Okay, thank you for being here.

I'll call to order the regular meeting of the Gilbert Town Council February seventeenth, twenty twenty six.

We'll start with the invocation which will be offered by Sharon Kotsonas.

I got that right.

Push the button, it's up there.

There you go.

Good evening, Mayor, Council members, staff, friends and neighbors.

Thanks for allowing me to share a prayer with you this morning.

Uh this evening.

Heavenly Father, we are so thankful for this opportunity to be together.

It's a tough business.

Bless our youth, our children, our working families, our retirees.

Councilmember Bobby Buckley.

Here, Councilmember Kenny Bucklin.

Here.

Council Member Young Kaprowski.

Here, Councilmember Monty Lyons.

Here.

And Councilmember Jim Torgeson.

Aquarum is present.

Thank you.

We have no presentations or proclamations this evening, so we'll go straight to communications from citizens.

Vice Mayor.

Thank you, Mayor.

We value the participation of community members and robust exchange of ideas.

However, it's essential that this discourse remains respectful and constructive, reflecting the professionalism expected in such forums.

Misinformation and personal attacks undermine the clut our collective efforts and do not contribute to the productive dialogue necessary of our town's progress.

This is an opportunity for the public to address the town council directly about issues impacting the town.

Accordingly, the town council will not allow for moments of silence or planning of music or recorded material which could distract from the meeting decorum or violate copyright laws.

While we understand and appreciate our the passion our community members bring to this session, we remind everyone that clapping during the meeting is not acceptable.

This practice can disrupt the flow of discussion, potentially intimidate others, and distract from those from the respectful atmosphere we strive to maintain.

In accordance with state law, we are unable to respond to issues that have not been properly noticed.

Therefore, the town council may only listen to citizens who wish to address them.

And at the conclusion of the open call to the public, response is limited to individual members of the council responding to criticism made by those who have addressed the public body, asking staff to review a matter or asking the matter be put on a future agenda.

However, please be assured that your concerns and input are heard and valued.

In accordance to the town code, each speaker is limited to three minutes.

Priority will be given to Gilbert residents, business owners, and property owners.

Public comments will be limited to 30 minutes total at the beginning beginning of the meeting.

The town clerk will notify the council once the 30-minute limit has been reached.

If additional comments remain, they will be heard after the conclusion of the public hearing items with the same three three-minute limit um per speaker.

When you come up, please come to the podium and state your name and city of residence.

Council, we only have five today, so we won't be going to the end of the end of the meeting.

Yes, my name is Barbara and I live in Gilbert.

Budget Director Kelly Post stated that fiscal 27 is going to be worse than fiscal 26.

And we know fiscal 26 was a tight, really tight budget year.

This is very promising for us residents.

On January 20th, 2026, I sent an email to all of you.

The response I received was not from you, but from a Taylor Porter.

My first question was why did you find it necessary to start three major projects and substantially increase all three levels of utility services at the same time?

Unfortunately, she did not answer my question.

She typed three paragraphs talking about water.

So I shall send another email and try to be more exact on what I and other residents want to know about the ineffectiveness of the planning and scheduling.

The flyer you recently sent says you have 46 active capital improvement projects related to water infrastructure.

That doesn't sound very good to me.

You keep saying a lot of the decisions for what is taking place was from prior councils.

This is a shared debacle from all of you.

Equipment repair replacement is not something new.

New wells is not new.

Repair and service and replacement of sewer lines is not new.

Repair and replacement of garbage trucks is not new.

The responsibility the irresponsibility of the town manager, the managers overseeing water and sewer, and the town council for not doing their jobs for the past ten years has now led to the extortion you are now imposing on the residents.

At this rate, you're going, there won't be any residents to push around.

Your intention of continuous rate increases now till the end of time will get you nothing but a lot of empty apartments.

This new 568 unit tin building, five stories high on two of them at least, is a slap in the face.

There is so much traffic congestion now, it is unreal.

Combine that with the road construction on every street and the fact that water is a very limited commodity, if at all, we don't stand a chance.

So with the Cooley Station apartment increase and harvest grove, how many more do you have up your sleeve to throw at us?

Water utilities manager Rebecca Hamill acknowledged the strain the increases will place on households, but said the town has little choice.

I beg to differ on that, and you know it as well.

This is disgraceful and shameful that this many people can be so incompetent.

Thank you.

See you in two weeks.

Thank you, Barbara.

Shane, uh, I think it's is it Shane Melvin or Shane M.

Shane Melvin.

Good evening, everybody.

My name is Shane Melvin.

Um I work and live in Gilbert.

Um the reason why I'm here today is because of bugs.

Um, I've lived in my house uh in the bridges since 2014.

I live right next to the recharge basin, uh, which is uh Katio and Higley.

Um what's happening in my neighborhood is no longer a minor inconvenience.

It's uh it's affecting our daily lives.

We cannot enjoy our homes.

Arizona has beautiful weather this time of year, and instead of being outside with their families, we have to avoid our own yards because of the swarm of mid-flies.

It's not seasonal, it's not mild, it's constant.

Uh, this issue is not limited to being outdoors to bugs or inside our homes.

We've installed large fans at the entrance at every door just to try to keep them outside the house.

Uh we're constantly replacing traps inside of our house because they fill it quickly.

Uh, this is not normal and this is not sustainable.

Uh, it's embarrassing to host families and friends because we know what they're gonna experience when they come to our house.

Um, and this is not how homeowners should feel when they own this property.

We understand the recharge facility is necessary infrastructure.

Um, and we also understand that the proper management is required to prevent stagnant water conditions that create these breeding environments.

Uh the fact that homes farther away from the basin are not experiencing the problem, it confirms the source.

Uh, we've been told that the treatments have been applied, yet the infestation continues, even outside of uh typical mid season.

That tells us the current mitigation efforts are not working.

Uh we're not here, I'm not here just to complain.

I'm just asking for um your accountability and a concrete plan.

Like how often is the basin gonna be dried out, what measurable changes will be implemented, what timeline can those residents expect improvement, and uh what long-term strategy will prevent this from reoccurring.

Um, and I don't know how I get a written response about any of these questions.

This is my first time having to come up here and do this.

Um we just want to enjoy our property and the way any resident should be able to.

Um that's everything my wife wrote because I she tells me I can't land the plane.

So here's my notes.

Yeah, 40 seconds.

Um, I love I love Gilbert.

I love living in the bridges.

Um, I spent like close to 900 on fans, herbs, citronella candles, fog machines, insect sprayers, bug zappers, sticky traps, you know, name it.

Um we have dead bugs um inside our house, in our bed, on the ceiling.

Uh my pool's covered every inch of it of dead bugs every day.

Um, if you cannot charge the water basins next to the houses, I think that'll improve it.

Um they go on our cars every time we open the car door, there's bugs, there's bugs in our hair, there's bugs.

My daughter's toothbrush, um, and the food.

Just I'm asking for help, please, just to help with the budget, the bugs in the bridges.

Thank you.

Thank you, Shane.

Can we have someone from public works get back to Shane uh on his questions, please?

Elizabeth Lee.

Elizabeth Lee.

Go in once.

Okay.

She shows up, we'll leave it for her.

Eric, uh our Eric Rumstead.

Hello, uh, my name is Eric.

I live in Gilbert.

Um, thank you for having me.

I'm uh here to discuss the uh possible grants, the the um homeland security terror issue.

Um to have like a minor question if there's uh use case for this, like as is there something that perhaps happened and we need this so that we can respond to that.

If not, then I'm a bit concerned because if it's an imagined situation, I do think that the risks are real for arming out.

Case in point.

Um I got reports of um an escalation at uh Williamsfield High School that I responded to.

Um I heard that there were zip ties and tear gas, so I was concerned.

Showed up, Gilbert PD was um suited up, some of them armed.

Tried to interface with them, talk to them, see if I can de-escalate the situation, see what their um clear expectations were for the kids so we can get them.

There were like three kids at Dunkin' Donuts.

Um they weren't clear about their expectations, unfortunately.

So I told the kids um, this looks like they just want you to disperse.

I don't know what disperse actually means because there was three kids left.

Um, but yeah, this isn't gonna end well.

Please go somewhere else.

They some of them went across the way to uh air guitar.

So I went over there and Gilbert PD would not talk to me at all over there.

They just decided to push in on the kids.

There were like five kids over there.

My concern.

Um soon after that, they uh put up a post on uh Instagram letting the kids know that they should be calm and respectful, which I understand that, but setting the bar there as the expectation kind of sounds like they're not prepared to de-escalate anything given what these kids are facing.

So I found that a little bit concerning.

So when we're talking about the ways in which we're gonna spend the money to make sure that we have more uh uh use of force.

Um I'm I'm a bit concerned.

Um I feel like it's that old saying uh if the only tool you have is a hammer, everything looks like a nail, and we're about to get bigger, heavier nails or bigger and heavier hammers.

Um I'm concerned there.

I I feel like the focus should be more on de-escalation, and if we go more towards the hammers, then uh it may be harder to get that point across.

Thank you.

Thanks, Eric.

Uh Elizabeth Lee, are you here?

Okay, Clay Richardson.

Good evening, Mayor and Council members.

I've been a resident of Gilbert for 25 years, and I wanted to share a few positive stories about town of Gilbert staff.

Last year, I put a large pile of trash clippings out for bulk pickup because my wife told me to.

And as soon as I found out, um a few hours later, actually, there was a uh a flyer on my front door, and it was said I was out of compliance.

I thought that was incredibly thoughtful of town staff to be able to do that.

Instead of just passing over my bulk trash, they told me why it was not in compliance.

I think that's taking the extra step.

A few months ago, I had a leak detection specialist from the town of Gilbert come and accurately located a leak that I've had on my property for quite some time.

Not only did they fix help me fix the leak, but then walked around to my trees and shrubs and talked about how I could use water saving measures.

They went above and beyond and answered every question that I had.

Lastly, a couple weeks ago, a street light in my neighborhood went out.

About the time I realized it was out, there was a Gilbert crew there fixing that light.

Okay, this is in my neighborhood, and they recognize it almost as fast as I recognized it.

It was like Swiss perfection, Swiss precision.

All of these stories are encouraging on their own, but there's a little bit to each more each of each story regarding the bulk trash situation.

The town staff put that on my door the day before bulk trash was scheduled to come.

So I was able to get my bulk trash in compliance before they arrived.

So they're anticipating it.

I was so impressed by that.

The leak detection specialist didn't even come from my house.

It was my neighbor's house.

And while he was standing around, I just started talking to him and hey, let's go check out your house.

And he helped me out there.

That's super impressive.

And the street light, they were doing that work well past sunset on a Friday night.

So these the common thread here is that the staff truly cares about our community, and you cannot fake that.

That cannot be faked.

I'm proud to be part of this community, and I'm proud to see the people that so capably and humbly serve our community.

I'm the participant in this year's Gilbert Leadership class, and the more I'm exposed to this community, the leaders in it, the more I'm impressed by the people within it.

So I understand that there are difficult things that come up from time to time, but I understand that you all are taking your role seriously, and everyone who works for the town staff, they take it seriously as well.

I'm grateful to be part of the town of Gilbert.

Thank you, Clay.

Um, and just to respond back to Eric, we're we're gonna ask staff to do a presentation on number nine for you so you can understand that a little bit more.

All right.

So thank you for everyone's um feedback.

To begin the consent calendar portion of the meeting, I will pass the time over to our town manager, Don Prince to provide an overview of items on the consent calendar this evening.

Thank you, Vice Mayor.

Good evening, Mayor and members of the council.

Um this is the consent item agenda agenda item overview for tonight.

Okay.

Um this slide represents our continued focus on preparing for the future and ensuring resilience in Gilbert.

Um, these are our pillars, strong economy, prosperous community, and exceptional built environment.

As we go through the uh consent agenda items, you will see that the items that we look to bring forth to the council do fall within one of these pillars.

Um it's really important for Gilbert's future.

Okay, item number one is an IGA addendum with ARM of Save the Family.

This is under the Prosperous Community Pillar, and it is a motion to approve addendum number one of the IGA agreement with ARM of Save the Family to add specified addresses to the scope of work outlined in the original agreement.

This program acquires, rehabilitates, and manages single family homes as affordable rental units for income eligible households in the community, and is funded via an annual allocation of federal home funds through a consortium agreement with Maricopa County.

There is no financial impact to the town for this addendum as it is an administrative update only.

Sorry, hit the button a little bit too quickly.

Item number two is an amendment to the home consortium agreement, and that is under our prosperous community uh pillar as well.

It is a motion to approve an amendment to the home consortium agreement authorizing the addition of the City of Goodyear as a member of the consortium as a participating member in the consort consortium managed by Maricopa County.

New member municipalities must agree to accept their membership in this program.

There is no financial impact to the town for this amendment.

Item number three is a cooperative contract with chameleon industry industries incorporated, and this one is under our exceptional built environment pillar.

Is a motion to approve the cooperative purchase contract with Chameleon Industries Incorporated for the procurement of aluminum sulfate, a critical material used in surface water treatment plants.

This contract is not to exceed 680,000 per year with a four-year term.

This item is rate supported through the water fund.

Item number four is a contract with ICM Water Care Incorporated, and this one is under our exceptional built environment pillar and is a motion to approve a contract with ICSM Water Care Incorporated in an amount not to exceed 250,000 per year with a five-year term.

ICM water care mixers, sprayers, and total trihalomethane removal equipment are used to mix chlorine in our drinking water reservoirs and to mitigate TTHM contamination, helping ensure compliance with water quality standards and maintaining TTHM levels.

Item number 4A is a development reimbursement lien agreement with Simon CRE.

And it is a resolution to approve a development reimbursement lien agreement with Simon CRE C550 V LLC and GB Investments for infrastructure improvements at the southeast corner of Higgly and Acateo Roads.

This area is currently under construction for a CIP project that includes widening of the northbound travel lanes simultaneously.

A vacant parcel of land in this area is under review, and as part of the development would require off-site improvements.

This agreement would enable the developer and owner to allow the town's contractor to complete the required improvements and be reimbursed for them.

There is no financial impact to the town for this item.

Item number 4B is a CIP contingency and construction services contract with Sunt Construction Incorporated.

And this one is under our exceptional built environment pillar.

Item number 4B is a CIP contingency and construction services contract with Sunt Construction Incorporated, and this one is under our exceptional built environment pillar, and it is a motion to improve approve CIP contingency and construction services contract with Sunt Construction Incorporated for Acateo Road Improvements between Greenfield and Higley.

This item supports the work detailed in agenda item 4A and enables the town to coordinate construction concurrently with the CIP project, minimizing further disruption to the public and throwaway costs incurred by rep repetitive construction.

Funding for this item will be from the CIP outside sources revolving fund and will be reimbursed per the agreement with Simon CRE in the amount of $838,023.

I am just okay.

Item number five is a change order to agreement with Endris Houser Incorporated.

This is under our exceptional built environment pillar, and it is a change order within the purchase contract with Endrus Houser Incorporated to extend the contract duration by one year through June of 2027 and for an amount not to exceed $220,000 for the procurement of products and services essential to maintaining and operating the town's water production processes at its treatment facilities and wells.

The current value of the contract is $180,000, but it does not cover cost escalations necessitating an increase of $40,000 for fiscal year 2027.

The funds for this item are currently included in the rate supported water fund.

Item number six is a claim settlements contingency requests, and this one falls under our strong economy pillar.

This is a motion to approve contingency requests in the amount of $485,320 for the claim settlements incurred during Q2 of FY26.

These claims were reviewed and processed by the town's risk department, and because they vary per quarter are not included in the operating budgets of the impacted departments.

The financial breakdown of the requests is as follows.

General fund $93,290, streets fund $240,260, wastewater fund, $23,570, solid waste residential fund, $108,310, and solid waste commercial fund, $18,890.

Item number seven is a grant application acceptance and administration for the build grant with the U.S.

Department of Transportation.

This one falls under our exceptional built environment pillar, and this is a resolution authorizing the application, acceptance, and administration of a better utilizing investments to leverage development or build grant from the U.S.

