Pima County pledged 5 years of secrecy to Amazon on Project Blue, NDA shows

Pima County agreed to keep Amazon Web Services’ role in the Project Blue data center development secret for up to five years through a non-disclosure agreement it signed with the company in 2023.

The agreement said any “confidential” information about the project, including the company’s name, has to be kept secret for five years or until the project is completed, whichever comes first.

Under the agreement, the county can’t disclose any confidential information without Amazon’s consent. If the county receives a public records request for confidential information, it can disclose such information as required to meet open records laws. But it must give Amazon 10 days notice in advance of doing that, to let the company seek a protective court order barring its release, the agreement said.

While county officials have previously said a non-disclosure agreement was in place, the newly learned details of the agreement, first reported by news website AZ Luminaria, underscore the extreme secrecy surrounding the project that would place up to 10 data centers in a complex built on 290 acres on the far southeast side near the county fairgrounds. Little if anything was publicly known about Project Blue until a few details trickled out in late spring of this year.

The secrecy didn’t last five years, however, because this summer, County Administrator Jan Lesher released — mistakenly, county officials said — a separate 2023 county memo to AZ Luminaria that identified Amazon Web Services as Project Blue’s prospective operator.

The county also signed a separate non-disclosure agreement with other Project Blue financial backers in June 2024. That agreement, obtained by the Star, contained far more detail about what information must be kept secret. It was signed by a Delaware company calling itself IPI Management LLC.

The non-disclosure pact covers “all confidential processes, plans, formulae, data (including cost, real estate, and performance data), inventions, machinery, drawings, papers, writings, specifications, manufacturing or design procedures and techniques, methods, technology, know-how, programs, databases, source codes, devices and materials related to the business, products (either existing or under development), services or activities of any party or any affiliate, customer or client of a party,” the 2024 agreement said.

The confidentiality of such material would hold, “regardless of whether or not any or all of the foregoing are, may or can be patented or copyrighted,” the agreement said.

The Star obtained that agreement from Pima County through a public records request. AZ Luminaria also used a records request to obtain the earlier agreement.

Secrecy became a crucial issue for the project as it was approved on June 17 by the Pima County Board of Supervisors. It continued to generate controversy even as Tucson city officials disclosed some information in July about Project Blue’s expected water and energy use. The secrecy helped lead to the Tucson City Council’s unanimous Aug. 6 vote not to annex the 290 acres into the city so it could receive city water service.

But Beale Infrastructure, the project’s developer, has said it will continue to push to build the center and is following through on its deal to buy the 290 acres from Pima County. Beale has converted its original plan from a water-cooled system to an air-cooled system that will use far less water but will require more energy to power its data servers.

The company has said the air-cooled system will not need more energy for the entire data center complex than the water-cooled system, but that more energy will have to be used for cooling and less for the center's computing purposes.

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Since the council’s vote to kill Project Blue in Tucson, the county supervisors have tightened up on policies for non-disclosure agreements, by requiring that the public be informed of all details, including the end user, about a project 90 days before it comes up for a board vote, whether for a zoning change or a contract, Supervisor Matt Heinz said.

Because of that board decision in early September, “it can’t happen again,” Heinz said Monday of the 2023 non-disclosure agreement with Amazon. “We are not going to have Amazon, Microsoft or anyone signing something confidential with the county for five years,” said Heinz, a Project Blue supporter.

Supervisor Jennifer Allen, who opposes Project Blue, said the board reformed the county's use of NDAs because of provisions like the one in the 2023 agreement with Amazon "that preclude the public, th emedia and even the policy makers from knowing who we are dealing with.

"The new NDA policy would not have allowed an NDA" like the one in 2023, she said.

Supervisors Chair Rex Scott, a project supporter, said the board’s significant policy changes for future NDA processes were enacted by a 4-1 vote, with two Project Blue supporter and two project opponents agreeing. “That outcome speaks to the need the four of us saw for more transparency and greater Board of Supervisors oversight of any future NDAs,” Scott said.

“Confidential information,” under the non-disclosure agreement, covers “all nonpublic information relating to the company involved” and “all non-public information ... that is designated as confidential or that, given the nature of the information or the circumstances surrounding its disclosure reasonably should be considered as confidential, including the nature, content and existence of the parties’ commercial relationship or discussions about a possible relationship or transaction, or any discussions or negotiations between the parties.”

The agreement was made for the benefit of an “undisclosed counterparty, as a potential buyer or tenant and its affiliates,” the agreement said.

The agreement’s text doesn’t identify the counterparty by name. But at the top of the document it says the counterparty is Amazon Web Services.

The agreement was signed by then-County Procurement Director Terri Spencer. She retired in January and didn’t return a call to her home phone from the Star seeking comment this week.

In AZ Luminaria’s report about the non-disclosure agreement, Beale Infrastructure was quoted as saying there are no agreements in place between Beale and Amazon Web Services. “There is no company behind Project Blue other than Beale Infrastructure,” Beale was quoted.

This week, Beale declined to respond to questions from the Star about those comments, saying it couldn’t respond in time to meet the paper’s deadline.