise concerns, leading them to unanimously pass a resolution calling for a "clear regulatory framework."
"We're not against data centers and we're not pro-data centers," Jones said. "We just want transparency and what's best for the community."
The resolution from Cass County Commissioners calls for public disclosures on:
- How electricity will meet clean energy goals
- Daily water usage
- A plan for how residents won't be stuck with the bill if a project fails
The county sent this document to each of its municipalities, although Jones says the only data center development he's aware of is in Dowagiac.
What's Next
The Dowagiac situation continues to unfold as city officials, county leaders, and residents weigh in on what many see as a pattern of inadequate communication from data center developers.
Anderson emphasized that while the city has no power over the project itself, they remain committed to ensuring that any future developments are handled with proper transparency and community input.
"We have zero power, because the property is not zoned for anything other than industrial use," Anderson said. "But we're committed to making sure that our residents are informed and that their concerns are addressed."
As Hyperscale moves forward with its expansion plans, the question remains: will other Michigan communities follow Dowagiac's lead in demanding greater transparency from data center developers?