Department of Transportation to provide a project assessment and feasibility study for the Hunt Highway Corridor from Val Vista to Wrecker in an amount not to exceed $1,065.

If awarded, there is a required 20% match which can include both cash and in-kind contributions.

If awarded, staff will evaluate the use of in-kind contributions to reduce the project's match amount.

Funding to support this project would be a part of the FY27 budget cycle.

Item number eight is a grant application acceptance and administration with the Arizona Department of Homeland Security.

This one falls under our exceptional built environment pillar and is a resolution authorizing the application acceptance and administration of a grant from the Arizona Department of Homeland Security for Cybersecurity Infrastructure and Obability Monitoring Cabilities within the Town of Gilbert, addressing high priority preparedness initiatives to protect its critical municipal infrastructure from cyber attack threats that could disrupt essential government operations, emergency services, and public safety systems.

This grant request is for $92,045 and may require matching funds up to 25% of the total project costs.

If required, the match would be provided from the existing IT operating budget up to $23,011, which is part of the general fund.

This one falls under our exceptional built environment pillar and is a resolution authorizing the application acceptance and administration of 2027 Homeland Security Grants in an amount not to exceed $574,750 for projects programs that support the state of Arizona Homeland Security and respective regional strategies.

This grant would request the funding for the following initiatives and items.

420,000 for our police department armored rescue vehicle, $35,250 for training for police and emergency management personnel.

$32,750 for fire department drone programs that support crew overwatch and citizen safety.

There are no matching funds required for this grant program.

And with that, we'd be happy to take any questions.

Are there any other ones anyone would like to see?

Uh number eight, please.

Number eight also.

Anyone else?

Okay.

So staff, um, we'd like to see presentation on seven, eight, and nine, please.

For item number seven, Jason Hafner is coming up to talk about the build grant.

Mayor, counsel, I'm here to answer any questions you may have.

Um is there a cost associated with us doing this?

Uh besides the 20% match, we did uh hire a consultant, AECOM to help us put together a um project application, and we paid around $20,000 for that.

Is there a timeline that this has to this this decision has to be made by?

Uh applications are due February 24th.

Can I ask how long we've known about this?

Uh mayor, council member probably about three weeks, four weeks maybe.

Okay.

Um I'm just I'm just trying to figure out myself the the need for this.

I know it's considered quote unquote free money from the government, but we also will have a 20% match if needed in 2027, which is a very difficult budget year for us.

And I'm personally just wondering myself if we've discussed this.

This is the first time this council has heard of this.

And personally myself, I'm wondering if there's a need for Hunt Highway to go from Val Vista to Record Road.

I mean, quite honestly, it feels like we should put a big sign saying you're welcome, Queen Creek, if we finish that road form.

So maybe I'm on a line there, I don't know.

But I I'm a little push back a little bit about this is the first time we've heard of it when two years ago we did hear from the last mayor some discussion about this.

So I'm just wondering what the other council members how they feel about this too.

I'm actually curious where this sits in the CIP projects.

I mean, is this something that's scheduled coming up soon, or is it 10 years down the line?

Yeah, mayor, council member, both segments of this project are in the CIP currently.

One was scheduled for next year, but I think it got bumped back.

We also have uh funding identified through MAG for the construction of uh one segment of these projects.

It is located in the MAG TIP.

So uh we were looking to do an analysis of the project location to see if it was feasible to build this roadway.

Uh, and if so, what that might look like.

So we're spending money to decide if it's feasible to do something that's pushed down the I'm just trying to understand also.

Yeah, so there are a lot of complications in this corridor.

It's the reason it hasn't been built to this point.

Uh there's the mountain, the mountain, there's uh two canals, there's also uh coordination with Gila River Indian community to the south.

So there's also right-of-way concerns to the north.

It's a very narrow location, the amount of right-of-way that the town has.

So doing a study to see if it's feasible, and if so, what the design should look like should we get that far is what we are hoping to accomplish with this grant application.

Okay, I'm I'm just digesting the thought on this of with everything that's going on.

I mean, grants don't come along every day for $800,000 or whatever the total would be since we're doing a 20% match, but is it escalating something forward that's really not on doesn't need to be on our horizon?

Like it could be farther off.

Potentially, but that's something we're hoping to find out with the study, how critical as part of the study at least would identify how critical this roadway is.

Okay.

Councilmember Lyons.

Yeah, I was just curious.

Does this commit us to go through with the construction if we get this grant?

Absolutely not.

Okay.

Uh Councilmember Buckley.

Okay.

So what why would we want to kind of build this for Queen Creek?

What it what is what I and I get, you know, it's it's kind of the regional roads that I live kind of out in that area, and the traffic is getting really bad.

But I I'm not quite sure I understand why we should be paying for a road that's in Queen Creek.

Mayor, Councilmember, the roadway is not in Queen Creek.

This would be in the town of Gilbert right of way.

That was gonna be my next question because uh no knowing what where that is, my thought was it's not in Queen Creek, it's in Gilbert.

So that makes a huge difference.

That's correct.

Yeah, yeah.

Because uh like I said, I live out there and the the traffic traveling in right now because we're trying to open Ocateo Road is just incredible.

It's it's like the freeway.

And uh I had an early early meeting, and I think it was probably seven o'clock, seven fifteen, and there was just cars like the freeway driving, going east and west, and it was uh we need to fix that.

And and and I will say that if we if we can get a grant and it's in Gilbert for 800,000, I'm I'm all for that because we need we need to fix that.

We need to open that up because it's only gonna get worse.

Mayor, council member, that is part of the reason we want to do the study and potentially eventually build this corridor is for congestion relief for those folks down in the southern part of the community.

Don't mess with the mountain.

You're gonna have to go around it.

Heard council member.

Okay.

Councilman.

All right, thank you.

Thank you so much.

Councilman Koprowski.

Jason, could you confirm that the build grant amount is the 1 million six thousand five hundred and twenty and that the total amount with the twenty percent match would be one point two million?

Uh council member mayor, that's not a maybe uh well written uh section of the of the uh uh council communication.

It's we're actually the total project cost we're estimating at one million, and so the town's portion would be closer to two hundred thousand.

Okay.

And could you explain or confirm the scope of work that would fall under that million dollar budget?

Because it that doesn't pay for much in construction dollars, but it sounds like maybe this is more pre-design and a planning study, and could you kind of talk about that a little bit?

Yeah, that's correct.

We're doing a feasibility study as well as 15% design plans.

So there'll be an alternatives analysis as part of that uh existing conditions report and get into the NEPA design a little bit uh as required to sort of identify what elements need to be included as part of design construction.

Essentially, what we're looking to do is draw the line on the map to see where it would make sense to build the roadway if it is a build option that comes out of the study, and then that will set us up if we do choose to pursue additional funds for design construction, as well as if we do not choose to go that way and we do choose to construct this roadway on our own time to figure out where exactly we should uh build that roadway.

And is that level of scoping required to try to get future funding for construction from the region?

Uh mayor, council member, it's not required, but it certainly does help.

If we show FHWA has already got skin in the game, so to speak, they're more likely to then fund projects in the future.

Additionally, the information that comes out of 15% design plans helps us to build, for example, a benefit cost ratio, which is a key element of going after design to construction funds for federal funding opportunities.

Thank you.

So, Jason, this total bill could be way over 200,000, right?

If we would do this and it goes forward and we build this road, way over 200,000, right?

Mayor, council member, for the purpose of this study, the bill is fixed at 200,000.

Okay, but I could pay $60,000 for a feasibility study to see if I can climb Mount Everest, but I got asked the question first.

Do I want to climb Mount Everest?

You know?

Um and when did you say the cutoff was for this?

February 24th.

So there isn't a time for a study session on this.

Mayor, council member, not if we want to submit the build grant application on time.

Okay.

Thank you.

Any other questions?

No.

Thank you.

Uh presentation.

Thank you, Jason.

Thank you.

Presentation for number eight.

Hi, good evening, Mayor and Council.

I'm Jeremy Kurtz, assistant CIO.

Happy to answer any questions.

Council member Lyons.

Uh yes, sir.

I was curious about in the verbiage here to talk about continuous monitoring capabilities and observability monitoring.

Can you explain that to me what that actually entails?

Yeah, absolutely.

So it is looking at all of the log files of our systems and also the various sensors that they have in our IT systems, and just uh aggregating them so that we can pay close attention to what's happening in our environment.

And this is also to supplement existing capabilities that we have with a cloud-based product for something that we have on premise.

So just want to clarify that.

Okay, so it does impact our on-prem footprint, correct?

Correct.

All right, and it helps secure that.

Exactly.

Okay.

Thank you.

Any other questions?

I want to go back to number seven.

I'm sorry that I'm done with you.

I actually wanted to go back to number seven for something came to mind.

Mayor, council?

All right.

Was there something you'd mentioned in kind?

Is that to say maybe the time of staff being used?

Is that in kind?

Mayor council, yeah.

Uh a lot of federal grants offer the opportunity of essentially trading or utilizing staff time towards the match component of a grant.

Um at my previous job, Sun Corridor MPO, we tracked that of member agencies, and we could utilize their time on specific projects to reduce the actual cash match that we had to apply.

We don't do a lot of that currently here at the town, but it's something we would look into if we're awarded this grant.

All right, and where would the funds that are coming in, where would they be going out to you're getting a million dollar grant?

Where are the funds being paid to?

Uh mayor, council member generally staff hires consulting firms to help complete studies of this complexity.

So in this case, we would um put a request for qualifications or a quest for proposals out on the street, hire a consulting firm to come in and help town and staff put together a report that would meet all the federal guidelines and get us the information that we needed.

Okay, so then the in-kind is not likely to to absorb a major portion of that 230,000.

I wouldn't say a major portion, it can cut down the amount.

Staff is still gonna spend a significant amount of time even though we are hiring a consultant.

It's just a matter of um not currently probably having the processes in place to track that, so figuring out what it would take to install those uh processes in order to track the time and if it's worth it for the cost that we would save.

All right, thank you.

Jason, what happens after we spend 230,000 and the council says we don't want to build this road?

Mayor council, then we've learned a lot about the southern part of the community, and uh, we have more information to make that decision with.

Okay, thank you.

Any other questions on this guy?

No.

Okay, can we have someone to speak about number nine, please?

Thanks, yes.

Mayor, vice mayor, and council.

Uh item number nine, I'll speak on the first three, and then Chief Doug will speak of the last two.

Uh the first one is the armored vehicle, and that is to replace our current armored vehicle, which is about 17 years old, and it's at its end of life and in need of a replacement.

Um to note uh FY26, we requested this, and the state has not issued funding for FY26 yet.

So there is the possibility that we could get funded through at the FY26 grant, uh, which you approved last year, and this is for the FY27 request.

So the first item, um, our armored vehicle, which we use for our SWAT operations anytime we're doing a high risk uh operation.

Uh that is uh needing of replacement due to wear and tear and the age.

Uh Councilmember Buckman.

Probably was part of that purchase 17 years ago, and uh it needs to be replaced.

The second item is the um for TLO sustainment that would uh send two members, uh, one from Gilbert PD and one from Gilbert Fire to the TLO training, the annual training in uh with the National Homeland Security Conference, and then the third item is to replace some of our night vision goggles that our SWAT team uses for night operations, and the fourth and fifth.

I will turn over to Chief Duggan.

Thank you.

Mayor, Vice Mayor, Council talk a little bit about the um funds we're requesting from UASI.

The first group of this for the fire department is sustainment funds.

This is an annual request we make through UASI.

Essentially, what this is that it provides us training and equipment to maintain our existing all hazards, hazardous materials team.

That includes training as members' timeout of the program to be able to get trained up to the hazards material technician level.

Additionally, it's things like meters that need to be replaced.

Uh, there's a lot of support equipment like test gases that expire that we have to replace annually to make sure that all of our equipment is operating effectively uh to serve the needs of the community, maintain our hazards, hazardous materials team.

So that's the first section of this.

It's an Android request we make through this program.

Uh the last section talks about um particularly special ops.

This is additional drone equipment as we've come to learn drones are really expanding the capability and effectiveness of both PD and fire in these spaces.

And what we're finding is some additional specialized drone equipment at this point in Gilbert uh to be most effective, any large event we have, we will have both drone teams on site to provide overhead views, an example of some of the challenges we might have in a fourth of July celebration, 10,000, 20,000 people at Gilbert Regional.

Someone has a heat emergency in a remote area of that park, lays down on the ground.

Our crews get dispatched to that that are staged there, locating that person without a drone overhead can be very, very difficult.

People don't always understand north, south, east, west, or where they're at with things.

The drone capability allows us if someone has any kind of trouble, the drone team is already overhead, they can locate very rapidly where that individual is and basically walk our crews directly to that site.

So it has a tremendous amount of effectiveness on being able to reach people in those large special event spaces, not just at Gilbert Regional, but any other locations we have.

So this really enhances our ability to continue to protect and serve the community as we're continuing to have more and more special events and the great work that Henderson is doing uh to bring tourism dollars in.

We would expect that continue to continue to be a part of trying to bring additional revenue to the town, and we think this is an excellent way for us to support the community.

Thank you, Chiefs.

Any questions from the council?

Great, thank you.

Well, I have I'm sorry, my typical question, and you know what it is, Chief.

What are the strings attached?

No strings.

Um, it is just a request for funding.

Uh there's no matching grants.

Obviously, uh, like the uh SWAT vehicle, obviously, we already have budget for repair maintenance, fuel, whatnot.

So, other than normal operating fees that we would cover anyway, there's no matching, there's no other uh hidden strings to this.

Thank you, Chief.

Um, of seven, eight or nine.

I know I want to separate seven for a separate vote.

Would anyone like to eight or nine?

Sure.

On the grants in general.

Um seven, Vice Mayor.

I I understand you're concerned about you know spinning some money.

But what I'm trying to look at in all these things.

If if this was my house, and this is our house, right?

One, we represent all of Gilbert.

And I realize the road is really close to Queen Creek, and it may give Queen Creek more access into Gilbert.

Hope it does.

Hope they come shop here.

Um I realize it'll give our residents um quicker, easier access to to Queen Creek, should they go down there?

But we represent the entire community, not just segments of it.

And um, as council member Buckley described, traffic's gotten really horrible all the way down there.

There's just a lot of obstacles.

So if I'm looking at this like my house, and it's gonna cost me a million dollars, which it never will because my house is just not that big, but it's gonna cost me a million dollars to determine do I need to do a major overhaul on the roof or whatever.

And I have someone coming in and saying, we're gonna give you $800,000 to do that.

You're gonna do it at pennies on the dollar.

I'm gonna say yes.

Um we may get to where we decide not to build that road, but we don't know until we do the study.

Study what it's in the CIP, the study will tell us what we need to know, and it's covering 80% of that cost.

It just seems like a no-brainer.

In terms of these other grants, as a former police commander, I've sat before councils who I just scratched my head, they didn't want to take free federal dollars.

And if they don't, then the equipment continues to wear out, that creates risks, and at some point we're gonna have to replace it out of our own budget.

We're already going to be talking about raising water rates.

Um we um we're going into a horrible budget year.

So all three of these things are money that can help us do better for our public and for our staff.

I just don't understand why why would why we wouldn't.

Thank you.

And Councilmember Brockman, I I agree with you on on that.

My comment about Queen Creek was tongue-in-cheek, so it wasn't something serious.

But my concern with with this one is I I don't like my back being against the wall.

I I don't like by the way, if we we want to throw 200,000 dollars towards this and we want to do it, now it's gonna cost us millions and millions of millions of dollars.

I mean, we've known about this for at least three weeks.

I I I wish staff would have come to us for individual meetings to let us know what their thoughts were on this.

So um I'll do a separate motion for that.

Uh, there's um eight and nine are okay with being on the main.

Okay.

So then uh if no further questions, uh move to approve the consent agenda items one, two, three, four, four A, four B, five, six, eight, nine, and ten.

Can I have a second?

Second.

