Kelowna Mountain lawsuit over AI data centre ‘premature,’ says regional district

The developer behind a planned Kelowna-area data centre had more options on the table before taking his zoning grievance to court, according to the Central Okanagan Regional District.

The regional district called the legal action over Kelowna Mountain “premature,” while at the same time asserting the plan wouldn’t conform to rural zoning on the properties just southeast of the city.

That’s according to the regional district’s legal response to the lawsuit, which was filed last month challenging staff’s initial refusal.

Kelowna Mountain Development Services Ltd. claimed the “private cloud-based” data centre and energy plant should fit regional district zoning as a “utility,” while describing a staff refusal as “procedurally incorrect.”

It would be the first AI server farm in Kelowna amid a booming tech industry, and the company, led by developer Mark Consiglio, claims it already has investors behind the project.

In its court response, the regional district said neither a data centre nor the power generation plant fit with current zoning as a rural property. It would have to be rezoned for industrial use, which has not been attempted.

How the power plant and storage would work on the property isn’t clear. The regional district described the company’s development application for both portions of the plan as “vague.” The regional district added that staff didn’t make any final decisions on the project and, even if it had, the developer could appeal the decision to the board of directors.

It also said there was no bad faith involved in the decision, which Kelowna Mountain claimed in the lawsuit. That harkens back to previous efforts to build on the property and legal actions.

Consiglio has attempted to build other projects on the sprawling set of three properties just off Gillard Forest Service Road. Previous iterations included a residential development and plans for a $100 million winery park complete with a ski hill, amphitheater, indoor vineyards and suspension bridges.

Before plans for the AI data centre, the vision evolved to include a recreational centre with rinks, pools and soccer fields.

What currently remains is an unfinished winery with suspension bridges and other unused attractions, while the effort to complete something on the properties left numerous lawsuits and a contentious relationship with the regional district in its wake.

Aside from previous legal challenges against the regional district, lenders and investors also sued Consiglio and, in recent years, Vancouver firm Tri City Capital Corp. won a bid to foreclose the properties over unpaid loans. But, it appears Consiglio managed to retain ownership.