On the evening of May 4, the three members of the Box Elder County Commission approved the largest development in county history from a separate room.
They had tried to hold the meeting in person, at the county fairgrounds. The crowd booed a manager from the Bear River Water Conservancy District when he said the local community does not rely on the water in question. It jeered the outside attorney the county hired to explain the economic incentives. After about 30 minutes of shouting and chanting, the commissioners walked out. Their feed appeared on a projector screen. They finished the meeting virtually, and the audience watched the approval arrive by livestream. Commissioner Lee Perry explained that the vote was not for or against the data center but "about personal property rights."
The vote, by Perry, Commissioner Boyd Bingham, and the commission chair, was unanimous. The county announced the same day that it had authorized MIDA to initiate the Stratos Project.
What Was Approved
The Stratos Project is a 40,000-acre data center and energy campus planned for Hansel Valley, a remote stretch of northwestern Box Elder County at the top of the Great Salt Lake watershed. It is a joint venture between O'Leary Digital, the technology investment arm of Shark Tank's Kevin O'Leary, and West GenCo, an energy infrastructure firm, in partnership with the Military Installation Development Authority, a state entity known as MIDA.
The numbers are without precedent in Utah. The campus would be accompanied by up to 9 gigawatts of on-site power generation, fueled by natural gas. That is more than double the electricity the entire state of Utah uses. The footprint is roughly the size of Washington, D.C. The master plan, designed by architecture firm Gensler, depicts 60 data center buildings across six sites, plus a 3,000-acre solar array.
The pitch: backers say the project would fund modern facilities at Hill Air Force Base, generate all of its own power, clean its water and send it to the Great Salt Lake, create 2,000 high-paying jobs, and keep the United States competitive with China in artificial intelligence. The land, currently the privately owned Bar H Ranch, was divided into three sites: one for a large natural gas power plant and the data center, two reserved for later development such as manufacturing, retail, and hotels.
Today, the land holds sagebrush and grazing cattle. It holds very little water. The State of Utah has known this for 55 years.
The 1971 Report
In 1971, the U.S. Geological Survey, working with what is now the Utah Division of Water Rights, published a hydrologic study of Hansel Valley. The state still hosts the document on its own servers. Its conclusion is one sentence: "The estimated perennial yield of ground water in Hansel Valley is negligible."
The report found the valley's groundwater ranges from slightly saline to briny, that all of it is very hard, that little of it is suitable for public supply, and that about half the area yields water fit only for livestock. Future development, the state's hydrologists wrote, would probably look like past development: stock wells.
The developers tell a different story. MIDA says the project holds 13,564 acre-feet of water under contract, 2,864 in Hansel Valley and 10,700 near Snowville. That is more than 4 billion gallons. Stratos Project Area director Hilary Venable says the campus will use far less: a worst case of about 2,185 acre-feet per year, falling to between 500 and 1,100 once a closed-loop cooling system is running.
Here is what the record shows. Two water rights applications have been filed for the project. Both were withdrawn after Utahns filed thousands of protests. MIDA emails obtained through a public records request confirm that environmental studies have not been done. Venable wrote that studies will be required as part of the master development plan review. That review has not started.
Scientists have raised a second concern. They estimate a campus drawing 9 gigawatts would also release 7 to 8 gigawatts of waste heat into a closed valley that drains directly into a shrinking Great Salt Lake.
The Approval Path
The project never went through Box Elder County's ordinary land use process. It went through MIDA.
MIDA was created in 2007 to develop land near military installations. Its other projects include a data center at Camp Williams and military recreation housing. It enters an area only with local consent. Once inside, it holds local government authority to manage land use and issue bonds. Its board is appointed, not elected. On April 24, the board approved the Stratos Project Area, including property tax relief for the developers. Ten days later came the vote in Tremonton.
O'Leary Ventures hired lobbyists Casey Hill and Lincoln Shurtz of Lincoln-Hill Partners to make its case. Hill once managed an election campaign for Utah Senate President Stuart Adams. Adams sits on MIDA's board.
The Money
How does a 40,000-acre, 9-gigawatt campus get paid for? The honest answer is that nobody, including the developers, fully knows yet. But the pieces on the table can be counted.