Second by Councilmember Bucklin, please vote.

Vote passes seven to zero.

Okay, for um item number seven.

Um I'm gonna put a motion in to deny number seven.

Is there a second?

Can we discuss it a little more?

Sure.

This is the kind of thing, as he's saying I feel like my back's against wall.

Throwing 200,000 in in the scope of our budget may not sound like a lot, but it is a lot.

And there's no time to digest this other than the last few days getting this on a in our uh packets.

Is there my hesitation is because I don't know enough.

I literally don't know enough, and it's thrown as back against the wall.

Don't have a chance, you know, don't have a chance to really digest it.

And the scale isn't the hugest scale, but if this was ten times that, if it was a ten million dollar grant and it was two point three million dollars of copay, uh, would we be having the same discussion?

I'd be shutting it down because it's just such a huge number.

Uh how is it that we are this is thrown on a consent agenda and there's no discussion in advance.

It's it's important enough that these things need to be discussed because we're spending our residents money, and it bothers me that I feel I'm making a half-cocked decision.

Consumer Lyons.

I want to be cautious in how I say this, okay.

Because I appreciate both your positions as far as the last minute nature of this.

However, these opportunities don't come up that often.

And we do have major problems in that part of the community that need to be addressed from a roads perspective.

This gives us a heads up and positions us to be able to know what is going to be coming at us and the feasibility of our ability to afford it down the road.

The other part, and correct me if I'm wrong, Susanna, but there is a mechanism in this that allows us as far as the matching funds to be able to utilize the time staff puts in to this process to be able to reduce that cost out of budget.

So I think that is am I correct about that?

So when we look at that, this will give us the understanding of where we should place this in our CIP projects within the future.

Because this is going to be needed down the road.

And when I look at the overall cost of it, if I understand we're probably looking at 220,000 maximum to do this roughly, right?

And if we can deduct that part that our staff is using labor-wise too at that cost will come down, it puts us in a good position to understand what we need to do for the future, especially as we're planning out some of this stuff that's got to come.

I do agree with you guys.

I'm not necessarily comfortable with the last minute aspect of it, but when you look at the overall budget that we have, 200,000 on honestly is a small investment to make if it can save us a lot of money down the road, because this would position us to be able to make smart decisions and give us a good view for it and let Uncle Sugar pay for part of it.

So thank you.

Councilmember Buckley.

Okay.

Um I have I have a question.

So it appears that you guys just got this maybe three weeks ago.

Um I'm guessing that it took you some time to prepare for this and to look at it and to make that decision.

I mean, you can't make that decision on a day to put it on the agenda and try and get this.

So I don't I don't think it was deliberate that you we are just now maybe finding out about this, but I and Councilmember Lyons said a lot of things that I agree with, and some that that I wanted to bring up as well.

But uh, you know, like I said, I'm just gonna repeat, I am in that area, and I also owned a property really east of Queen Creek, which is now Santan Valley, many years ago, and I saw what a disaster the traffic is out there and what it you know and what it is still, they're still trying to catch up, and this was 25 years ago.

And I don't want to see the area that I live in and I love out there.

I'm off of Chandler Heights and Higley, and I can tell you the morning that I got up early to go to our breakfast meeting, I sat, you know, coming out of my subdivision and waited, and the traffic going from east and east and west on Chandler Heights, it and it was literally non-stop.

The lights, their time pretty good, but for right now with the construction going on, the the timing needs to be better, something needs to happen.

And we're talking about an area that's just um a mile, probably a mile, not too far off of that.

If we if we don't fix that now, it's gonna be extremely expensive to fix in the future.

And um I you know, I don't know what what what time frame it took you guys, but I know you had prep work you had to do, and you also had work to try and get this grant as well.

So I just want you to know I appreciate the work and um I appreciate what you've done, and I I you know I I'm I'm voting for this because we need to do it, and it doesn't mean and and correct me if I'm wrong, that we're gonna start building this road in a year or two years.

It's probably more like five to ten years, would be my guess.

All right, well, I'm finished.

Thank you.

Thank you, Councilmember.

Councilmember Twerks, did you have anything?

Yeah, the 800,000 or so.

Uh if we didn't take this, we would still be spending that money in the future, maybe not get a grant for it, but we'd have to do the same process.

So, in a in a way, we're we're taking a 20%, we're taking 20% to save 80% later.

That is in essence what we're trying to do here is to add additional revenue to the stream to help pay us or pay for this road as we look at it for either today or tomorrow or in the future.

So to make this less confusing, uh Scott, did you want to I'm ready to call for the question?

Okay.

Someone might make a motion to approve.

I just have one more comment if I may.

I've had the mic on.

May I?

So I just respectfully I understand it it came fast and it feels like backs against the wall.

Um I do want to remind us though that um we've seen the data, we have less people doing more work than any community around us, and um we've got to re remember that this is a business, and a lot of times we forget that government is a business, and in business, we're all successful in our private businesses and in prior government for some of us.

Um things move fast, and we have to be able to pivot quickly, and this is I think one of those times.

And this is, I think, one of those times.

Um we also we don't get a ton of time to see these packets, but we did get about a week.

And um what I do is if I I go I know every one of this, every person on this council reads it.

They read everything, and I appreciate that.

I respect that.

Um I see something that called a question.

I don't wait till I get to this council meeting.

I reach out.

We all have issued cell phones.

I call, I ask questions, I get it resolved before I get here.

So just just you know, we're all going really, really fast.

So we all have to do our part.

We all have to give each other grace.

And I'll leave it at that.

Thank you, Councilmember.

Someone would like to make a motion.

I make a motion that we approve.

Item seven.

Seven.

Thank you.

Ten.

Is it ten?

No, it's seven, it's seven.

Is there a second?

Second.

Second by Mayor.

Please vote.

Motion passes six to one.

Mayor, I'm gonna pass the meeting over to you now.

Thank you.

We'll move on to the public hearing section, which are items eleven through eighteen.

And I know that the last three, sixteen, seventeen, and eighteen will want to consider separately, but does anybody have any issues with any of the others?

11, 12, 13, 14, or 15.

You'd like to.

Which one are we pulling?

Nothing, yeah.

No, no.

Well, we're gonna pull the ones for the toes.

We didn't pull the ones that have to do with the first part here that goes through um.

We're we're considering eleven through fifteen as a block to vote.

Not I'll open the public hearing.

I will close the public hearing on items eleven through fifteen and ask for a motion.

I have a motion to accept 11 through 15 as written in the agenda.

I have a second.

Second.

Please vote.

Motion carries seven zero.

Uh items sixteen, seventeen, and eighteen.

Chris, can we um consider these as a block since uh the people that want to speak or about all three issues?

So mayor Anderson.

That's correct.

You can you can take one public hearing and then have separate votes if you so choose.

Okay.

I would like to have we'll take the uh we'll do uh consider them as uh a block 16, 17, and 18.

And ask first for staff presentation, which I think we'll start with uh who are we starting with, Rebecca or who are you?

Okay.

Good evening, Mayor and Council.

Tonight we will present on the proposed rate adjustments for both the solid waste and recycling fund and the water fund.

I will begin with the solid waste and recycling fund.

My name is Isaiah Scarcia Romero.

I'm the solid waste and recycling manager.

After that, Rebecca Hamill, our water manager, will present the water fund overview and the rate proposal.

As with all critical discussions, we believe that it is essential to highlight our mission.

It guides every decision for Gilbert's future.

We anticipate challenges, we create solutions, and we help people thrive.

Some solutions require difficult choices, but they prevent far greater problems.

Tonight we are going to walk through one of local government's most impactful responsibilities the provision of public health through solid waste and water services.

We cannot be successful in serving our community without our council.

Council's direction is essential to delivering on Gilbert's high quality of life, we've all come to love and expect.

Before we start, I want to recognize the outstanding men and women of our solid waste and recycling division.

Their dedication to our town keeps it clean, safe, and sustainable every day.

This presentation reflects their hard work and commitment.

We will go over the rate pressures for our 2026 rate overview as well.

I will cover the solid waste residential commercial fund pressures in more detail, but I will drill down for you four main pressure points.

Rising vehicle replacement costs, increased repair and maintenance for an aging fleet, higher landfill disposal fees that went into effect after the last race cycle and were not incorporated in the last approved rates, and volatility in our recycling market.

Starting with vehicle replacement, before 2020, refuse trucks cost approximately 285,000 with a 10-month lead time.

Since then, costs have continued to rise.

The current cost of a siloader now exceeds 525,000 due to higher component and manufacturing expenses.

The impact we've seen is that we vehicle replacement costs have now increased by 87% since 2020, and 27% since the last rate adjustment in 2023.

These increases have permanently raised the baseline cost of refuse vehicles and reduced the purchasing power of the replacement fund.

To understand the impact that the rising vehicle replacement costs have had on our system, we needed to review the condition of our residential silo collection fleet.

The industry standard replacement cycle for our vehicles is seven years.

We currently have 13 units beyond seven years, with six being replaced this year.

That leaves one-third of the fleet overdue for replacement.

Even after this year's purchases, more than half of that fleet will need to be replaced within two years.

We know that maintenance costs increase significantly as vehicles exceed their life cycles.

Last year we spent nearly $2 million maintaining vehicles past their intended replacement age.

By comparison, newer vehicles incurred about $900,000 in maintenance cost.

Replacing overdue units and restoring a consistent replacement cycle will reduce repair costs and improve our fleet reliability.

Looking closer at the rising costs to maintain the fleet before 2021, the annual repair and maintenance of the solid waste and recycling fleet costs just under one and a half million dollars.

In 2021, cost increased to 2.8 million due to supply chain disruptions and parts shortages, which affect the hydraulic systems, the electronics, our sensors, the wiring harnesses, microchips, and control modules.

Ongoing impacts from aging vehicles, advanced technology, and rising parts costs have continued to drive expenses upward.

Repair and maintenance costs have increased 301% since 2020 and 44 percent since the last rate I just met, reaching nearly $5.5 million last year in cost alone.

Our partners uh at Republic Services in terms of our uh landfill uh tipping fees have cited supply chain constraints, equipment and material shortages, labor challenges, and rising fuel costs as drivers of higher fees.

Post-COVID landfill tipping fees increased to three and $3.4 million, and while costs remain relatively stable through 2023 rate adjustment, cost increased to $5.5 million last year.

Overall, landfill tipping fees have risen 87% since 2020, with 45% of that increase occurring right after the 2023 rate adjustment.

Because the recycling market continues to fluctuate, we budget conservatively and rely on historical trends.

Over the past five years, costs have varied significantly.

In 2021, our highest year, recycling cost us about $800,000 or $36 per ton.

Last year, instead of paying, we actually received a $5.80 and 83 cent rebate per ton.

Overall, our five-year average net costs have been $18.08 per ton, which reflects just how volatile the recycling market can be.

When residents in Gilbert use their trash services, they have the choice between separating materials into trash, the black hands, or recyclables, the blue can.

Trash is transported to the landfill for disposal when recyclables are delivered to a material recovery facility or the MERF at the acronym in the industry.

They're sorted there, processed, they're bailed, and sold to secondary markets.

We've heard some of our residents question whether it makes sense to recycle or if it would be cheaper to send all of that material to the other side of the stream, which would be a landfill.

These figures here show on average over the last five years that it costs our operations $18.08 per ton to recycle in comparison to $30.97 per ton to landfill on average over the same uh same five years period.

Taking the time to recycle not only advances sustainability, but it's also environment and environmental goals, but it also provides significant economic value compared to landfill disposal.

In summary, landfill disposal is the largest cost pressure in our solid waste system.

Recycling helps offset that pressure by reducing disposal costs and sustain and supporting sustainability goals.

Every ton recycled avoids landfill tipping fees, lowers the operational expenses, and preserves long-term infrastructure capacity.

Our bottom line for our recycling and solid waste fund, it's not just environmentally responsible, but it's also financially smart choice for our town solid waste enterprise fund.

Because so much of the fund's costs are based on how much waste is produced, it's important that we understand how we compare to similar communities.

Using the 2024 Gilbert Arizona benchmark report, we looked first at trash generation.

This data here shows that the average household in our town generated 2,079 pounds of trash, about 240, about 240 pounds or 13 percent higher than the peer average.

Looking at recycling, the same report shows our average household recycled 443 pounds of material last year.

That place is right in line with the peer average.

So our recycling participation is healthy.

The challenge is that we are generating more total waste overall.

When we compare the waste we generate to the amount we recycle, we refer to that as our diversion rate.

In Gilbert, our overall diversion rate falls below the peer average.

Because we generate more trash, even average recycling performance results in lower overall diversion.

Increasing diversion is key.

Every time every ton that we keep out of the landfill reduces disposal costs and preserves long-term capacity in the landfill.

That is why we've implemented additional programs aimed at diverting more material away from the landfill and improving the overall sustainability and financial performance of our system.

In response to recycling market conditions, we discontinued glass collection in blue cans in February of 2024.

Our contract at MERF did not and does not now have a secondary market for glass.

We were paying processing fees and the material was ultimately landfilled.

In 2024, after hearing feedback from the community, we transitioned to five dedicated drop-off locations.

We now deliver material directly to one of our partners' strategic materials, where it is recycled and generates a rebate.

Today we have earned approximately $8,000.

Under the prior system, we would have incurred roughly $39,000 in processing and disposal costs.

If the glass had been landfilled, it would have incurred roughly $13,400 in landfill fees.

This program reduces costs, mitigates market volatility, and ensures glass is truly recycled.

In another effort to reduce the amount of waste that we landfilled, we partner with Goodwill of Arizona to pilot a drop-off program for donations.

Two solar-powered ADA compliant containers are located at Discovery Park and Cactus Yards, providing 24-7 access and continuous surveillance.

The units are maintained at no cost to the town.

This program promotes reuse, keeping usable items out of the landfill and recycling system again at no cost to our ratepayers.

Improper disposal of lithium ion batteries is a growing safety concern in the industry.

Over the past three years, we have experienced 13 truck fires, including one total vehicle loss that took place last year.

Our most recent fire occurred last month, and lithium ion batteries were discovered in the debris as the likely cause.

We are developing a battery drop-off pilot program to serve residents who live furthest away from our household hazardous waste facility.

These new drop-off sites will improve safe disposal access, reduce fire risk, and support responsible recycling of these batteries.

We anticipate launching this summer following logistics plannings and staff coordination.

To further support diversion and resident convenience, we are hosting a one-day drive-through collection event on February 28th from 7 a.m.

to 1 p.m.

at the Public Works North Area Service Center.

For this event, our household hazardous waste facility will be mobilized on site, providing residents a safe and convenient way to dispose of items not accepted through our curbsite service.

In partnership with the Gilbert Police Department, we will also be offering free secure drug document shredding.

Additionally, local community partners, including Goodwill, Treasures for Teachers, the American Legion Post 39, and the Lions Club will collect items for reuse and recycling, further reducing landfill disposal.

This event is available to Gilbert utility residents and reinforces our commitment to safe handling, reuse, recycling, and overall diversion.

These programs reflect a strategic approach to diversion, improving safety, expanding access, reducing landfill reliance, and protecting ratepayer dollars.

Now that we reviewed the key rate pressures, including high vehicle replacement costs, increased repair and maintenance for an aging fleet, higher landfill disposal fees, and volatility in the recycling market, we will now move into the 2026 rate overview.

Our solid waste and recycling residential services include weekly curbside and trash recycling collection, 10 bulk uncontained pickups per year, and year-round access to our household hazardous waste facility.

Weekly curbside and trash recycling collection totals 1.5 million dollars and represents 85% of the residential services budget.

Uncontained bull pickups totals 1.6 million dollars and represents 12.5% of the budget.

The household hazardous waste facility totals $334,000 and represents 2.5% of our budget.

Looking at our residential five-year operating fund cash flows, expenses exceed revenues through fiscal year 28 and the ending balance dips below the minimum fund balance that year.

The model corrects in fiscal year 29 with the ending balance back above minimum by fiscal year 30.

