Project Blue involves a proposed data center complex near the Pima County fairgrounds and another within city limits. Officials said this would become the top electricity and water user in the area. The proposal involved water allocation caps, but breaching those would result in extra charges rather than halting the project’s water use. In a city that has been facing persistent drought conditions, this raised concerns.
The project's development was led by Beale Infrastructure, but documents mistakenly released by Pima County showed that Amazon Web Services was the final customer, as reported by the Tucson Sentinel.
Members of the public voiced these concerns during a Project Blue Community Information Meeting on Tuesday, and officials faced frequent interruptions from the public, as shown in this video created with footage from the city of Tucson.
When one public commenter called on the council to put the future of this land to a public vote, the crowd erupted in chants of “Let us vote.”
During a Wednesday study session by the Tucson City Council and Mayor Regina Romero, their first formal discussion of the proposal, they voted unanimously not to consider it further.
“Tucsonans have spoken out strongly and clearly, and I hear you,” Romero said during the discussion.
In a press release, Beale Infrastructure said the city initially greeted the project “with enthusiasm” before voting against it. The company said it had “committed to replenish drop-for-drop via investments to develop new water sources.”
“We are disappointed in the decision not to pursue this opportunity for Tucson,” said Beale Senior Vice President of Development Brendan Gallagher in the statement. “We partnered closely with municipal engineering teams and Tucson Water to develop plans directly compatible with Tucson’s Climate Action and Adaptation and One Water plans. We see it as a missed opportunity for the city, as this project potentially represents tens of millions of dollars in tax revenue, hundreds of millions of dollars in infrastructure to serve the community and thousands of high-paying local and union jobs.”
City Council members voiced their own concerns about the project during the meeting.
They questioned the job creation benefits touted by Project Blue supporters. The project’s leaders had promised to create thousands of construction jobs to build the centers, and between 75 and 180 long-term data center jobs.
Council Member Lane Santa Cruz said that construction jobs are temporary, and that data centers require “very few” long-term employees. She argued that the data center project would not bring the kind of jobs needed in the community. The focus, she said, should instead be on water and energy.
“Headline after headline, city after city, we’ve seen how these facilities drain power and water,” she said.
Another council member, Nikki Lee, argued that in the AI race, officials need to consider where data centers should be, noting that people do not believe these centers should be established in the desert. Lee wrote in a newsletter Tuesday that regardless of the decision made by the city of Tucson, “Project Blue will be built in the Tucson metropolitan area.”
Her newsletter explained that the project has backup site options in the area, located on federal, state or unincorporated county land or in neighboring towns. These backup sites, too, she emphasized, are within Tucson’s watershed and within the Tucson Electric Power service area.
City leaders are now undertaking a regulatory approach to implement guardrails guiding future data center operations that could impact the community.
The council agreed to consider an ordinance on large water users at its Aug. 19 meeting.
However, Romero also underlined orders from the White House that could hinder federal funding to local jurisdictions that regulate AI advancement.
Although this specific data center project proposal was rejected, the mayor emphasized that does not halt the diligence required of city leaders to address future data center project proposals. “It doesn’t end here,” Romero said.
