Tucson City Council Pulls Plug on Amazon's Project Blue Data Center

Tucson city leaders unanimously voted to halt discussions with the developers of a massive planned data center on the Southeast Side, and continue to implement a policy regulating such sites. "We're done with Project Blue," said Councilmember Karin Uhlich.

Over the last few weeks, city officials have faced withering criticism over Project Blue's plans, a furor that grew during a trio of public meetings—including one online over Microsoft Teams, and two in-person meetings at which crowds of 800–1,000 wielded signs and catcalls, while urging the city to vote against the annexation.

Wednesday's meeting was the City Council's first public discussion of the proposal — and likely the last.

Before the vote, Beale Infrastructure's plans for Project Blue appeared already on the ropes after Councilmembers Kevin Dahl and Paul Cunningham said they would vote against it. On Tuesday, Uhlich also came out against Project Blue.

The meeting saw Mayor Regina Romero propose that the city continue to develop a set of regulations focused on any future data center developments, which was first discussed in June. That was adopted unanimously by the rest of the Council.

Uhlich then moved to end all further discussions with the developers of the Amazon-linked data center project, and curtail the nascent legal process of annexing the site into the city in order to provide it with Tucson Water service — a motion that Dahl had first announced he was prepared to make at the meeting.

The 7-0 vote effectively kills the June agreement for Pima County to sell the plot near the County Fairgrounds to the developers, as that deal is contingent on the annexation and water service being provided.

During the first in-person public information session, city officials and representatives of Beale Infrastructure repeatedly tried to assuage concerns about the $3.6 billion project during a two-hour meeting. They later made a more refined case during an online hearing using Microsoft Teams, where they again faced sharp questions about the project.

The project could have generated $250 million in tax revenue, and created 3,000 temporary construction jobs, along with around 180 permanent positions earning an average of $64,000 per year, the developers claim — although their contractual commitment was only to hire 75 workers.

Last month, city officials released details about the project showing the pair of data centers proposed for Tucson would use more water than four golf courses when fully built out, and be energized with more power than any other Tucson Electric Power customer.

The initial project, on the Southeast Side, would have required annexation into the city to procure the massive amounts of water required to cool the planned operation. Another associated data center was being planned for a different location somewhere within the city limits, officials said.

A third site was being studied for yet another data center in the region, but outside of the city limits, the city's released documents said. The city posted the documents and a message from Thomure on a "Project Blue — Facts and Information" section of its website.

Just the first two sites combined would have required nearly 2,000 acre-feet of water per year, which would have made them Tucson Water's largest customer.

According to Tucson Water, most single family homes here use an average about 7,500 gallons per month. That means that a full build of just the first phase of Project Blue would have used as much water as 3,149 average single-family homes in Tucson, and the second phase would have used as much water as another 3,765 homes.

City officials repeatedly said the project would be "net water positive" because the developers would invest in projects to conserve or "secure" new water resources to "offset their consumptive use, gallon-for-gallon."

During the first two years, the project would use drinking water for cooling, but would then switch to reclaimed water. "This initial use of potable water will be replaced – drop for drop," city officials said.

City officials have said the reclaimed water supply is about 32,000-acre feet per year,  including 22,000 acre-feet recovered from the Tucson Airport Remediation Project—which is removing PFAS chemicals from nearby wells. Around 40 percent of the current reclaimed water supply is available for use, and Project Blue had promised to build a pipeline to use reclaimed water.

"I do not favor proceeding with the Project Blue annexation because I think we (and Pima County) need to tackle the substantial work above first, before zeroing in on one entity and one project proposal," Uhlich said Tuesday, before the Council meeting.

Uhlich's statement came just as Lee announced the facilities would be in the Tucson metropolitan area "regardless of what the city of Tucson decides" after Beale Infrastructure outlined a plan to build in other communities if city leaders denied their annexation, including Marana, Oro Valley, Sahuarita or Green Valley. They could also build in unincorporated Pima County, or on federal land, the developers told her.

Meanwhile, Romero outlined her plan to manage data centers and review the regulations that guide their operation in Tucson. This includes "potential amendments to plans and policies regarding land use" for data centers, including a review of  regulations which align with the climate goals outlined in the city's plan "particularly energy use, our goal of carbon neutrality by 2045 and heat mitigation efforts."

Romero said she wants to make sure Tucsonans "have a chance to hear directly from the developers, TEP, and Tucson Water." 

"I’ve learned there is a gap in our existing city policies regarding data centers in general," she said, adding she wants Thomure to present regulations and policies which will "make sure that we have guardrails in place to provide the greatest protections to our residents, our water, and our desert, when it comes to data centers.

"The Phoenix area already has around 144 data centers, but none faced the same public outcry," she said.

Lee said she "dug deep into what Ward 4 residents want." 

