Lex Developments appeals Pocatello’s denial of application to build controversial AI data center

Lex Developments LLC, an Arizona-based company, has formally appealed Pocatello’s denial of its application to construct an AI data center at 1800 River Park Way, the former Hoku Materials Plant site. The appeal, filed by Idaho Falls law firm Parsons, Behle & Latimer, argues the city’s decision should be reversed on three grounds, including insufficient analysis of environmental and public welfare impacts. The Pocatello Hearing Examiner Kathleen Lewis initially denied the conditional-use permit, citing non-compliance in three of seven review criteria. Lewis stated Lex Developments did not adequately address power, water, wastewater capacity, or air quality impacts, nor did it demonstrate the project would not harm public health or safety. The examiner required further studies before reconsidering the application. Lex Developments counters that a conditional-use permit was unnecessary, claiming data centers are not explicitly covered under Pocatello’s zoning code. The company argues it should have been evaluated under the unlisted uses section, which does not require a public hearing. Attorney Jon Stenquist, representing Lex, asserts the city’s procedural error altered the project’s public perception and was legally flawed. The appeal now goes to the Pocatello City Council, which will decide whether to uphold Lewis’ denial. If the council rejects the appeal, Lex Developments will need to conduct additional studies—including power, water, and environmental assessments—before resubmitting its application. The company has not yet commented on next steps beyond the appeal process.