 Chair Scott's Statement Regarding Binding Memorandum of Agreement Houghton Data Center Project
TUCSON, ARIZONA - December 16, 2025– I want to recognize and thank the County Administrator and her team, as well as the County Attorney and her team, for negotiating this binding Memorandum of Agreement with the Beale Infrastructure team. Back when this project was being structured, it was planned and envisioned as the work of two jurisdictions. Some of what is outlined in this enforceable document was expected to be included in the development agreement between Beale and the City of Tucson. After the decision to deny annexation was made, Pima County was obliged to move forward in a way that sought to assure the public that the plans and assurances from the developer would come to pass as promised.
When we approved the land sale and rezoning in June, the original conception of the project made far greater use of both potable and reclaimed water than what we now see before us because the project at the time was aligned with the conservation and infrastructure plans of the city’s water utility. The Memorandum of Agreement commits the project to use “a closed loop system” that “operates by recirculating minimal quantities of water.” Any water usage on the site of the development will be approved by our state’s Department of Water Resources and must meet the requirements of the county’s Preliminary Integrated Water Management Plan.
Beale and Tucson Electric Power, given the significant amount of power that will be used on site, were required to submit an Energy Supply Agreement for consideration by the Arizona Corporation Commission. The terms of that agreement were being discussed by Beale and TEP even before the City of Tucson made its decision not to annex the property. It is important to recognize that the Energy Supply Agreement governs only the first of the three phases of this project and that there will need to be a new Energy Supply Agreement submitted for each of the next two phases. As this Memorandum of Agreement states, TEP will provide power to the project using “resources that are existing or under development.” There are also safeguards for other ratepayers and financial commitments that Beale must abide by that further protect the utility and its other users.
All this was already in place, but what this Memorandum of Agreement provides is a path forward for ensuring that Beale’s commitment to “match one hundred percent (100%) of its energy consumption with renewable energy” is met. Every year, an “independent and qualified third-party verifier” approved by both Beale and Pima County will confirm that “the Project has achieved the Renewable Energy Commitment.” This is a laudable and significant accomplishment and the people of Pima County should know that their representatives pushed hard for this independent verification of Beale’s commitments to renewable energy in our discussions with them.
From the beginning, one of the most compelling features of this project has been the economic benefits to the county and our constituents. They are also a prominent part of this document. Beale will pay the county close to $21 million for the sale of this acreage and the County Administrator must engage the Board in a wide-ranging discussion as to the best uses of those proceeds. The people we represent must see that we are using this money in ways that enhance our ability to deliver the services and supports they count on from us.
The $3.6 billion capital investment in this project is the largest of its kind in the history of our county and will have a positive, profound effect on our local economy. Just like the proceeds from the land sale, the increased county tax revenues ($58.8 million over 10 years) will be used in ways that benefit the public. There will also be greater tax revenues for local school districts and state government that will benefit their constituents.
Only one percent (1%) of the existing employers in our county provide more than the 180 full-time and permanent jobs that will be part of this project. Moreover, the more than 3,000 construction jobs that will result are not “temporary” as some have labeled them. Rather, they will be filled by our friends and neighbors in the building and construction trades who have devoted their careers to these professions. As we have heard, many of those Pima County workers currently travel many miles each day to other parts of the state to do their work.
There has been passionate and thoughtful opposition to this project, often based in legitimate concerns about how we make use of and govern the technologies that play larger roles in our lives. However, there has also been unduly alarmist and defeatist rhetoric deployed by some project opponents, calling into question our abilities as a community to balance economic development with environmental stewardship. Pima County has historically struck that balance and this agreement will help us to build on that proud record. We should approve it and hold both ourselves and the Beale team accountable for seeing that its terms are fully implemented.
Rex Scott
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