Kotek Data Center Freeze Halts 20 Oregon Highway Fiber Projects

Twenty state right-of-way permit applications are currently on hold in Oregon, a move stemming directly from an executive order targeting data centers. The Oregon Department of Transportation suspended these permits to investigate whether the underlying infrastructure projects serve the sector the governor seeks to restrict on public land.

Gov. Tina Kotek issued an order in September directing state agencies to pause approvals for new or pending leases, easements, and permits for data centers on state properties. While the order targets data centers, it has created uncertainty for telecommunications companies building fiber-optic networks. These networks are typically buried along state highways and often connect to data processing facilities.

The transportation agency placed the 20 applications on hold to verify if they are "specific to data centers." Agency spokesperson Kevin Glenn noted that officials have limited insight into the full purpose of the projects. Glenn stated that the agency did not set a deadline for companies to respond to inquiries, adding that "the timing is dependent on the proposers."

The paused permits belong to three major fiber-optic companies: Zayo Group Holdings, Lumen, and Intermountain Infrastructure Group. These firms operate large-scale underground cable networks across the West. Glenn wrote that the proposed applications involve installing large amounts of buried broadband or fiber conduit on state right-of-way, which "strongly indicated a potential connection to data centers."

Zayo, based in Denver, completed a 622-mile long-haul route in 2025 connecting Prineville and Umatilla to Reno. The state paused nine of Zayo's permits. These permits cover cable laying along highways from Morrow to Multnomah counties and between Wheeler and Clackamas counties.

Lumen, which owns six data centers in Oregon including locations in Portland, Eugene, and Bandon, has nine permits on hold. These permits allow the company to lay underground cables from Wasco to Umatilla, Baker, Lincoln, Linn, and Malheur counties. Intermountain, a California-based firm, does not own data centers in the state but paused two permits for expansion into Umatilla County as part of a Pacific Northwest corridor project slated for completion this year.

Representatives for the three companies have not responded to requests for comment over the past two weeks. The Data Center Coalition, an industry group, criticized the pauses as burdensome to companies following state rules. Khara Boender, the coalition’s West Coast director of government affairs, said in a statement that pausing agency work midstream sends a concerning signal to companies weighing long-term investment.