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Pima County OKs second extension for American Battery Factory lease as company cites equipment delays
Summary
The Board of Supervisors approved an amendment extending a lease-purchase agreement with American Battery Factory (ABF) for development of a battery manufacturing facility at the Aerospace Research Campus. County staff said ABF is current on payments; the company said equipment sourcing and commissioning have delayed construction.
The Pima County Board of Supervisors unanimously approved Amendment No. 2 to the lease-purchase agreement with American Battery Factory on Dec. 5, extending the timeline for development of a battery manufacturing facility at the Aerospace Research Campus and adding a $10,000 extension payment to the county.
The amendment was presented at the board’s 10 a.m. time-certain item. County staff and company representatives told the board the extension is intended to align site construction with the arrival and commissioning of specialized manufacturing equipment.
Why it matters: the project is pitched as a large-scale battery cell manufacturing operation that, if built, would require heavy power infrastructure and extensive, custom equipment. Supervisors pressed the company for specifics about payments, schedule, and dependencies on outside entities.
John Kim, president and CEO of American Battery Factory, said the company has been delaying ground disturbance to avoid building facilities that would sit idle while the complex main production line — equipment he estimated at "about $120,000,000" — is finalized and shipped. "The worst thing you do is get started and then get stuck and we don't want that to happen," Kim said, explaining much of the main line is manufactured overseas and requires detailed integration and cyber controls.
County staff provided payment information in response to board questions. According to the county, ABF has paid a total of about $1,020,000 to date, including roughly $915,000 in lease payments since the lease began, a $50,000 security deposit and a $50,000 purchase-option deposit. The $10,000 in the amendment is an additional extension fee on top of those amounts.
Supervisors also asked about utility needs and regional development implications. Company and county staff said Tucson Electric Power is coordinating with the county and other regional partners on a higher-voltage (138 kV) substation that would serve the site; ABF said some of that new capacity may be sized to support broader regional development and is not exclusive to ABF. The company asked county staff to coordinate directly with TEP to determine final siting and technical requirements before returning any required approvals to the board.
Board members said they wanted continued updates. Supervisor Christie pressed the company on whether payments listed in the original lease schedule had been made; county staff said ABF is current on lease payments through November. Administrator Lesher and economic development staff remained available to follow up with detailed financial schedules and engineering work.
The board voted unanimously to approve the amendment.
What’s next: ABF and county staff will continue technical coordination with TEP on substation siting and finalize permitting and site construction timelines so that building work aligns with equipment arrivals and commissioning. The county will continue to track lease payments and deposit status.
