Lawsuits seek court review of Project Jupiter funding

LAS CRUCES — Work crews have begun preparing the ground in Santa Teresa for a campus of data centers, offices and a power generation facility to be occupied by Oracle Infrastructure and OpenAI, a project anticipated to invest $165 billion over three decades.

As that work began, opponents of the project filed separate civil court petitions this week asking a state district court to review county ordinances enacted to support the financing of Project Jupiter, as the planned data center was nicknamed by developers.

Doña Ana County spokesperson Ariana Parra confirmed Wednesday that the county had been formally served with one of the lawsuits. “It’s the county’s policy to refrain from commenting on pending litigation,” she said.

The Empowerment Congress of Doña Ana County filed a petition in New Mexico’s 3rd Judicial District seeking judicial review of the legality of ordinances authorizing industrial revenue bonds and Local Economic Development Act funding developers had sought in support of locating the project in New Mexico.

Empowerment Congress is joined in the complaint by Jose Saldaña of Sunland Park, a volunteer with the nonprofit community organization, and Vivian Fuller of Santa Teresa, Empowerment Congress’ community program manager.

The petition claims that when county commissioners voted 4-1 to approve $165 billion in industrial revenue bonds supporting various phases of the project, they did so on the basis of incomplete applications, in violation of a county code saying IRBs may be issued “only after the county has been fully informed concerning the applicant and its current status and future plans.”

Blank pages, missing documentation and documents marked as drafts in support of the IRB ordinance, among hundreds of pages released days before the Sept. 19 public hearing and vote, prompted three unsuccessful motions by Commissioner Susana Chaparro to postpone the vote in order to gather more information. Ultimately, she voted no on the IRB as well as LEDA funding.

Empowerment Congress’ lawsuit also argues that Project Jupiter is not eligible for LEDA, a state grant program supporting economic development, because it does not fall under any of the qualifying categories, such as manufacturing, storage, distribution or selling of agricultural or other categories of products, or certain other kinds of businesses.

Commissioners approved a second LEDA ordinance supporting reduced building permit fees for the construction of Project Jupiter at their Oct. 14 meeting.

The project plans to build four data centers, business offices and a power facility generating electricity from natural gas plus a battery storage facility. The partnership between Oracle and OpenAI is leading a $500 billion national AI technology initiative for which the Santa Teresa facility is one of five gigantic computing facilities in development for training AI technology.

“The scope of the proposed project … does not fall into any one of the nine qualifying categories under (LEDA),” the petition claims, “and the Project will be, apparently, primarily supplying its services to a specific industry and more broadly to the general public, establishing the Project as a non-qualifying entity under the Act.”

According to the state Economic Development Department, LEDA qualification also extends to enterprises deemed “economic base employers” who would be eligible for state-funded in-plant job training.

A spokesperson for the EDD said Project Jupiter’s developers did not apply for LEDA funding directly from the state, but theoretically data centers generally qualify for the grants, in the department’s view. Meta’s data center in Los Lunas received LEDA grant money in 2016.

The complaint asks the court to declare the IRB and LEDA ordinances contrary to law and to vacate the county commissioners’ actions, citing concerns about the project’s potential impacts on regional water supply and air quality, among others.

In the run-up to the September vote, the Empowerment Congress had challenged the project on environmental grounds as well as the transparency of a process critics called rushed and secretive.

The industrial revenue bonds support the development through a series of leases for aspects of the project, with the county holding title and accepting direct payments instead of regular property taxes as well as commitments under a “community benefits agreement” that include millions of dollars in local investments.

The lead developers are BorderPlex Digital Assets and Stack Infrastructure, while the lease agreements are in the name of recently created subsidiary entities.

The complaint has been assigned to state District Judge James Martin. Further proceedings had not been scheduled as of Wednesday.

In a separate petition filed last week, also in the 3rd Judicial District, Derrick Pacheco of Las Cruces filed a petition for judicial review of the IRB ordinance on similar grounds, claiming that it was improperly approved while the project’s land-use authorization was still pending with the county’s Planning and Zoning Commission.

Pacheco also argues that commissioners made an “arbitrary” decision to approve the ordinance on the basis of missing documentation.

The case was initially assigned to state District Judge Casey Fitch, and no further proceedings were scheduled as of Wednesday.