Start with what has actually been spent. The developers have invested around $20 million to date, CNN reported. That money covers land work, planning, and the political effort. It is real capital. It is also two hundredths of one percent of the full buildout, which will likely cost investors more than $100 billion by the time it is finished.
The early phases alone are enormous. Representatives of O'Leary Digital told Utah Money Watch that the company expects to spend more than $1 billion on site preparation alone, more than $4 billion on a 500-megawatt Phase 1, and close to $20 billion to scale to 3 gigawatts in the early phases. Those figures track with the market. When Utah's Novva Data Centers secured a $2 billion construction loan for its South Jordan campus, the financing worked out to roughly $11.4 million per megawatt, which would put a 500-megawatt first phase near $5.7 billion. O'Leary himself, in an interview with ABC4, described his exposure as a $15 billion investment carrying considerable risk, while insisting money is not his motive: "I don't need any more money."
Then there is the public side of the ledger. MIDA is what Utah State Auditor Tina Cannon calls a "super" special district, with city-like powers, including bonding, land-use authority, and tax increment capture, meaning it can keep the new property taxes a development generates and spend them on the development itself. In its Deer Valley project, MIDA has redirected 75 percent of new property tax revenue away from schools and county services for up to 40 years to fund infrastructure. For Stratos, MIDA approved a series of resolutions agreeing to charge lower taxes in a bid to help "lure the hyperscalers" such as Amazon, Microsoft, and Google. Elevate Utah, a newsletter aligned with project opponents, reported the specifics: an energy-use tax cut from 6 percent to 0.5 percent and a property tax structure that returns 80 percent to the developer. In exchange, Box Elder County is projected to receive $30 million in new annual revenue during the project's initial phases and up to $108 million at full buildout. The developers will also pay rollback taxes when the farmland loses its greenbelt status, and will fund road improvements and traffic studies.
So the structure is this: private capital builds, public tax policy subsidizes, and MIDA's bonding authority sits available in the background. What the structure does not yet contain is the thing every data center is built on.
The Tenant Problem
A data center is not financed like a ranch or a strip mall. Lenders do not write multibillion-dollar construction loans against empty buildings in a desert. They write them against leases. The standard path is an anchor tenant, usually a hyperscaler or a government agency, signing a long-term commitment that converts a speculative site into a predictable revenue stream, the debt can be priced against.
Stratos does not have one. The developers plan to seek letters of intent from potential tenants, and O'Leary told CNN that the facility would aim to serve clients engaged in national defense work, such as the U.S. government or its tech contractors. He says the project will support around 10,000 construction jobs and 2,000 permanent positions. But project filings name no anchor tenants, and none of the major cloud providers, Amazon Web Services, Microsoft Azure, or Google Cloud, has publicly committed to leasing space. He acknowledged to ABC4 that a developer cannot know what a project will earn until it is operating with a tenant.
The capital gap is the comparison that matters. The Stargate project, the largest announced AI infrastructure effort in the country, spreads its $500 billion commitment across OpenAI, Oracle, SoftBank, and a list of institutional co-investors. Stratos has a two-firm joint venture. Whether equity partners, sovereign wealth funds, or federal contracts close that gap is the largest open question of the project's viability. As it stands, $100 billion describes what the project could cost. It does not describe money anyone has committed.
The case for the money showing up is also real. The four largest hyperscalers are expected to spend upwards of $725 billion combined this year on AI infrastructure, by Goldman Sachs and Morgan Stanley estimates. Capital is chasing exactly this asset class. O'Leary has a smaller sister project, Wonder Valley in Alberta, that uses the same design team, which he cites as proof of concept. And the phased structure lowers the bar: the project does not need $100 billion to break ground. It needs roughly $5 billion and one signed tenant.
But the same forces that shrank the project also raised its cost of capital. Lenders price political risk. A project facing a constitutional lawsuit, a year or more of permitting, unsecured water in a valley the state declared dry, and a governor who says his own order could delay it is a harder loan to write than the same project without those facts. Analysts watching the sector have started saying the real bottleneck for AI infrastructure may not be chips or electricity but public tolerance. Stratos is their leading example.