This assumes a 2% revenue increase in April and does not include any additional rate increases through fiscal year 2030, assuming current market conditions hold.

We review our five-year plans every two years and make adjustments as needed to meet current demands.

Here is what this means for our residential customers.

The 2% revenue increase needed to support the pressure on our residential fund results in a slightly month increase for these services.

The standard 90-gallon trash and recycling service will see an increase by about 55 cents per month.

Residents who choose additional or alternative services will see increases ranging from 14 cents to 15 cents per month.

Again, this 2% increase is necessary necessary to support the residential operating fund and address the impacts from the rate pressures we reviewed.

Our solid waste and recycling commission commercial program is a voluntary service that includes frontload collection and roll-off service.

We currently serve roughly 20% of Gilbert's licensed commercial businesses.

This means nearly 80% are in the private market.

We adjust our commercial rates on a structured two-year rate cycle, providing predictability predictability and stability for our customers.

By contrast, private haulers such as Republic Services or Waste Management typically adjust their rates annually, they report quarterly, and in some cases, even adjust between monthly billing cycles.

They also assess additional fuel, environmental, administrative, and recovery fees that fluctuate over time.

Because we operate in an open market, these customers can choose the hauler they want for their services.

Our approach is transparent and deliberate while remaining competitive in the open market.

Looking at our commercial five-year operating fund cash flow, the ending balance at fiscal year 26 is at the minimum fund balance.

Projected revenues cover expenses through all five years, and by fiscal year 2030, the ending balance is above the minimum.

This model assumes a 20% revenue increase starting in April 2026.

No additional rate increases are included through fiscal year 2030.

Assuming marketing conditions remain stable.

We review and update the five-year plan every two years to ensure it meets operational and financial needs.

Here's what this means for our commercial customers.

Again, they can shop around, but our rates remain very competitive.

We're forecasting about a 13% increase in base rate payers.

Using this example of one three-yard container, we'll see a $12.45 monthly increase.

For customers with a second container, we currently offer a 21% discount.

Under the new rates, the second content container will receive a 17% discount, meaning the monthly increase will be $28.32 cents, bringing their new monthly increase to roughly 19%.

In short, we need to generate about 20% additional revenue to meet the needs of the commercial fund.

This approach adjusts discounts while keeping our base rates competitive in the open market.

These are roll-off and commercial rates, which also reflect minor one-time or monthly adjustments based on the services selected.

These services are available to both commercial and residential customers needing specialized waste removal for their homes, businesses, or large projects.

Customers can shop around, but our rates again remain very competitive.

Roll-off delivery, roll-off haul, and copactor halls represent the highest volume in this category.

They are charged per request and are increasing between four and a half to just over six percent.

Compactor haul will cost $16.60 more per service.

Disposal fees per ton are pass-through costs based on the highest landfill rate.

The highest landfill rate in the last rate cycle was $34.50.

Since then, just at the beginning of the start of this year, that rate rose to $44.66.

In short, we need to generate about 20% additional revenue to support the commercial operating fund.

Because we operate in the open market, these customers can choose a hauler they want for their services.

The commercial program is structured for cost recovery.

It gives businesses a reliable, locally accountable option while ensuring the service fully supports itself.

That concludes the presentation on the solid waste and recycling rates.

After questions, we'll transition to the water fund presentation.

Thank you for your time and consideration.

I welcome any questions you have on our rate pressures, the programs, or the proposed solid waste rate changes.

Questions.

Councilmember Lyons.

Yes, thank you for the presentation.

Back during, I think it was a fall retreat, we talked about and I didn't see it in here, the cost of potentially or the ability to be able to retrofit trucks to extend their work life.

Did you guys look into that?

Mayor, Councilmember Lyons, yes, we did look into it.

Um we reviewed some of our past history.

We had done that in the past, and some of the age vehicles that you saw in that previous chart include some of those models that were retrofit.

Depending on the retrofit or depending on uh the work that's done, it can extend the life by about two to four years.

It doesn't tip, it doesn't generate the life cycle that you would expect if you um do the body itself.

The body is the one that gets extended life.

The chassis continues with the regular cycles.

Same thing if you uh replace the chassis to a good body.

Whichever component is being replaced, there's still a secondary component that isn't being replaced, and that secondary component continues to age as well.

So we did we did look into it and we found that had we had the opportunity to replace those vehicles without COVID impacting the traditional replacement cycle, we wouldn't be in the position currently where we see the age vehicles that have been retrofit really drastically hitting our repair and maintenance.

What's the typical mileage that we see on the chassis in the drive train?

Uh mayor, council member lyons, that's a very great question.

I don't have that off of the top of my head, but I can absolutely get that for you.

Okay.

The second thing I'd ask at the fall retreat was about doing a comparison if we went out for an RFP to uh public providers, um, I mean private providers as a comparison.

Did you guys do that at all?

Mayor, council member lyons, uh given the time frame that we had to go to an RFP and investigate that would have delayed the statute process that we have to do to uh raise the rates in this rate cycle.

That being said, we evaluate this every two years.

Um part of internal conversations that we've been having was analyzing a cost of service model that would um play into what that would cost on the private side.

I uh, you know, when we had that discussion in the fall retreat, we did mention that typically other municipalities um will see a 10-year contract, 20-year contract as the contract matures or ages, increases do uh happen or services are reduced.

So in the long-winded answer, I will say that we didn't look for that in this current race cycle.

However, as part of the ongoing evaluations, it will be something that we'll consider.

All right.

On the slide you had about the uh waste generation per community, the benchmarking.

Did that uh was that data used?

And this might be a question for Kelly.

When we provide the um analysis to Wilden, I think they do the rate study for us, right?

When we provide the data to them.

Um they look at that benchmarking, are they looking at it per household uh for factoring that information, or are they looking at waste generation per individual?

Mayor, council member Lyons.

Um if uh Kelly uh clarifies what I'm about to say.

I believe I can answer this, but generally what they look at is our customer base and what we currently charge the customers on that we have.

They look at the growth projections in our system, and then they assign the rate that needs that's needed to support the expenses.

And so it doesn't uh look at the waste that's generated at the household level, rather the customers that are currently in the system.

All right.

Um then on the event where we do the exception um what I call exception items like the the electronic waste and stuff like that.

What would be the alternative if we didn't provide us uh an avenue like that?

The customer would have to take that stuff to the landfill themselves or dispose of it themselves in an appropriate place.

Is that correct?

Mayor council member, that is correct.

Yes, they would have to find an alternative solution, or um, we've seen them you know not be in compliant and continue to use our services to disposals, but to answer your question, yes, the landfill wouldn't accept those, those are specialized services, so a um special waste hauler would have to, you know, take those in.

There's some uh programs at hardware stores that will take some of those back as well.

So there's opportunities for the resid the resident to dispose of them safely.

We're absolutely mindful of the waste that's generated in our town, and so we want to provide those opportunities for our residents.

All right, thank you.

Vice Mayor.

Thank you, Mayor.

Um the commercial side, what's your projected loss of accounts due to the increase?

Uh Mayor, Councilmember, uh Vice Mayor Bon Giovanni, that's a great question.

Uh we're not projecting, we are currently at market value.

In other words, that we've assigned the rates to meet the base rate that's currently out in the private sector.

So we don't see that we will lose businesses to the privates because we're at that competitive edge.

What I will say is as time progresses, they will continue to increase their fees.

And so if we do see that people want to shop around, maybe they get an introductory rate that's highly competitive because they can adjust their rates in the private side.

We would see in theory as that contract matures, as the service is extended, the rates are you know evaluated on the private side and and raised.

We could in theory see those back.

Unfortunately, I don't have an exact data set to provide you on whether we will or won't lose.

I can't say that we're very competitive with the current rates that we're projecting.

Okay.

Thank you.

Any further questions.

Thank you.

Thank you.

Rebecca.

Quite a bit shorter than Isaiah's good evening, Mayor, members of council.

My name is Rebecca Hamill.

I'm the water manager for Gilbert.

In December, we shared with you a version of this presentation, and with council's direction, staff published the notice of intent to raise in to increase rates.

Tonight we're here to consider adoption of those rates, and this presentation will speak to the needs for these increases as well as the options available for full transparency with the council and with the community.

We want to first start off by acknowledging that these water rates are difficult, especially as household costs continue to rise across the board.

We recognize the real impact that this has on families and businesses in our community.

However, there's an expectation that we all share that water will always be there when we need it.

The town has an unwavering commitment to provide clean, safe, and dependable water, so our community can continue enjoying the quality of life that we're used to.

What we don't always see is the work behind that promise.

Reliable water only feels automatic because hundreds of people are constantly monitoring, treating, and delivering it so it reaches every home every day.

We know this is tough, and we wish there were easier solutions.

We are actively working to identify ways to help rates normalize in the coming years.

However, we cannot ignore that our once reliable water resources are diminishing, and providing water to residents now and into the future requires constant care and investment, which sometimes involves tough decision making.

Before we get into the technical details, it's important to remind ourselves that when we talk about water, it's easy to think of it some as something routine, something that shows up when we turn on the faucet.

But water is actually at the center of everything that makes daily life in Gilbert possible.

It keeps us healthy and safe.

It supports our schools and our hospitals.

It allows our firefighters to protect our community.

It powers businesses and keeps our local economies strong, and it's a part of what makes our neighborhoods thrive.

So when we talk about water, we're not talking about convenience or preparing for future growth.

We're talking about protecting life as it is right now for the people who already live here.

For families, for seniors, for kids, for every household that depends on water every single day.

Water isn't just a service, it's the foundation of our quality of life, and keeping it reliable is one of the most important responsibilities we have as a town.

As we walk through the pressures on our water rates, there really are three main areas creating financial strain on the water fund.

First, it's our water resources cost.

As drought continues and supplies shrink, the cost of securing water keeps climbing.

An ever increasing share of our budget is dedicated just to getting the water that we need.

Second, critical infrastructure projects.

Major projects like the Northwater Treatment Plant or our well drilling program are being hit by the same inflation and market pressures affecting construction everywhere.

And third, rising operational costs.

Chemicals, electricity, raw materials, and labor have all gone up.

These increases are touching almost every part of our day-to-day operations.

Let's first talk about the rising water resource costs.

We've been hearing news about the state of the Colorado River for many years now.

The river remains over-allocated, the reservoir levels are unstable, and the seven basin states have still not made an agreement for how to sustainably allocate the water the water that remains.

The deadline for the states to reach an agreement was on November 11th in 2025.

That deadline has come and gone, and the states failed to reach a consensus on new operating guidelines.

This means that the current operating guidelines will expire at the end of 2026, and there is currently no agreement in place.

This slide is showing us with real data that the watershed is declining, with both snowpack and runoff, and that means significant challenges for Gilbert.

The need to reduce water now is more real than ever.

This winter snowpack and accepted run expected runoff is poor.

Projections now show that Lake Powell could decline below minimum power pool, the lowest water level required to produce hydropower by later this year.

The model also projects dead pool within the next 20 years.

Deadpool is when there is no water passing through the reservoirs, no water in the Grand Canyon and this and in the CAP canal or to users of the Colorado River in Arizona.

Twenty years may seem like a long way off, but in the scheme of a river, it is the blink of an eye.

And the hydrology will demand further reductions past 2027.

Since the states failed to reach an agreement in November, the Bureau of Reclamation, BOR, has continued with their promise of making their own plans.

In January, BOR have released a draft plan with five alternatives for the states to consider, with a second deadline for agreement this past Saturday.

The states have again not come to an agreement.

The BOR will move forward with adopting new guidelines by October 1st of 2026.

The option shown on this slide is the no-deal alternative published by the Bureau of Reclamation.

This option is what the BOR believes they have the authority to enforce.

However, discussions are still ongoing.

If implemented, what this alternative could mean for Arizona is that the state would bear the burden of the largest cuts, up to a 77.4% reduction in our Colorado River supplies if the river continues to decline.

Arizona continues to advocate that all of those who benefit from the river must contribute to preserving its health.

However, the current hydrologic and political conditions on the river emphasize the importance of investing in our water resiliency in Gilbert and the criticality of our water security efforts through the Northwater Treatment Plant Reconstruction and the Well Development Program.

One thing to take away from this is that Gilbert planned ahead.

We have a plan and many projects under construction to make up for those lost supplies.

But being prepared for drought costs money.

But 41% of our supply comes from the Colorado River.

And that alone supports about 120,000 people.

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In 2026, we're losing 17% of that Colorado River water.

Some of it is required because the river is shrinking, and some of it is voluntary so that we can help stabilize Lake Mead and earn grant funding to support local conservation projects.

Arizona's water future is changing rapidly.

We don't know what 2027 will bring, but cuts for Gilbert could be as much as 57% of our CAP allocation.

That means 16,000 acre feet, over 14 million gallons per day, less water available to Gilbert from the Colorado River.

The construction of Gilbert's Northwater Treatment Plant and eight new wells give us the flexibility to access and deliver other water supplies when we face the deepest cuts on the Colorado River.

Gilbert is strengthening operations, managing our water sources carefully and pushing more conservation.

So even though we planned ahead, keeping water reliable takes real work and real investment to make sure that Gilbert has enough water now and into the future.

What all of this news about the Colorado River really means is that our access to water is getting much more expensive.

It now makes up nearly 20% of the entire water fund's operating budget.

We've been tracking these increases closely, and since 2020, the cost of CAP water has gone up 73%.

Putting that another way, the same amount of water we bought in 2020 now costs us $3.5 million more in 2025.

And it's not just CAP.

Communities across the region are turning to new water sources to make up for the shrinking Colorado River supplies, and those alternatives are getting significantly more expensive than they used to be.

For example, Gilbert purchased water from the San Carlos Apache in 2019 for just over $5,200 per acre foot.

Today, many communities in the valley are now paying more than $20,000 per acre foot for similar long-term supplies.

So the reality is simple.

Water is costing more everywhere, and paying attention to these increases now helps us avoid even higher costs down the road.

There we go.

As we look for ways to conserve water in the community, it's important to understand where water is being used most in Gilbert.

This graph shows that single family homes use the most water, most of the water in Gilbert, about 69%.

After that, commercial customers come next, then apartments, schools, and municipal buildings.

Because households use the biggest share, that's where we focus most of our water conservation efforts.

And here's why it matters.

Water in Arizona, a desert is scarce, and every gallon that we save is a gallon that we don't have to find, buy, treat, and deliver.

And that saves money for everyone who pays a water bill.

Our research shows that outdoor watering is one of the biggest reasons water bills go up.

It's also water we don't get back, which makes it especially challenging in a desert community like ours.

Gilbert is very efficient with the water used inside of our homes.

We clean and reuse 100% of indoor water as reclaimed water.

That means showers, sinks, and washing machines all help us stretch our supply and keep long-term costs down.

Outdoor water use works differently.

50 to 70% of water is used outdoors for lawns, landscaping, and irrigation, and it's gone for good.

It doesn't return to our system, and we can't reuse it.

It puts more pressure on water supply and makes it more expensive to replenish.

So when we talk about conservation, it's outdoor water use that makes the biggest impact, both for individual households and for the community as a whole.

Water conservation isn't just the right thing to do.

It actually saves us money.

Using less water outdoors means lower bills for customers and less pressure on our overall water supply.

We offer a lot of programs to help people cut down on outdoor water use, and many residents are already taking advantage of them.

In 2025, we completed 842 checkups with an estimated annual water savings per home of 65,000 gallons.

In total, our water conservation efforts saved 54.7 million gallons in 2025.

This shows that our conservation programs are working, but we also know that it costs money to run these programs.

And so to offset those costs, our water resources and conservation team helping help bring in over 28 million dollars in state and federal funding for water saving projects in the past two years.

Not only is water conservation cost effective for the community, it's responsible use of our water resources are required.

In 1980, Arizona recognized that our groundwater supply was not unlimited, and the state created the Arizona Groundwater Code to protect it.

Areas that relied heavily on groundwater were placed under special management rules called active management areas or AMAs.

