North Dakota Committee Rejects Bill Banning Industrial NDAs

A joint House-Senate policy committee in North Dakota recommended rejecting Senate Bill 2406 on Wednesday. The bipartisan measure sought to restrict public officials from signing nondisclosure agreements (NDAs) with industrial project and data center developers, proposing strict penalties such as the revocation of permits or zoning changes for companies in violation.

Governor Kelly Armstrong testified against the bill, arguing that existing open records laws are sufficient and warning that the restrictions could hinder the Bank of North Dakota's ability to hire consultants or evaluate investments. Supporters, including Senator Tim Mathern, argued the bill was necessary to prevent communities from being blindsided by large-scale projects, citing a case where Harwood residents only learned of an Applied Digital project six weeks before groundbreaking.

While the committee approved an amendment by Representative Jonathan Warrey to protect information already deemed confidential under state law, members ultimately recommended dismissing the bill. Some legislators cited the complexity of the issue for a three-day special session, while others disagreed on whether current transparency laws provided adequate enforcement. The bill now advances to the full Senate with a do-not-pass recommendation. Separately, a committee led by Representative Warrey is studying the impact of artificial intelligence and data centers for potential legislation in 2027.