The City Council of Chicago has passed an ordinance amending Chapter 2-68 of the Municipal Code by adding a new Section 2-68-050, which sets forth data residency requirements for City data. The ordinance defines "City data" and excludes certain types of information from this definition. It mandates that any contract for the storage of City data entered into after the ordinance's effective date must stipulate that the data be processed, stored, and disposed of within the United States, unless otherwise authorized by the Chief Information Officer. Additionally, the ordinance introduces an "earned credit" system, where qualified bidders can receive a bid preference of two percent for storing data within the State of Illinois outside Chicago's corporate boundaries, or four percent for storing data within Chicago's corporate boundaries, excluding City-owned data centers. These credits must be used within three years, cannot be combined with other bid preferences, and are subject to the Chief Procurement Officer's discretion and verification of compliance.

Furthermore, the ordinance authorizes the Chief Information Officer and Chief Procurement Officer to adopt rules for the administration and enforcement of the new section, including defining the term "data center." It also establishes an interdepartmental working group led by the Chief Sustainability Officer to review and recommend policies regarding the environmental and energy impacts of data centers in Chicago. This group, which includes representatives from various departments, must make their findings publicly available and present a report to a joint committee by December 31, 2025. The ordinance is set to take effect on January 1, 2025.