The City of Independence, Missouri, is being sued by residents after it refused to approve a referendum petition that would have challenged tax incentives for a 800MW Nebius data center campus.

The Independence City Council approved a series of measures in early March relating to the campus, including: two series of Taxable Industrial Development Revenue Bonds totaling around $150 billion; a 98 percent real property tax abatement and a 90 percent personal property tax abatement lasting for twenty years; and a sales tax exemption on construction materials.

Residents angry at the decision attempted to file a referendum petition, which would put the city council’s decision to a public vote.

But a referendum petition first requires the approval of the city, which declined to offer it early last week on the grounds that the city’s charter did not “permit a referendum on this specific matter, and approving a petition for circulation would be in violation of the Charter,” said a spokesperson for the city to radio station KCUR.

A referendum petition “can be used by voters to reject any ordinance passed by the City Council, except for ordinances which… go into effect immediately,” said the City.

“Bill No. 26-019 related to specific contracts and did not state that it went into effect at a later time, therefore, per the City Charter, it went into effect immediately… Per the City Charter, because Ordinance No. 19791 went into effect immediately, it does not qualify for a referendum petition.”

The lawsuit, filed on Monday, is challenging this refusal, calling for City Clerk Susanne Holland to “perform her duty under the City Charter… and certify Relators’ Petition For Referendum in proper form.”

Nasdaq-listed Nebius is planning a 2.5 million sq ft (232,255 sqm) campus in the existing Eastgate Commerce Center, off Little Blue Parkway and Missouri Highway 78 in Jackson County. It bought the 398-acre land parcel from real estate firm NorthPoint Development in early December.

Up to ten buildings could be developed on 400 acres, and the campus will use a closed-loop cooling system.

Power would be drawn from a new facility developed by Independence Power Partners (IPP) at the retired Blue Valley Power Plant site. This is set to provide 250MW of capacity by October 2027, and 1.1GW by December 2029.

Nebius is a cloud provider focused on AI workloads. The firm was spun out from Russia’s Yandex in 2024, offering access to GPUs across its presence in the US, the Middle East, and Europe.