Gilbert is a part of the Phoenix AMA, one of the largest and most regulated in the state.

As a member of the Phoenix AMA, we're expected to balance how much groundwater we pump with how much we put back into the aquifer.

In other words, we can't withdraw more groundwater than we replenish.

To stay in compliance, Gilbert has to follow a number of best practices, and we take those seriously.

Some of the ways that we do that include running our water conservation programs, offering resources and tools for customers, hosting community education events, tracking and reporting our conservation process, using a tiered rate structure to encourage smart water use, monitoring and reducing water loss in our system, and protecting groundwater and replenishing what we do use.

All of those efforts help make sure we're managing our water supply responsibly now and for the future.

Now that we've talked about the water resource pressures on the fund, the next pressure I'll be talking about is our aging infrastructure.

One of the biggest pressures on our water rates comes from aging infrastructure and the rising cost of fixing or replacing it.

Even though inflation has certain has started to level out in some areas, construction costs are still really high, especially for big heavy-duty projects like treatment plants, wells, and major pipelines.

These are the kinds of projects that keep water flowing safely to every home and business every day, and avoiding these means risking failure of this critical infrastructure, which is not an option.

So while things are stabilizing a bit, the truth is that building or repairing essential water infrastructure is still a lot more expensive than it used to be, and that puts real pressure on our water budget.

In short, the work we have to do hasn't changed, but the price of doing it has gone way up.

Oh, the biggest projects we're committed to, and one of the most important is the Northwater Treatment Plant Reconstruction.

The project is the largest investment in Gilbert's water system and a major part of our long-term resiliency.

Here are some quick by the numbers on the project.

The good news here is that we're making huge progress.

We've officially passed 50% completion, and we're now less than 200 days away from the treatment complex coming online.

And less than 400 days from fully transitioning the water production of this brand new facility.

Once it's finished, the Northwater Treatment Plant will provide 70% of Gilbert's entire water supply.

That's enough to serve about 250,000 residents with a maximum treatment capacity of 60 million gallons per day.

This isn't just a construction project.

It's a 50-year investment in Gilbert's future that will serve our children and our grandchildren.

The treatment plant ensures that our water services remain reliable, safe, and available as our community grows.

Another major initiative we're investing in to keep Gilbert's water future secure is our well program.

This program gives us access to groundwater at various sites across town, and it's a huge part of our long-term water resiliency strategy.

These wells are especially important during drought conditions, including the shortages we're already seeing on the Colorado River.

And here's where they stand now.

We have a total of 20 wells that are currently available within our water portfolio.

Those 20 wells are capable of serving up to 52,000 residents.

We also have eight new wells under construction that will be added to our groundwater portfolio.

Drill is complete for these wells, which is a major milestone.

However, finding water in the desert is a challenge, and finding high quality water is even more rare.

So some of the wells that we drilled have mixed water quality challenges.

We're now working on the treatment and blending designs for the sites that need it to make sure that the water meets all safety and quality standards before entering into the system.

So just like the Northwater Treatment Plant, this well program is another big strategic investment to maintain Gilbert's water resiliency, both today and into the future.

It gives us options, stability, and flexibility when our other supplies face pressure.

So not only are we seeing cost increases on our major infrastructure projects, we're seeing rising costs across nearly every sector, which means that treating and delivering the water like we have always done now costs more.

The next rate pressure I'll be speaking about is how those operational costs have increased.

So while inflation has certainly stabilized in recent years, the uncertainty remains in many areas of the market, and Gilbert's operating costs continue to rise.

Major impacts to chemical and electrical costs resulted in the department adding over $600,000 to the budget in chemical and electrical alone.

These costs can be attributed to local and national inflation in all sectors of the market, leading to limited manufacturers and small labor pools available in highly specialized sectors.

Increased cost of skilled labor leads to manufacturing and supply cost increases, especially in areas like mechanical or electrical components that we use to keep the water system running.

Nationally and internationally, we continue to see impacts from uncertainty with tariff and trade.

And locally, we're now competing with other large valley-wide projects, which makes sourcing highly skilled labor even more challenging.

All of these various factors place additional pressure on the water fund and lead to higher operating costs.

Now that we've covered the three main areas of cost pressures on the water fund, I want to talk about ways in which we've saved money in the budget.

And Gilbert, before we ask for any rate increase, we always exhaust every available measure of cost reduction, alternative funding, or project prioritization.

Raising race is the last resort.

So before asking council to consider rate increases, we took a hard look at where we could save money, request funding, or adjust plans, and we were able to make some really big impacts.

Some projects, like updating older water lines, were safe to delay for a short amount of time.

The risk is still manageable right now, but it will grow the longer these projects are delayed, so we'll still need to make those happen.

We were also successful in pursuing alternative funding, including grant awards and state appropriated dollars, which directly offset the cost of project expenses.

Savings from value-based engineering and fiscally responsible budgeting practices also help us stretch the fund even even further.

Altogether, we were able to reduce, avoid, or reprioritize 239 million dollars.

All of this helped lower the overall costs and keep the community's water system moving forward in a responsible way.

Without these cost-saving efforts, we would be looking to raise rates significantly more.

An increase of more than 55% would have been required in 2026 if we had not been able to reschedule, reduce, or generate revenue to help support the fund.

So now that we've covered all of the pressures on the water budget, I'll be talking about what goes into utility rates, a history of increases, and how our current rates measure up.

Okay, so let's talk about something that can get confusing.

Here is the difference between impact fees and water rates.

They sound similar, but they pay for totally different things.

Impact fees or system development fees are charged when a new development is built.

These fees help pay for the parts of the water system that need to grow because more people are moving in.

Things like new water treatment plant capacity, new wells, expansion to the distribution system.

And basically growth pays for growth, and impact fees cannot be used for everyday system needs like repairs or operations.

They only fund expansion.

On the other hand, water rates are the monthly user fees that we all pay based on how much water we use.

Rates fund things that keep the water system running day to day, like operations and maintenance, chemicals and power, repairing or replacing aging infrastructure, or existing debt payments.

Rates cannot be used to expand the system for new residents, and they also don't fund general government services like police, fire, or parks.

So in short, impact fees build new capacity for future users, and rates maintain the system we all rely on today.

When we say water pays for water, this is what we mean.

Water rates have to cover everything it takes to run the system, operations, maintenance, repair, and debt.

Tax dollars do not pay for water.

Those are used for things everyone shares, like parks, police, and fire.

And the cost of service means we only charge what it actually costs to provide water, not anymore.

If we drift away from these financial policies, it could hurt Gilbert's credit rating, which makes projects much more expensive in the long run.

While this might be redundant, we want to make it clear what water rates pay for.

The water fund utility rates are used to cover the costs associated with water resources, water treatment, water system maintenance and repair, and replacement of water system infrastructure.

And water rates do not pay for costs associated with new developments.

System development fees are paid whenever a new connection to the water system is established, and those feed fees cover the costs associated with additional water resources, water transmission infrastructure needed to deliver water to that development.

Water rates also do not pay for any streets projects, quality of life projects, or other town services that do not directly support water operations.

Similarly, each of the other three lines of service in the utility bill are also solely used to fund the operations of those services.

A typical utility bill is made up of four lines of service solid waste recycling, sewer, environmental compliance, and water.

Water is made up of two different charges.

There is the fixed base fee, which is based on the size of the meter, and there's the volumetric fee, which is based on the amount of water used.

The only thing that's changing month over month is the water usage amount.

Everything else is fixed.

To dive a bit deeper into utility bills and how tiers relate to usage, the biggest group by far is the lowest tier.

Of the over one million utility bills collected each year, about 50% 57% of all residential water bills are for homes using zero to 8,000 gallons per month.

That's normal indoor use.

Drinking, bathing, laundry, cooking, and the essentials.

Our water rates are set up in tiers on purpose.

Water in the lowest tiers cost less to help keep the essentials affordable for everyone.

Water in the highest tiers cost more to encourage conservation, especially for outdoor watering, which uses the most water.

Now, if we look at the other end of the chart, only 1% of all bills consumed more than 50,000 gallons a month.

That group uses 7% of the town's total water supply.

So the tiered structure helps keep basic use affordable while encouraging high volume users to conserve.

This is another way of looking about at how a utility bill changes as water use goes up.

The fixed parts of the bill, sewer, solid waste, recycling, and environmental compliance, and the meter base fee are all across the bottom and all stay the same no matter how much is water is used.

What really changes is the consumption charge.

At low usage, the bill is mostly made up of those fixed fees.

And as usage increases, the volumetric charge grows and becomes the larger part of the bill.

So the story is simple.

If you use less water, your bill stays lower and more predictable.

However, if you use more, the variable the variable charges rise.

I want to make it as clear as possible that when we're talking about a water rate increase, we are not talking about increases to the total bill amount.

For water, we are talking about increases to the meter base fee and the consumption.

Because individual bills are so different, the amount the bill is increasing and the percentage increase of the total bill will vary.

Now that we've seen how water usage drives the bill for the standard three-quarter inch meter, here's an example of the one-inch meter.

The overall shape of the chart is similar.

Fixed charges stay steady and the volumetric charges grow with usage, but there's one key difference: that the meter base fee is higher for the one-inch meter.

You can see it in the red-orange band.

And why is that?

Larger meters are designed to deliver more water faster.

That means they place a greater demand on the system and require more robust infrastructure to support them.

The higher base fee reflects that increased capacity.

It's not about penalizing larger properties.

It's about ensuring the system is funded fairly based on the service level provided.

So this slide helps reinforce that utility rates aren't all one-size-fits-all.

They're carefully structured to reflect both usage and system impact.

For customers with larger meters, it's important to understand that the higher base fee isn't just a flat charge, it's tied to the scale of service they receive.

What we can also tell from these two graphs is that a customer's water bill is highly individual, and it depends on each customer's situation.

Now, we realize that many customers are struggling with increases to their utility bills, and it's important that Gilbert's water services remain affordable.

Recently, the ASU Kyle Center for Water Policy released a report on tap water affordability.

In this report, the study evaluates the household burden of water services in communities in Arizona and nationwide.

The report calculates the household burden as the cost of water service for 4,000 gallons, the minimum needed for daily use in a small amount of landscaping as a percentage of monthly income of the 20th percentile of earners in the community.

A value less than 2% is considered affordable.

The report shows that Arizona on average is 1.42%.

The national average is 1.44%, and that Gilbert's affordability is only 1.01% of the monthly income of residents making the 20th percentile of income.

Even though Gilbert's water meets the definition of affordability, we realize that many customers in Gilbert are still struggling to keep up with rising costs.

This is why we offer utility billing assistance for residents making up to 120% of the area and median income, which is approximately 79,000 for a single income.

Or any residents receiving assistance from other programs automatically qualify.

The discount covers $30 a month towards the utility bill, and to date we have 730 clients up from 591 in December.

We have given over 122,000 in discounts.

And as we evaluate utility rate increases, we continue to monitor and adjust this program to provide assistance to the residents who need it most.

So this may look familiar, but I want to explain this timeline because the context for these rate increases matters.

We know that the rate increases over the last three years have been difficult, and we understand how frustrating that feels.

So when you look back, part of the reason is that for a long time rates didn't change at all.

All water rates stayed the same for eight years, solid waste went even longer, 13 years with no increases and even a couple of decreases.

That might sound like a good thing, but the cost didn't stop rising during that time.

Infrastructure still age, water got more expensive, and eventually all of that caught up at once.

So instead of small, steady changes over time, we ended up needing a much bigger increase closer together, and that's the situation we're in now.

To avoid repeating that, the town consistently reviews utility rates.

We're now nearing the final part of a three-phase water increase, and that's important.

Once this phase is complete, we are optimistic that the utility funds will be more stable.

This gives us the ability, if increases are needed in the future to make them smaller, more predictable, and easier to manage.

This is about learning from the past, enabling regular check-ins with gradual adjustments to help prevent long periods of inaction that lead to bigger problems later.

So to remind everyone, in 2023, there were three options presented to council and the public works advisory board to consider.

These were the cash option, which required 130% immediate increase to rates, but included no new debt.

There was the bond option, which required an immediate increase of 95% and included a bond for $25 million.

And there was the cash bond gradual option, which was recommended by the Public Works Advisory Board and adopted by council.

The board and the council preferred this option because it minimized the negative impacts of interest from new debt and spread out impacts to water bills over several years to give the community time to adjust.

This option included a 50% increase in 2024, 25% increase in 2025, and an expected 25% increase in 2026.

We're here tonight to discuss the options for this planned third year of this plan's increases.

There we go.

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Now that we have an understanding of Gilbert's financial policies and what goes into the utility bill, we have two options to go over for the 2026 rate increase.

So before bringing these options before council, we first brought them to the Public Works Advisory Board.

This board reviews and makes recommendations to the town council on the strategy, approach, and fund planning of initiatives and large scale infrastructure projects across all divisions of the public works department for the current and future needs of Gilbert.

For this evaluation, the Public Works Advisory Board reviewed water and solid waste recycling fund pressures.

They evaluated three rate options for water and one for solid waste recycling.

They requested an additional two options for water, and ended up recommending one option with support of a second option for the council to consider.

The Public Works Advisory Board carefully considered all of the factors of these rate increases and used the following five criteria to make informed, balanced recommendations.

First, the board considered short-term customer impact and how these changes will affect our customers immediately, balancing immediate affordability with future stability.

Operating fund capacity ensures that we can maintain daily operations efficiently without compromising service quality.

The repair and replacement fund capacity is our safety net for infrastructure upkeep and emergencies, ensuring that we can address issues promptly and responsibly by planning for repair and replacement of aging infrastructure.

The total cost of ownership was another key factor of the board's analysis, which is about understanding the full financial picture over time, not just the initial costs, and ensuring sustainable financial health.

And finally, the long-term customer impact.

The board carefully considered the alternatives to weigh how these decisions will affect our community's future, balancing short-term needs with long-term costs.

The board then assigned a ranking to each option based on the decision-making criteria with a weight applied from previous rankings.

Option E was ranked number one.

This plan suggests a phase increase of 14% in April of 2026 and another 14% of in April of 2027, which is a modification of the planned 25% increase that was proposed in 2023.

Option A was a close second following the original planned increase and considering long-term impacts to customer bills with a single one-year increase.

Option D was dirt was third due to the high rate increase required to avoid taking on new debt to the fund, followed by options B and C, which issued more debt than the other three options.

These rankings helped the board weigh our immediate needs against long-term sustainability, and each option carried its own benefits and drawbacks, which we'll see more clearly as we delve into the specifics of option E and options A next.

Option E was structured with a progression, a 14% increase in both 2026 and a 14% increase in 2027, followed by smaller adjustments in the following years.

It's important to understand that since we evaluate rates on each fund every two years, that the rates shown for 2028, 2029, and 2030 are estimates.

We don't know what the future will bring, but expect that adjustments moving forward will be smaller.

This phased approach aims to balance immediate needs with long-term sustainability, keeping customer impact in mind while meeting the funding needs of both ongoing operations and repair and replacement.

Option A follows the initial plan.

It includes a 25% increase in April of 2026 with no planned increase in 2027.

Again, even though we're not adopting years 28, 29, and 30 tonight, we don't know what the future will bring, but we're expecting modest increases going forward.

This plan excludes some new debt for major infrastructure projects and supports ongoing operating needs while setting aside funding for repair and replacement of critical infrastructure.

Option A generates higher revenue in 2026 and 2027, which better supports the projects that are currently underway and ends with a healthier fund balance in the operating fund than option E.

While the Public Works Advisory Board initially scored option E higher than option A, after further discussion on the differences between the options and the ultimate customer bill impact over both 2026 and 2027, the board ultimately recommended option A.

In the following slides, I'll show you these rate increases in a few different ways to highlight the differences between those two options.

So on this slide, we see the water utility bill for a three-quarter inch meter and a comparison between the current total utility bill, option A for a three-quarter inch meter, option E for 2026, and option E for 2027.

We can see that option E for 2026 is lower than option A.

However, option E for 2027, when taking into account those two planned increases, is higher overall than option A.

