Council Approves Disbursement Of Data Center Permit Fees

By Editor | April 14, 2026 |

by Janice Penix

The Clarksville City Council approved the disbursement of over $2 million in permit fees from the data center project to various city departments during its monthly meeting Monday, April 13.

Mayor David Rieder told aldermen that city staff members met to determine the areas of greatest need, and the resulting proposal would help to replenish areas in need of additional funding.

A total of $2,090,375 in one-time permit fee revenue was paid by Serverfarm for the construction permit on the first phase of the hyperscale data center.

The money was disbursed as follows.

–Street improvements, $1 million. This allocation will support road maintenance and improvements impacted by increased construction traffic and long-term infrastructure demands. Mayor David Rieder explained the street improvement fund was utilized to complete the baseball complex construction.

–Aquatic maintenance, $500,000. These funds will address ongoing maintenance, repairs and operational sustainability of aquatic facilities.

–Police maintenance (tornado sirens), $340,000. This money will fund upgrades and maintenance of the city’s tornado siren system, enhancing public safety and emergency preparedness.

–Parks improvements, $170,000. This allocation is an investment in park infrastructure, amenities and deferred maintenance needs.

–General fund, $80,375. This allocation will offset administrative costs and provide flexibility for other operational needs associated with the project.

In a memo to the Council, Reider said the proposed distribution of funds ensures the fee revenue is allocated in a manner that addresses direct and indirect impacts of large-scale development; prioritizes public safety and essential infrastructure; supports quality-of-life amenities for residents; and maintains a balanced and responsible approach to one-time revenue.

Alderman Eddie King said he would like to see a portion of the funding put into reserves, to help recover the reserve funds that have been tapped to meet budgetary needs,

“I don’t have any problem with us spending some of that money, but I’d like to see $1 million put in our reserve funds, to cover what we’ve already taken out,” King said.

Alderman Christel Thompson agreed.

“We have cashed in a CD recently, and we have spent a lot,” she said. “I would like to see some of this saved. I agree that we do need to put some things back into streets and aquatics, but I think we need to save some money.”

Rieder said the funds should be used now.

“There’s a fine line,” he said. “We’re a service organization. The money you bring in, you’re supposed to be using for services in the community, versus stockpiling money and using it to make money.

“Because we do have the need, and we do have it in reserve, I’d suggest we go ahead and spend this money, as opposed to putting it back when we have $5 million in reserve.”

King said he was concerned about having enough in reserves in the event of a disaster such as a tornado.

“I’d still like to see us save a little bit,” he said. “If we put a million in surplus, we can always take it out. We’ve drawn from the surplus for years.”

City Inspector Cody Graham said the permit fees are charged based on the city’s planning and zoning code, utilizing a formula based on the size and value of the structure under construction. The same formula is used for any building project, Graham said, and no discount or reduction in fee was provided to Serverfarm.

Rieder said any variance from the fee established by city ordinance would need to be approved by the Council.

Graham told aldermen the $2 million in permit fees represented only the fees paid for the first phase of the data center project, which includes four buildings. Other future development is planned, he added, and additional revenue will accompany that in the form of permitting fees.

The disbursement of the permit fees was approved on a 3-2 vote, with King and Thompson voting no, and Aldermen Patrick Baker, Ed Bradley and Rob Risinger voting yes. Alderman Robert Thompson was absent.

South Park Lawsuit Settlement

Aldermen approved a settlement agreement between Tyson and the city for a settlement in a federal lawsuit with Southpark Development LLC, and Dean and Karen Hammons.

City Attorney Clay McCall said the lawsuit related to the installation of a replacement force main line for Tyson under Southpark properties in 2021 and 2022. McCall said under the settlement agreement, Tyson will reimburse the city $44,167.85 in attorney fees. The city will in turn release Tyson from any past, present or future claims or expenses related to the lawsuit or the installation of the line.

The Council approved the allocation of the $44,167.85 from professional services and authorized Rieder to enter into the indemnity agreement with Tyson. Robertson, Beasley, Shipley and Robinson, PLLC, of Fort Smith was the law firm retained by the city in the case.

Other Matters

–The Council approved the payment of a $1,857.50 settlement to Lydia Summerlin, for damages to her vehicle sustained when it was driven through an area of Interstate Drive where drainage work was underway.

–Council members approved the nominations of Matt Bewley and Somphone (Josie) Lee to the Planning and Zoning Commission to fill two vacant positions.

–An ordinance was adopted approving the final plat of Drake Estates Subdivision, Phase II, and accepting the dedication of the streets within the development. Developer Travis Horn said the subdivision includes R-1, or single-family residential, homes.

–Aldermen approved an ordinance amending the city zoning code regarding signs, to allow one additional freestanding sign on qualifying double-frontage lots near I-40.

–An ordinance waiving bidding requirements and approving a sole source procurement for tasers, body cameras, in-car video systems and associated digital evidence storage services for the police department was approved. Police Chief David Smothers said Axon Enterprise, Inc., is the current provider of the department’s technology platform, and the contract of $201,772.86 for the equipment and services will be paid through the police maintenance fund.

–The Council allocated $4,500 in community projects funds for animal control office software.

–An adjustment to the 2026 budget of $5,815.62 was approved for the final payment to HTW Architects for the multi-purpose building design. City Clerk Lisa Venson said the project was completed in 2025, but the final invoice was not received until March.

–Council members approved the allocation of $10,913 from the aquatics maintenance fund for retirement contributions for three part-time employees.

The recording of the meeting may be viewed here.

Read this story and others in the April 15 issue of The Graphic, available online and at businesses throughout Franklin and Johnson counties. Subscribe or donate here to support more hometown journalism.