"I made phone calls to everyday folks who don't have the bandwidth to do the level of research and engagement that many of you all have, because I really wanted to know across the political spectrum—what do folks in Ward 4 want me to do?" 

She said residents did not support the project.

"Project Blue represents a lot of things to a lot of people right now, more than just the data center and the project itself," she said. "It's a distrust in government. It's a distrust in corporations. It's a very large distrust in tech companies, a distrust in technology and privacy in general, and a fear of artificial intelligence and how fast things are moving and how little control we have."

Lee added while Arizona and local governments across the country have created "massive tax incentives to attract data centers" to attract data centers this "needs to go away."

Dahl said there were "some incentives that would have been pretty cool," but added there should "be much better ways of us to get those incentives and have industries that are much more sustainable."

Cunningham noted he has been against the project since the beginning of July, and hinted at potential support for "public power." Earlier this year, the city considered, but then abandoned a plan to purchase Tucson Electric Power.

Councilmember Lane Santa Cruz said she's been talking to constituents about Project Blue through the summer.

"Part of our responsibility is to do our due diligence, to ask hard questions, investigate thoroughly, and hold space for public input when you developments like this data center," she said. 

The Ward 1 Democrat thanked Lee for asking critical questions, and said she spoke with elected officials in other cities who've dealt "with the aftermath of similar developments" and national experts in "AI data infrastructure to understand what's truly driving this push." 

"What I've learned is simple, giant corporations prefer to operate in the shadows," Santa Cruz said. "Tucson is not for sale." 

"What's happening here isn't unique to us," Santa Cruz said. "Cities across the country are being sold the same story, promises of jobs, innovation and progress, but what's not being talked about is who really benefits and what it will cost us." 

Noting that the Trump administration has pushed hard for so-called AI and that was linked by "billionaires and tech bros," Santa Cruz added under the president's executive orders, the federal government could double-down on fossil fuels and nuclear energy to power these facilities, and could hinder efforts to regulate "AI."

"That's the direction this industry is headed," Santa Cruz said. "So let's be real, these data centers aren't being built to uplift our communities. They're being built to serve private profit and government surveillance." The facility will be used to store data for U.S. Immigration and Customs Enforcement, and expand "predictive policing" which she said are "systems that already harm our communities." 

"We're told this project will bring jobs and prosperity, but our people know, if it sounds too good to be true, it probably is. Construction jobs might come, but they leave as fast as they arrive," Santa Cruz said. "And the reality is, data centers require very few long term workers. This won't bring good-paying jobs, dignified jobs people actually need in this community."

The company behind Project Blue has remained a closely held secret, wrapped in a series of non-disclosure agreements, however, documents mistakenly released by Pima County showed that Amazon Web Services—the division of Amazon that backs much of the modern internet—was the final customer.

Citing the requirements of the NDAs, government officials and the public representatives of the developers have repeatedly refused to state that Amazon was behind the massive Tucson project.

But Wednesday, Councilmember Rocque Perez mentioned the company by name during the meeting, in an apparent confirmation that Amazon would be the entity using the series of data center complexes.

"I now urge Pima County and our counterparts in other municipalities — as well as the public that's here today — to pay attention to what happens next, because data centers aren't going away," the Ward 5 Democrat said.

"I know that Amazon Web Services in particular is much more water-consumptive," he said.

Romero said, "We have to work together to push the status quo and question not just your mayor and Council, which you have every right to do, but our Board of Supervisors, our state, our governor, our Congress and our president."

The mayor called executive orders from the White House pushing so-called "AI" companies "scary, really scary, in terms of the preemption of local jurisdictions, funding, withholding of local jurisdictions, that pushes back on AI and data centers, streamlining of environmental regulations." 

"We have a lot of homework, we have a lot of work to do, and I really expect your energy and your passion that you brought to this continue as a community," Romero said.

She told the crowd to continuing paying attention and hold city leaders accountable.

"We understand we are your front-line jurisdiction—that you have the easiest way of communicating—but Board of Supervisors and their team also should have stopped this right there," Romero said.

Following the vote, Beale Infrastructure's team grabbed their belongings and headed out a side door while the crowd cheered and hugged. One woman walked toward Romero and the rest of the Council and thanked them for their decision.

The No Desert Data Center Coalition praised Wednesday's vote, calling it a "huge victory for our desert community and would not have happened without thousands of Tucsonans coming out to vehemently oppose it." 

"We thank the mayor and Council for standing strong and not folding to Beale’s intimidation tactics and greenwashing propaganda," the group said. " Tucson made the right decision to halt Amazon’s harmful data center in its tracks and protect our water, air and a liveable climate." 

"We will remain vigilant because we know big corporations like Amazon, Beale and TEP have a hard time taking no for an answer and we are committed to stopping any data center they try to force on us within our watershed," the group added.