And we see the same trend for the one inch meter.

There we go.

Now looking at it at this in a slightly different way, we have an example utility bill overview for a minimum usage water user.

This could be a 1,500 square foot home with a desert adapted landscape, using efficient appliances with low indoor water use, very conscious of utility costs.

A three quarter inch meter for 4,000 gallons a month.

Here are the options before us the current total utility bill compared to option A.

Option E, we see 2026 being lower, but 2027 exceeds option A.

Likewise for the one inch meter, we see the same trend.

Here's an example for low water usage, 8,000 gallons per month.

I'll move through through these pretty quickly, but I recommend to anybody who is curious about what their water utility bill could look like to go online and find our utility billing calculator, and it could tell you exactly what your monthly bill will look like with each of these two options.

And we see an above average water user at 15,000 gallons per month.

This could be a moderate single family home, medium-sized yard with grass and a play area, pool, sprinkler, slip and slide in the summer, four people, meeting multiple daily showers or baths in a higher indoor water use.

And then we have our 25,000 gallon per month high usage home, followed by our very high usage at 45,000 gallons per month.

So comparing all of these together, here is option E for that low, average, above average, high, and very high usage.

For three-quarter inch meter, we see option E in 2026 and option E in 2027.

In option E, we see for the low usage, for an example here, $7.36 increase in 2026, followed by a $15.79 total increase for 2027.

Now compared to option A, a little bit simpler here, we see our current, and then we see the dollar amount increase in option A for the three-quarter inch meter and the one-inch meter for again those low usage, average usage, above average usage, high usage, and very high usage customers.

Again, we want to make sure that our water bill meets the affordability criteria for 4,000 gallons of water.

That's the criteria is when the cost for 4,000 gallons of water is less than 2% of the monthly income at the 20th percentile in the community.

For our current rates, we are looking at 1.01% for option A, which is for both 2026 and 2027, we see 1.26% for option E, while it is more affordable in the first year 2026 at 1.15%.

Option E in 2027 exceeds option A being at 1.31%.

So while affordability for 4,000 gallons of water per month is an important factor, we know that many customers use more water than that.

This chart shows a more typical amount of water usage, around 8,000 gallons a month, and we can still see that Gilbert falls in line within the region of our peers.

The gold portion shows the meter base fee, which we set at 50% of revenue to help stabilize the water fund, and the blue portion represents the water actually used.

When we compare Gilbert to other cities, both today and with these proposed options, we're still in the same range as many valley communities.

We aren't at the top and we aren't at the bottom, relatively in the middle.

We also know that many of our neighbors are considering rate increases also and expect to be closer to the middle of this range as their rates go up across the state.

This helps show that even with the changes we're proposing.

This slide looks at household usage for a very large amount of water, about 40,000 gallons per month.

Even at this higher usage level, you can see that Gilbert remains competitive with other cities.

The gold bar again is the monthly base fee, and the blue bar shows the cost of the actual water used.

Gilbert's current rate and future options sit right around the middle of the chart.

And this is intentional.

Our tiered water rates are designed to encourage responsible water use and conservation, but they also keep Gilbert's pricing fair compared to what other cities charge at high usage levels.

So another way to look at it, instead of looking at the water portion of the utility bills, this chart is comparing the tiered cost per thousand gallons across different cities in the valley.

The gray lines show what other cities charge, while the colored lines show Gilbert, both our current rates and the options being considered for the next few years.

What's important to see here is that Gilbert stays right in the middle of the pack.

Even with the proposed adjustments, we're still comparable to many of our neighboring cities.

Some cities have higher spikes in their tiers because they charge more for higher water use.

Others are lower, depending on their own water supplies and their own infrastructure needs.

But overall, Gilbert's rate structure stays well aligned with what we see across the region.

So now we've most focused the majority of our time today on the residential water increase.

We have to acknowledge that Gilbert's commercial and non-residential would also seem the see the same percentage increase.

And so here's option A with a 25% increase across all meter sizes and all non-residential usage types.

And here is option E for 2026.

You can view the full rate study located on our website for the full analysis of the 2026 non-residential rate increase.

So I realize this is a lot of text, but this is a letter written by the Public Works Advisory Board expressing their recommendation.

And I'll read it.

As Gilbert residents ourselves, every member of the Public Works Advisory Board carefully weighed the economic impact that any rate increase would have on the community.

We spent considerable time evaluating the options, striving to identify an approach that minimizes the immediate burden on residents while also avoiding the risk of shifting higher costs or additional debt onto future generations.

The option we recommend reflects what we believe to be the most balanced, responsible, and least impactful path forward.

Based on our evaluation, the Public Works Advisory Board recommends that the town council approve, this is the recommendation for the notice of intent, a notice of intent to increase ratings and fees at the meeting on December 16th, 2025, and set a public hearing for February 17th, 2026, where we are today.

We further recommend that the council adopt option A for the water fund as it best balances short-term affordability per residence with the long-term financial needs of the water system and the continued resiliency of this essential community research.

Written Sam Elliott, Public Works Advisory Board Chairperson.

We've heard the concerns both from council and the community about the unique challenges that these rates are creating for small agricultural business.

And as a result, we want to give you an update on the agricultural water rate.

Earlier tonight, you heard from Lauren Hickson about the framework that was developed by staff in collaboration with local farmers and small businesses.

I want to briefly remind council and the public what that framework is designed to do and outline the next steps ahead.

Okay.

So we heard the request.

The request was that water rate increases have affected large residential properties that support livestock and local food production, which are key elements of Gilbert's rural heritage and small town character.

So our goal was to identify options to ease this rate burgeon while ensuring fairness for all customers.

Okay.

And this rate approach, apologize for that, was establishing criteria that would allow qualifying properties to switch from the tiered residential water rate into the landscape water rate.

And the reason why we are proposing the landscape water rate is because it is approved rate that does not require the establishment of a new water rate structure through a water rate study.

The landscape water rate was selected because the customer water use is outdoors, which peaks in the summer and has a greater greater impact on the water system.

It's what's charged to commercial customers for their outdoor water use.

And the land, excuse me.

The landscape water rate applies to all water use by the customer, as a new meter is required to separate billing between indoor residential use and outdoor use.

So that is our approach.

And we developed this eligibility criteria, including customer requirements.

Those requirements would be that the existing they're an existing residential water customer within town limits.

They have an active business tied to water use as of December 31st, 2025.

Their property characteristics would be greater than or equal to 35,000 square feet, as that is what is allowed in our code for livestock and commercial agriculture use.

They would not have an exempt well.

If they have greater than two acres, they are complying with the Arizona groundwater rule.

Their water use maximum area of grass would be 3,500 square feet, maximizing available flood irrigation if that is available to them, limiting water use to the highest three years of annual use, and that they are in compliance with our land development code, cross-connection audit, and water efficiency checkup.

So just some summaries from our presentation earlier tonight.

And so in this study session, council directed staff to bring the framework back for an agricultural rate implementation back to council for the March 3rd meeting.

Now, before we get to any questions from council, Candace will present our communications overview since the notice of intent.

Afterwards, I would be happy to answer any questions that you may have.

That handed to Candace.

Good evening, Mayor and Council.

Candace Quan, Chief Communications Officer.

We're gonna go over the utility rates outreach since last seeing you guys in December.

As a reminder, the goal was to ensure majority of our customers are informed.

That's approximately a little over 90,000.

And how we achieve that is to make sure we're meeting customers where they are, where they're consuming that media.

Before we get into median consumption, just a reminder of the key messages that we're focusing on.

As you guys know, as you've seen, water is life, and it's getting extremely harder and more expensive to provide.

Before raising rates, as you saw, Rebecca had said, we cut or divert every cost we could.

Most customers are in fact average water users, and Gilbert's rates are higher, but do remain affordable.

And growth pays for growth.

You've seen this before.

This is our media consumption based off of our demographic here within Gilbert.

Uh, as expected, digital is highly the most consumable.

Social, of course, we can't forget about traditional and print.

Because of that, we have a vast communication outreach toolbox, anywhere from print, email, social media, paid ads, website, of course, uh, our Gilboard 311 app, digital displays, even surveys, and then long form video.

Within that, here's just a high-level overview of the outreach timing that we've done since December.

We did the notice of intent, and we haven't stopped pushing out outreach to all residents and over 90,000 customers.

Down here is just a full glimpse of we exhausted every single outreach effort to ensure everyone was informed of the potential rate increase, whether it was utility bill inserts, uh, printouts, paid ads, and long form video.

Here's just examples, what starting with the notice of intent.

Here's just a snapshot of the notice of intent via social in our newsroom, some high-level analytics to understand kind of the views that we got, overall engagements and links into more information.

We continued to inform and educate.

We had a landing page of all the resources that customers can take advantage of, whether it was utility build calculator, whether it was utility billing assistance program, also to get more educated and informed about why we had may need to increase the rates.

All of the information that Rebecca shared with you today in a more thumb-scrolling friendly uh approachable manner via online.

And then, as of late, I'm sure you guys have seen the video.

Just as of this past uh today, it's gotten over 20,000 views in just a week.

Again, another digestible way, it's about seven minutes long, but water is a complex topic, and so hopefully it's gotten more informed citizens to understand what we're facing here in Gilbert.

Uh we also engaged in two-way communication.

We hosted two open houses were completed, and nearly a hundred participants came.

The round table was similar to those listening sessions where there was round tables with Mayor and Council, but there was also experts from town staff, whether it was from water conservation, solid waste and recycling, utility billing and budget and finance were also available to speak directly with uh customers.

Overall, the themes were water rates, of course, the number one concerned.

Over 80% of residents asked questions or shared concerns about rates, especially how increases affect their household and how bills are calculated.

Also, growth and fairness matters.

Many residents wanted to reassure that new developments are paying their fair share and not shifting costs into existing neighborhoods.

Bills need to be easier to understand.

Some residents shared confusion about their bills and wanted clear explanations and examples.

Of course, trust and transparency are key.

People wanted simple, honest info, what's changing, why it's happening, and what it means for them.

So we want to just send our sincere thank you to those residents who attended as people like them who help help shape Gilbert.

Here is a glimpse of you know the feedback that we received since putting out that data story and that video.

When people are worried about their bills, they usually head online.

Those conversations feel loud and often represent a smaller yet highly engaged group, not the entire community.

That feedback still matters because all voices matter.

And with the recent release of our data story and video, we're seeing something important happen.

The feedback on the screen shows people are becoming more informed.

No one likes rate increases, but more in residents understand why they're happening.

Gilbert is nearly 300,000 people.

Most residents engage quietly by paying their bills, conserving water, and trusting the system to work.

They matter too.

Your role, our role is to listen widely and decide decide responsibly, balancing strong opinions with the essential needs of the majority who expect steady service and proactive planning.

And with that, I'll bring Rebecca back to talk about next steps.

Thank you, Candace.

As we close, we want to be clear on the next steps.

What we're asking for tonight is approval to adopt the solid waste and recycling, residential and commercial rate increases as presented, and adopt either option A or option E for water.

These rates will go into effect on bills starting on November 1st, 2026.

I'm sorry, April.

I don't know why I said November.

As a reminder, here are the two options before you for water.

There's option A, which includes the 25% increase in 2026, and option E, which includes a 14% increase each year for 2026 and 27.

And the proposed solid waste and recycling rate increase of 2% for residential and 20% approximately for commercial.

And with that, I'd be more than happy to take any questions.

Thank you.

Thank you, Rebecca.

Questions for Rebecca or Candace.

Council Member Lyons.

Sorry.

I have questions for Rebecca and for Kelly.

So Kelly, yours is only going to be one question, and I'll get there in a second.

Rebecca, how do they allocate the water for the town of Gilbert as you know part of our Colorado River allotment?

How does it determine how much water that we get?

I'm going to phone a friend to Eric Brown, who I think is in the hall, the audience.

Oh, there you go, Eric.

Who can speak to water resources much better than I can?

Thank you.

All right.

Good evening.

So the Colorado River allocation to the town of Gilbert came through several different contracts.

First is a subcontract with the CAP that was allocated in the 1980s to the town based on current size, which we were very small at that time, as well as our other alternative water resources like Salt River Project.

As the town grew, we grew in lands that are farther outside of the Salt River Project lands that don't have water rights associated with them.

So the town underwent numerous acquisitions of water supplies, either through Indian water rights settlements or through straight up leases with other Indian tribes that had water supplies.

So we've been very active over the last several decades in acquiring new water supplies.

Those supplies have different variabilities as far as their reliability, although they're all Central Arizona project water supplies, which are at the lowest priority on the Colorado River in the entire basin.

Okay.

Which makes up about 40% of our renewable water supply.

All right.

And with that, how would we make that up?

There's multiple sources.

In the short term, we're drilling eight new wells in those areas that are served by the Central Arizona project.

Those wells will draw on our stored groundwater that we've stored in advance for times like this.

That is a short-term bridge to a long-term future where we have less renewable water supplies.

So conservation comes into effect where we will need to necessarily reduce our water use over time on the per person basis.

And then additional water supplies that we could import from other places outside of the state or within the state.

Those are the very expensive water supplies that was shown on the chart, where we paid $5,000 per acre foot as recently as six years ago, and other towns are paying upwards of $20,000 per acre foot today.

I understood that one of our neighboring communities paid through the nose for that allocation.

So Kelly, this is where you would come in.

How would this impact our future rates then if this is enacted?

Because it it seems like we're at an impasse as far as negotiating these different allotments for the states in the upper and lower basin.

If this if we did, and one of the questions I have is why did we take the lion's share of that cut?

I mean, you look at the other states there, like California had none, the upper basin's all had none, yet us in Mexico and and Nevada had the cuts, but our cut was 77%.

Do you have any idea why that's the case?

Or maybe Rebecca, that would be you, but that would have to be Lauren Hickson or Eric knowing on why we took the cuts.

Yeah, my question for you, you can be thinking about this is how would that impact our future rate increases if this cut goes into place?

So Eric, go ahead.

Okay.

Um the Colorado River is um an incredible entanglement of federal laws, state compacts over the last century plus.

Um the shortest answer I can give you is that um in order for the Central Arizona project to be built beginning in 1968, Arizona set um the Central Arizona project as the lowest priority among all of the states in the basin.

That's there's seven states in the basin.

And so the other six look at us and say, you guys are lowest on the totem pole, you will be cut first, we will hold you to the letter of the law.

Obviously, we have grown in the in the Phoenix Valley and in Tucson on this renewable water supply, and to have it completely drastically cut is not in the state's best interest, both economically as well as as civilly.

Um so the state's position is that that is an untenable solution, but the federal government views that as reading the letter of the law, which is what they believe at this current moment is the only thing they are able to do, which is hold us to the letter of the law, which says the Central Arizona project will be cut entirely before California, Nevada, or the upper basin states.

So that's how we got to where we are.

So that language was drafted 60 years ago almost.

Yes.

Okay.

So Kelly, this comes to you.

What does this do to future potential rate increases?

Your projections is this just came up yet, you know, you guys provided the information to weld in the per to give you the the rate analysis.

This wasn't factored into it, was it?

We have the infrastructure that we're planning for potential cuts on the Colorado River, which is why we have well projects included.

Um if those cuts are long term or how deep those cuts are, it may impact the additional infrastructure we might need.

I don't know what that looks like.

Um, and so I don't know financially how that will impact it.

We'll have to continue to watch.

Um we may have to purchase additional water rights to make up for this, which would be very expensive.

Uh we may have other options about improving our reclaimed water use.

We'll have to look at all of those options at that time and continue to watch our water rates as this drought unfolds and as the cuts unfold.

Okay.

Um have we looked at, and Rebecca, that thank you, Kelly, that would be it.

Rebecca, have we looked at?

I know that only 22 percent of the usage is from commercial, but have we looked at in, and Eric, this may be to you as well.

Um, have we looked at our commercial customers to see what kind of conservation efforts that they've got in place?

We have conservation programs that target our commercial customers, the waterwise Gilbert program, especially is targeting commercial users where they can advertise as water wise Gilbert businesses.