The Backlash
The opposition came from places that do not usually agree with each other. Deeda Seed, a campaigner with the Center for Biological Diversity, was among thousands of Utahns who voiced opposition to the project. Residents organized as the Box Elder Accountability Referendum and filed two applications to put the project to a public vote. County Attorney Stephen Hadfield denied both; the organizers plan to appeal.
O'Leary responded on national television. On Fox News, he accused two Utah opposition groups, Alliance for a Better Utah and Elevate Strategies, of being funded by a foreign adversary: "There's only one. It's China."
Gov. Spencer Cox initially defended the project. At his April 30 press conference, he said, "I'm so tired of our country taking years to get stuff done" and argued that if a data center could not be built in remote Box Elder County, it could not be built anywhere. Emails obtained by The Salt Lake Tribune later showed Cox had known about the proposed data center for months before taking any public action.
Four weeks changed his position. On May 29, Cox signed Executive Order 2026-03, establishing a statewide framework directing agencies to protect water resources and the Great Salt Lake, safeguard air quality and utility ratepayers, mitigate wildlife impacts, and ensure transparency in approval processes. He told reporters the order came in response to public pressure and could delay the project. He signaled a possible special legislative session in September to change state law on data centers.
Opponents question the order's reach. Brenna Williams of the Box Elder Accountability Referendum believes MIDA itself is exempt from it. Utah Department of Environmental Quality Commissioner Tim Davis confirmed in the same report that air and water quality permitting for the project is at least a year away.
The Reduction
On June 1, Adams sent O'Leary a letter demanding a 75 percent reduction in the project area, from 40,000 acres to roughly 10,000, plus water commitments to the Great Salt Lake, land conservation, heat mitigation, and environmental performance standards.
O'Leary agreed in three days. In a June 4 letter, he committed to cut the project area to about 20,000 acres, with roughly half preserved as open space, leaving a developable footprint of about 10,000 acres. He agreed to remove more than 19,000 acres near the Locomotive Springs Waterfowl Management Area, to direct excess water shares to the Great Salt Lake, and to publish project details on a public website. Adams announced the concession the same day, noting that the project remains in its earliest stages, with full permitting and environmental review still ahead.
Then O'Leary apologized. In an interview with ABC4, he admitted he "screwed up" the rollout and said he should have addressed environmental concerns from the beginning. He now favors building in phases, starting small so the public can judge the jobs, water use, noise, and heat before anything larger rises.
The reduction affects the financial math less than the acreage would suggest. The first phase was always going to be small, covering fewer than 2,000 acres under the initial permit. Cutting open space does not cut the cost of the buildings, the turbines, or the fiber. What the reduction bought was political room. Whether political room attracts capital is the experiment now underway.
The Lawsuit and What Remains
Last Wednesday, the Alliance for a Better Utah and five anonymous Box Elder County residents filed suit in Utah's 3rd District Court, seeking a permanent injunction to block the Stratos Project Area Plan. Their attorney, David Irvine, put the claim plainly: "Backroom deals and pay-to-play have no place in Utah government."
The legal theory extends beyond one project. The plaintiffs argue that MIDA is exercising lawmaking power over public health, safety, taxation, and land use as an unelected body that the Utah Constitution never authorized. The suit names Adams and state Sen. Jerry Stevenson, both sitting legislators who serve on MIDA's board, and argues their dual roles violate the prohibition on holding more than one office of public trust. If a court agrees, the ruling would touch every MIDA project in the state, from Camp Williams to military housing. MIDA says it is reviewing the lawsuit. Box Elder County says it has not yet been formally served.
Beyond the courtroom, the project faces gates it has not yet approached. The land use approvals were the easy part. The binding ones remain: water rights in a valley the state declared dry in 1971, air and water quality permits at least a year out, a master development plan that has not been submitted, a tenant that has not been signed, roughly $5 billion in first-phase capital that has not been raised, and whatever the Legislature does in September.
The Stratos Project is half the size it was a month ago, on paper. The water has not been secured. The studies have not been done. The money, beyond $20 million, has not arrived. The lawsuit has just been filed.
In Hansel Valley, the cattle are still grazing.