Um many of our programs target residential because that's the majority of our use, but we have a fair number that target commercial.

The HOAs are in consider are part of that water wise, right?

That's correct.

HOAs are considered commercial in our billing structure.

Okay.

And uh where are we at with the uh water meter um assessments?

How long before that's completed?

Do you guys know?

Uh we expect to give an update to council in March.

All right.

Reason I asked that we got an email from today I that I noted that somebody hasn't had a water bill in three months, and so I I wonder just a little bit the data that we're using, and Kelly, this is directed maybe your direction on our projections.

Have we factored in that disconnect that we saw with uh the meters that we brought this third party in to evaluate?

Was that factored into determining this rate when you did your projections?

We have an elasticity factor factored into the water rates that water usage might change, and so that would cover some of that unknown or variability there as water rates go up and people change some of their habits.

All right.

But are we meeting with the with the increases that we have done to date?

Are we meeting exceeding or falling short of our revenue projections?

We are currently behind revenue projections, but I don't know how much of that is related to change in water use and how much is people not paying their bills because there's not late fees in place right now.

So once we get normal billing back into place and we can catch up on that data, we'll have a better look.

Am I correct in thinking that there's about 6,000 people who for have foregone paying their bills right now?

Is that sound about right?

We have about it was 5,000 last I knew it may be up to 6,000.

Okay.

All right.

Thank you.

That's all I have.

Councilmember Torres.

A couple off questions, and you may have them uh answers.

There's a lot of people that are using let's say landscape water, but they're not using non-potable.

Is there something we can do about keeping the potable water for residents and not having so much of it put into whether it be a golf course or whatever it is, because we're we can't continue to promote uh grassy areas when we're discussing right here what's bordering on rationing of water.

We're talking about forced reductions.

What can we do about not allowing that?

So, Mayor, Councilmember Torgeson, great question.

All of the water in Gilbert is spoken for, whether it's potable drinking water, whether it's reclaimed water, whatever reclaimed water we are not using to irrigate, we are using to put back in the ground, store it as credits, and withdraw it later on from our wells.

And so the ultimate solution is conservation or changing the way that we use water in Gilbert for a more sustainable future.

But we were discussing earlier how some of these large areas were using potable water, correct?

That's correct.

But whether it's potable or reclaimed water, it it is ultimately used.

If they converted from potable to reclaimed water, that isn't necessarily a resource that would otherwise be going to waste.

We are recharging that water for potable credits later on.

Okay.

I'm not making myself clear, so I'm gonna abandon that thought process.

I apologize if I'm misunderstanding your question.

No, I'm not making myself clear, so I'm just gonna move on to the next idea here.

Uh I'm curious how if there's a way to take the 20 wells that supply 52,000 residents and make them as efficient as the eight wells they're gonna supply 72,000 residents.

What could be done to make that efficiency happen?

Because I looked at your chart and said you had 20 servicing 52,000 people and eight would serve 72,000.

That's an excellent observation, and I suspect there's a problem with one of those data points, and I apologize for that.

I go ahead.

Yeah.

Mayor, Councilmember Torres, and I think part of the the math around that is that right now the total amount of water that those wells produce is not is not fully utilized because a lot of those wells are on the SRP system where we can also we also have the surface water.

We try to use that first.

So those wells actually do produce more water, but they don't produce it where we need it, um, which is the off project.

And so the the um 72,000 or so r customers that are residents that could be supplied by the eight wells is completely fully utilizing all of the water that those wells could produce.

But the others are they're just not fully utilized because they're not in a place where we actually need the water.

We have surface water we try to use first.

We don't want to use the groundwater.

So that's just like the proportion of of the customers that we currently serve with groundwater compared to when we add these eight wells on, it will be completely offsetting a surface water that we no longer have.

But will that come into play as water becomes more scarce?

It it all just depends on where the wells are.

A lot of those wells are on the SRP member lands, and so we use those if if surface water in the SRP system gets more scarce as well, then we would also be using the SRP wells more regularly.

Correct.

We can't use those SRP wells in this in the off-project non-member lands.

Thank you.

I'm good.

Thank you.

Thank you, Mayor.

Um I want to talk a little bit about the question about the water conservation.

You said that we have saved through residents having their their property checked, like five million gallons or something like that, correct?

I believe that's correct, yes.

Okay, I and I'm I'm one of those people.

I mean, I had a broken, not faulty, a broken meter if it was 22 years old, and I had 24 leaks that I didn't know about, and my bill went from twelve hundred dollars to 177 dollars just by fixing you know my leaks, and the town was responsible for getting me a new meter, and I was responsible for fixing my leaks.

So with those five thousand or five million gallons that we believe we've we've saved, do we know if those properties were more lower end users or high-end users?

Or do we track that?

I don't have that information in front of me.

I'm sure that it's tracked in some way or another, and I'd be happy to provide you with that.

So should we and and uh part of the problem with all the misinformation on social media that drives me nuts is that a lot we we probably have a lot of residents that do have legitimate leaks that are convinced we have broken meters.

What can we do to get those people just to call the town up and say, let's just check this out?

Because I could have easily said, oh, the my meter is completely faulty and laid the blame on the town, but I had 24 leaks uh on my end also.

Yes, uh mayor members of council, uh Vice Mayor Bongiovanni.

Um, one of the things that we've recently implemented as part of the metering system that we have is a continuous consumption notification.

So anybody that is shown to use more than 20 gallons per hour over a consecutive 36 hour period has been getting notified by the town.

Absolutely.

Um yes.

And so as part of that, um, you know, a a small leak like that can be easily 15,000 gallons or more over the course of a month.

So we do that.

I actually saw something on social media where somebody said, Oh, yeah, I was getting this letter from the town, but I just threw it away.

And then somebody else said, Oh, well, maybe you should reach out to them because it sounds like you have a problem.

And he says, Yeah, I think I will.

I think I have a leaky toilet.

So some of it, like we're doing our best to contact people when we know that we can see that they have a continuous consumption that could be the result of a leak.

Sometimes it's legitimate, sometimes maybe they were filling their pool, and so they did have water running for an extended period of time.

Um, but we do our best to reach out to them.

That is a new program, but so far I we've sent out I think 1,800 notifications since November.

So I knew we had the software, I just didn't know we were implementing that that yet.

So that's that's good to know.

And we can only do that for for those that actually have the new AMI system on them, which isn't everybody, but we're working on that implementation as well.

And I I would like the data to find out of the homes that we've gone to, if they're lower end users or higher end users, because I'd like to see us be able to focus, you know, on those higher end users over time.

So thank you.

I'd be looking forward to that information.

Councilmember Buckley.

All right.

So almost every question I had has been asked, and I am not gonna repeat them.

But I I do have just a couple of statements, and this one goes back to something council member Torges and I think might have been talking about the outdoor landscape water that we use is potable water.

Has there any way to like I said, I think he probably asked some of this.

Why have we not tried to find a way to make that not potable water to use reclaimed water?

Morrison Ranch has their own uh reclaimed, I mean they they processed their own water and they use reclaimed water for their grass.

Why can't we do that?

Sorry, Mayor Councilmember Buckley, are you referring to single-family residential customers utilizing reclaimed water for landscaping?

Yes, I mean like different areas, different communities that maybe could possibly help and do that, or can the town place go ahead.

Okay.

Mr.

Snow, my my favorite person.

Council member Buckley.

Thank you very much for that question.

The use of reclaimed water requires a specific reclaimed water agreement with the entity that's going to be using that water.

So that water cannot be resold once it's delivered.

So you mentioned specifically Morrison Ranch, for example.

Our reclaimed water system delivers water to the Morrison Lakes, those lakes then are pumped to deliver water through the various amenities and inside of that community.

It can't be resold and uh then submeter, so so to speak, um from that point on.

That's a part of the reclaimed water agreement that we have with those communities and is a and is a permitting requirement that we have in the use of that class A plus effluent here in the community.

Okay.

So but again, it is a permitting requirement because so we cannot resell it to like a single family residence, for example.

Um and then when in some cases, if um let's say a community does not desire to use reclaim water, then there's other there's other code requirements that they have in their uh in their development.

Right.

Uh and and I and I understand that I'm what I'm thinking is why can't the town do that?

Why can't we go in?

And I know that's a huge scope, but I think as a thought, and I think it should maybe be investigated a little bit.

And I'm sure you guys have probably already done that.

Yeah.

So what you can tell is that reclaimed water is owned by a lot of people in Gilbert, a lot of different groups.

We've got the operational side, we got the water resources side.

What Rebecca tried to to um to spell out is that reclaimed water is fully utilized.

The all the what the reclaimed water that we have in Gilbert is fully utilized today.

We cannot put new users on it because we don't have more for them to use.

Now, how we got that way is a matter of both infrastructure and timing and location.

So most of the reclaimed water use in Gilbert is is in the eastern and southern part of Gilbert.

Because the north and the western part was constructed earlier before we were really developing this reuse system because we have separate pipes for our reclaim water to deliver it out there in the community.

And so that as that system was built to the south and the east, those communities had it available to them, and then at that time they had to make a decision if they wanted to build the infrastructure necessary to store the water like Ken described, either in their lakes or an underground system, which they could then pump out later because our reclaim system is not nearly as robust as our potable water system.

So we can't always guarantee that it's going to be available at their time that they need it, so we deliver it to their lakes.

So those are the those are the two main areas now to convert from a system that utilizes the potable system where we pressurize it and they turn on their sprinklers at whatever time they want to a reclaim system means that they now have to put in some sort of a storage system.

And they're not small, that's what those lakes are for, depending on the size of their landscape.

So there's a significant upfront investment that those communities had to make in order to actually access the reclaim water.

Okay, so well that kind of answers that it's too little too late, right?

But so my thought from there is can we look forward and try new communities that might be coming in to at least look into that and consider that because it it drives me crazy that we're and and correct me if I'm wrong, but I thought I heard you say that the landscape water outside we cannot recapture.

That's correct.

So does that mean that where does it go?

I mean, doesn't it still go in the ground and that it adds to the groundwater once it filters down?

That's a very common, that's a very common conception.

Um but what actually happens to it, the vast majority of it is either used up directly by the plant that's being irrigated or it evaporates away.

So there's nothing left to go in the ground.

Yep.

Okay.

So I I still think that we are known as a forward-looking town, that somehow we should try and make it not evaporate.

No.

I I would like to see that.

Um but you explained that very well, and thank you.

I have another question, probably for I don't know, it might be for Kelly.

But the 77% that you guys have mentioned earlier.

Of the Colorado River potential reductions?

Yes, yes.

But can you can you refresh my memory here as to why that we have to do this 77%?

I mean and and I think I you know, I just I know and I'm trying to clarify these statements because we went quite fast, and I think for some of the residents, it it's difficult to you know catch all that stuff.

It's very complicated.

But 77% cut.

If what I guess my question is, what is going to happen to us and our water supply in Arizona with if no nothing is settled, we never get another agreement.

Are we losing all this water and we can't get it back?

Without sounding too doomsday, that is the reality that's facing us in six months in October when the 2026 guidelines expire.

And the current state of affairs on the Colorado River Basin is that the seven states are squabbling, and there is no agreement that they can come to at this point.

And the federal government has laid out the federal government is the water master.

They control the Colorado River water supplies.

And so if they make that determination that they want to enforce the the uh the no agreement option as was described, they can shut off the intake to the Central Arizona project at the Colorado River.

Completely shut us off.

Completely shut it off.

Well, it it's also my understanding too that Gilbert is one that we have done future planning and that we are very secure in our water supply.

Even if we do lose this, I I don't want our residents scared and afraid that we're gonna totally run out of water.

And I think it would it would behoove us to maybe explain a little bit to them how well we have planned and how long you know we can continue going if if they shut us off.

I'll take that as an invitation to explain.

Yes, we saw this coming many years ago, and still this is a very fast moving water issue.

Um these usually take decades to unroll.

This has unrolled over the last four or five years.

But what Gilbert has done in seeing this potential likelihood, although we gave it a less than one percent chance that we would be at this point.

We looked at it and said one percent is still significant enough that we accelerated our well drilling program.

Those eight wells that are coming online by the end of next year, those were those were planned out over the next 15 years, and we accelerated them into a three-year window, which is one of the extreme costs that this community has undertaken in order to be prepared.

The Northwater Treatment Plage is another one where we are going to maximize our use of existing resources in the central or the SRP system, as well as exchanges with other partners to be able to use water from that plant, push it into areas where we could not previously legally do in order to meet the needs of those areas that currently use Central Arizona Project Water.

We're also embarking on an interconnection with the town of Queen Creek, where they will recover some of our stored water underground and deliver it to us through their wells.

So we'll utilize some of their infrastructure as well at a cost benefit to Gilbert residents.

And even before any of that, beginning in 2008, Gilbert started storing water underground.

And we now have over half a million acre feet of water stored underground for us to use in this current situation.

That is more than 10 times our annual water use in Gilbert.

So we have we have looked at this over periods of a couple of decades, and we've accelerated plans that we had on the books when we saw that there was an acute issue that was although very slim, has now become very likely.

So it's been short term and it's been very long-term planning for the town.

All right.

You you you did that that well, and um thank you for that.

That's that's all I have.

I just you know felt like a a deeper explanation which you have done was was an order.

Okay, thank you.

Okay, thank you.

Councilmember Koprowski.

Councilmember Kaprowski My question relates to our utility assistance program, which was initiated with the original uh plan in 2023.

It's currently supporting um individuals in the town that have the greatest financial need, and it's $30 a month.

Do you need council action to increase that amount per month, or do you already have flexibility from previous action to adjust as necessary?

Mayor Councilmember Kropowski, I'm not sure I know the answer to that question.

I believe that the first um the the the beginning of that program was instituted through council action, and so we would absolutely take council direction to look into adjusting that amount to what council feels is appropriate.

Okay.

Thank you.

And count Councilmember Kaprowski, we um continue to look at that program and to um provide um the assistance that we can.

It I can we can get that information to you just as to how many people are using it and what that looks like.

Um the budget, I believe, for the upcoming fiscal year just based on the numbers that we have and the expected usage for that and how we are projecting that is nearing uh half a million.

So we are using quite a bit for um assistance to residents, and we'll continue to look at it.

But we'll send you the the stats on where we are and and how that has been increasing over time.

For example, with action tonight on the rates, would the town be able to adjust that per month amount, or do you need the motion to include direction on an adjustment?

So we certainly can look at it, and we do not need cat uh council action to make that change.

Uh what we will likely need is additional funding via contingency to ensure that the um that those uh discounts are covered.

But that could be brought to us at a later time.

It can.

Thank you.

Councilmember Torgeson.

Is there anything that we can do regarding HOAs?

Because we're off-cycle from much of their their budget planning.

You know, it hits them in the middle of their the year, they don't know what's coming.

They some of them prepared well, some haven't, but it still puts them in a lot of them in a very precarious position.

People are paying that secondary cost through their HOA fees.

And can we do something about removing some of the demands that we have on them because there's so many landscape demands you have to have X amount of trees, X amount of bushes, this whatever it is.

Is there something that we can do quickly in case some of these neighborhoods wish to react to that?

Some may decide no, uh we're not gonna change the thing, but I think some would like to change, and I'm gonna add in to that.

Is there a way to arrange for them to have a little more notice before we hit them because it's it's a real thing and it's in the middle of their budgeting.

Mayor, Councilmember Torges, and thank you for the question.

Um we have noticed this information out to HOAs.

They have been made aware that this is the third year of a three-year increase, and we would hope that they include that in their budget planning process.

However, I want to address the the second part of your question as far as resources available to HOAs.

Uh, we've recently expanded our uh non-residential turf removal project um which allows HOAs to uh supplement the funding of a project for up to 25,000 per project, I believe.

Um and remove that non-functional turf that we're looking to get out of the system for conservation reasons, get the project in part paid for by the town of Gilbert, and then as a result, they see lower water bills in the future because of the lack of turf.

Uh, we are looking to expand that program and similar programs with resources to HOAs in the future.

We got is that a wrap so we can get to the uh public.

I've got several requests to speak cards and um we're gonna be uh as you come up if you talk about all three items.

I think they were identified on the cards.

We will be voting on them separately, but feel free to talk about all three uh items.

Mayor, can we take a bio break real quick?

Sure.

All right, thank you.

Can you make it in five minutes?

Five minutes, yeah.

Everyone will take it upstairs and back.

Just get everybody back.

It's not like that.

I mean, like it was like significant major.

Yeah.

It would have to be a totally new body style.

Okay.

We will reconvene and we will start with the request to speak again, as I said, we'll take this as a block sixteen, seventeen, and eighteen, but we will be voting on them separately.

Our first speaker, three minutes, Daryl Grosson.

Good evening, Mayor and Council.

My name is Darrell Grosson, Gilbert Residents.

For months I have been dismissed by members of this body as a keyboard warrior, irresponsible, and spreader of misinformation.

You have told the public I don't have the facts.

Tonight I am setting the labels aside.

Growth pays for growth, water pays for water, and the general fund is strictly off limits for water costs.

You have gone so far as to claim that using the general fund to subsidize water costs would be illegal and would destroy our bond rating.

According to the town of Gilbert's own public records, this council has quietly approved the transfer of 70 million dollars from the general fund to subsidized water systems development fees.

Costs that are, by your own policy, the sole responsibility of developers.

The amounts are as follows.

And for the town to take accountability for the lack of transparency.

Next is Donna Mills.

My name is Donna Mills.

I have been in my home in Gilbert for 29 years.

On the topic of utility rate increases, while today's prices will always be higher than the day before.

We are living in a time when percentage increases are historically higher across every single sector.

Not because incomes dictate or indicate that they can bear inflation, but simply because corporations and entities are all pushing boundaries to get their piece of the pie off the backs of the citizenry.

Collectively, this is untenable and unaffordable for the average household.

To say that the town of Gilbert utility increases are necessary because prior town councils have not done their job in increasing rates at consistent levels is incorrect.

As a 29-year resident in my home, I have seen my monthly utility bill slowly increase over the past decades, from $45 a month when we moved in, then to 65, then to 85, then to 95, 105, 125, and now a base rate of 145 dollars per month.

Whether voted on or not, the rates have in fact been increasing.

To say otherwise is patently false.

And where exactly has that money gone?

The ledgers do not make it clear.

Water has flowed from my tap that is brown, rusty, and disgusting.

No courtesy of a work notice whatsoever, as is given in neighboring cities.

To say that in increases are necessary to ensure water availability in the state is laughable as citizens in all the surrounding cities, including Phoenix, are aghast at our utility rates.

Clearly, they are not sharing the burden.

And then there's the issue of count continuing to approve and build high-density multi-residential facility facilities, all while claiming that river water is about to run out.

And let's be clear, it's not just the incremental water increases that are strangling Gilbert residents.

It is the rising base rate, regardless of how little water is used.

I also have asked multiple times about the five-month duplication of billing costs in my bill to the penny without satisfactory answers.

No one could answer why five months in a row, my billing said the same thing to the penny, even though my water usage fluctuated.

It seems that regardless of how loud and hard residents push back concerning this, our pleas are falling on deaf ears.

So I'm here to tell you that families simply cannot afford another increase.

No to being able to afford another increase, therefore no to voting for one.

To items 16 through 18, Gilbert residents in the thousands ask you just to say no at this time.

Thank you.

Thank you.

Kent Norcross.

Mayor, Council, uh, Kent Norcross, a 37-year resident of town of Gilbert, graduate of the class 13 of Gilbert leadership.

And I too wanted to just real quickly express my thanks for your service and for the staff and for the efforts they've made to get information out.

I had the privilege of meeting with Mayor Anderson the other day to get some information.

My questions are around.

Uh plan, and there's 93 projects and almost two billion dollars.

So it's a it's a big problem that we have.

Some of that's already been spent.

Most of it will be spent in the next five years, some will be spent after that.

So I I analyze those projects in the funding sources for those projects.

In reviewing those projects, there were 14 projects that included the following language for funding.

This project is anticipated based on growth in the area, and therefore is eligible for system development fee funding.

Of those 14 projects, 10 were fully funded by SDF.

However, four projects included water funds, up to 50% of the project, even though it's stated that it was eligible for system development fee funding.

There were additional eight projects that included language at a portion of this project is anticipated based on growth in the area and therefore is eligible for SDF funding.

Of those eight projects, two projects did not include any SDF funding.

In addition, there were six projects that included language that said this project is support water system resiliency and growth.

Growth would indicate SDF funding.

However, five of those projects did not include any SDF funding.

So if you have three people in your home, that's 9,000 gallons a month, roughly.

That thousand gallons between eight and nine, you're paying 10% more than the the uh non-residential user would pay.

And then it goes up as you use more.

There's no incentive for commercial users to use less water, and in reality, they pay less for their water, whether it's 100,000 gallons, a million gallons, then we pay for our eight to nine thousand gallon water.

I guess I would like to just say that I would encourage the council to we're gonna need more money.

I would encourage you to use option A or B, E, sorry, E, raise it 14% this afternoon, and then ask the town staff, your boards, advisory boards, and I I volunteer my time as well to try to find ways to make sure that this is being paid for by the appropriate parties that we're not putting an undue burden on the residents of the town of Gilbert.

Thank you.

Thank you.

Laura Gazicki.

Is Laura here?

Perry Castinus?

Castanus?

Castinus.

Mayor, Vice Mayor, and Town Council.

My name is Perry Costanis.

I own a couple properties here in Gilbert as well as others in surrounding neighborhoods.

I came to the open house offered and found it very informative.

My message to the folks I spoke with was that Gilbert should be a best in class community.

We shouldn't be, as was adequately shown today, paired amongst the highest rate payers when it comes to water.

After option A or E is in effect, the affordability index moves far to the right.

With Chandler, with Mesa, with Tempe, the ones that clearly showed that they are doing something that we obviously cannot.

We need to find a better source to maintain affordability in this community.

Adding 50% one year, 25% another, and 25% another is not a solution.

I applaud the effort, but I find it a bit audacious to put your hand up and ask for an increase for these utility customers when we're not sure what we're charging them for if the meters are actually correct.

I did a very informal poll.

I don't know anyone in my small circle of friends that has seen a hang tag or anything.

It's been just 10 days since this has started.

I think it's unusual that we would ask for a rate increase without understanding the impacts of this.

We have a public relations problem here with the town that we have to spend so much money discussing why the rates for utilities are so high when we should be figuring out what we need to do to conserve.

Conservation really is the key here.

And I believe it covers both residential and commercial, and we're not doing enough to make sure that works.

Thank you for your time.

Thank you.

And I have a comment from Mark Thompson, who did not want to speak, but his statement was first a sales tax increase and now a third year in a row for water.

No for option A, no for option E.

I'll enter that into the record.

That's all the comments.

Could I council member?

Could we have staff explain the 70 million dollars moving in and out of an SDF fund so that we can clear this up?

Absolutely.

Mayor and Council, I'd be happy to address that.

Um thank you for a moment.

The system development fees are highly regulated under state statute, and the town works to charge the maximum amount allowed that we are.

Um but there are holes in the bucket, and we have talked about that in public and open meetings in the past in financial retreats and uh other opportunities.

One of the holes in the buckets with the state statutes is that um developments are allowed to be grandfathered into the lower fees for up to 24 months.

So the only way to fix the hole in the bucket is to bring money in from another source.

And there are holes in the bucket in the water system development fund that we have talked about.

When we addressed with this with council several years ago, we gave to a couple of options.

It could be general fund um putting some money in to help close that gap or water fund.

The direction from council at the time was to use the general fund money, so there has been transfers from the general fund that are open in public.

They are in the budget book and adopted by council.

Um the other option would have been to use the water fund.

Water rates would have had to be higher if the council had chosen that option at that time.

Um we do our very best to make sure that growth pays for growth in all that is allowed under state statute.

Um there continue to be pressures from the legislature to decrease the amount that we are allowed to charge for system development fees.

There are several bills running right now that would put a cap on what we're able to charge or would put a cap on how often we are able to update those fees to represent the true cost of development.

So we do our very best, but there has been use of general fund money to close some of the gaps that are in state statute for those growth-related fees.

And does that do anything to our bond rating?

Uh the system development fees are not part of our enterprise funds.

They are in a separate location, so no, that does not.

Although, if we were to have to subsidize it forever into the future, um, that might have some kind of an impact.

We're doing one-time transfers at this point in time to close that gap and finish that.

Thank you.

Yep.

Kelly, would you just just one more time explain the difference between enterprise funds and system development fees?

Sure.

Uh Enterprise funds are self-containing business units that have separate accounting in the town.

So our water fund is a separate self-contained business unit, our wastewater fund self-contained separate business unit or enterprise fund.

System development fees are fees that we collect on a one-time basis for growth to help pay for growth.

They are highly regulated under state statute.

They were required by state statute to be in a separate interest-bearing fund, separate from an enterprise fund, separate from the general fund, and they are used for the specific purposes that are in the system development fee.

Excuse me, the system development fee study.

Um it's about a year-long eight to twelve month process of noticing and going through the process of adopting a system development fee study.

It is a very public process with lots of input.

And we don't commingle those funds.

We do not.

Thank you.

Other questions, comments.

Councilmember Kaprowski.

I wanted to ask um council if we would be open to giving direction to staff to increase utility assistance in future years, and also to look at adjusting the timing of our rate adjustments to the fall months and future years.

Council?

And no, it's just consensus on direction.

Exploratory questions.

Yes.

I'm I'm good with that.

Yeah, I totally am.

In terms of right now, we can't because then we're gonna end up being short on the budget, but I I do think it's wise to do that after the summer in future years as needed.

Any opposition?

So that's some staff direction that we'd like to pass on.

Yeah.

Thank you.

You have that hands nodding.

Okay.

Any other discussion.

Discussion, comment.

Yeah, I like I'd like to go ahead.

Um so I know that this issue is is personal, and when you open your water bill and see it increase, it doesn't feel like infrastructure policy.

It feels more like another expense in the world that seems to go up every single uh every year with all the other expenses.

Um so the town councils will be voting on two possible paths forward.

At first glance, 14% feels easier.

It softens the impact each year, and I completely understand why that matters to families trying to plan uh their budgets.

But it's also important to understand the math.

Two 14% increases compound over two years, that's nearly 30% increase, actually more than the 25% uh option.

So the direction before us isn't simple big versus small, it's about timing.

It's about whether we address the funding gap more to uh more defensive now or spread it over two years, um, ultimately costing residents more in total while extending the uncertainty.

What I can promise you is this is our focus in in balancing three things protecting residents from unnecessary financial strain and ensuring long-term water um reliability in a desert community and maintaining fiscal responsibility so we don't create bigger problems down the road.

I did a small poll poll online and got a lot of responses that the community is is hoping that we go with the twelve uh 14 percent um rather than 25 percent.

But these are not popular decisions, but they're important ones.

However, I can guarantee you that we can't bathe in popularity, we can't cook in popularity, and I can't drink popularity.

And unpopular decisions keep communities strong, vibrant, and healthy.

Making popular decisions and doing nothing makes communities weak, vulnerable, and unsustainable.

And I know this has been a long process, and I want to thank every resident who has been actively involved and engaged in this conversation.

Thank you.

Thank you, Councilmember Buckley.

Thank you, Vice Mayor.

I uh agree with everything you said.

I've talked to residents who um they're all over the place.

So you know some want 15, some want 14 and 14, some are adamant and say no, no is not an option.

We we cannot, it's not an option.

Compassionately for those that said, you know, please the 14, because it's a softer blow now.

Compassionally, I you know, I want I empathize and I want to be compassionate, and um I want to be able to do that, but it does provide less overall funds later.

And you're absolutely right, it's 29.9996 percent.

And let's not forget this was a plan.

This was a plan from a prior council who recognized the issue, recognized the perfect storm of all the things we've talked about.

I'm not gonna rehash.

Um but there was a plan to fix it, right?

500 million dollar bond in 2022, and then a three-phase approach.

The problem is you know, we're all busy.

Our lives are busy, you know.

This country, it's hustle bustle, and we get outnesia and we forget.

And um in 2024, that was part of the plan.

And people were infuriated.

And then in 2025, it was part of the plan.

And people were infuriated, and again, here we are in 2026.

What I'm you know, what I'm not interested in is prolonging the pain by prolonging the process because our residents deserve better than that.

And um we need to make the very difficult decisions that are before us, as hard as they are, uh, and then um allow our community to heal and move forward.

And I do think by learning from history to add another year by softening that blow, all out of compassion.

The last council did it out of compassion, not a criticism on that.

And the forgetfulness is not a criticism on our community.

And I forgot.

Councilmember Lyons.

There's two questions that I don't feel that are answered that have the potential to cause us a great deal of grief in a very short period of time.

One of those is related to the current meter audits we've go we've got going on.

We don't know what the outcome of that's going to be, and there could be some surprises with that that either have us fall short in revenue or we've gathered too much.

Second issue is this thing that came up tonight with the changes in the Colorado River.

And I remember Kyle correctly or Eric, I mean, he made the comment that we should know something about that in about six months.

If that goes bad, then we're going to be having this conversation in a far more contentious position six months to eight months from now.

And I think with those two unknowns, it would behoove us to take a very cautious step forward.

Do the 14%, get the answers to those two question areas that I brought up, and then take a look at where we're at at that time frame.

So I would just like to throw that out there for you guys to think about.

Councilmember Buckley.

Well, I was going to ask something else, but I'd like to maybe address what Councilmember Lyons said, because we're here to make a two-year, really a two-year decision.

And can we can we come back in six months or a year and change that decision?

That I don't know that that's something we want to do or don't want to do.

But that just brought up, you know, just more questions and more things to look at.

What I what I am looking at is the 25% rate, and I don't recall who said who said this, but it's like let's not prolong the pain.

And but if we do the 25% one-year rate for 26 in 27, our projections, and I hope I'm uh appropriate to say this, there would be no increase in 27.

And then 28, we will level off and no, and no one had really said that.

And is there a reason why no one has said that?

So am I appropriate and in the lease said it?

Did you okay?

Well, I didn't realize that.

But that to me, the thought of no increase in 2027 is like that is fantastic.

And then they were the hope is and is that we start leveling off at a more affordable and reasonable rate, and of somewhere around 5% a year after that.

But I'm leaning toward doing the 25% and then no increase and 27.

And the math is if we go the 14 and the 14, that added up.

It's certainly not 25, it's 28 percent compounded.

And that to me it that just doesn't make good sense or a good decision to do that.

And you know, I've we've all lived and breathed this rate increase for probably the last year.

And we've done retreat after retreat, and we've gone through presentations every everywhere, and I don't think there's a stone that's been unturned that we haven't tried to analyze and look at and try and make the very best decision.

But that's where I'm at right now.

And it's it's not an easy decision.

None of us want to do this, but you elected all of us to, you know, our jobs, our main jobs are to balance the budget.

We have a balanced budget, and we will continue to balance our budget.

The other big thing that is our duty is to keep our infrastructure strong.

And that includes water, sewer, streets, you know, the uh anything connected to keeping the town without potholes in the street and making sure we have good water and making sure we have enough water.

And um, and we're all doing everything that we know how to do and to make it try and keep it affordable.

So that's it for me.

Councilmember Torres.

I wanted to point out that what people are missing in this rate is in 2021 it was approved.

I think the last things were issued in 2022, April of 2020.

A $500 million bond, it's a loan.

It's a loan, it's not free money.

And a council before I was here approved that because they saw the necessity of a northwest western north water treatment plant.

That has to be paid.

If you don't pay that loan, your town goes into receivership, basically.

They decide what gets paid and who gets paid.

I'm pretty sure they put themselves first.

That's can't be unrung.

That bell can't be unrung.

There's no way to unring that bell.

Uh we've we grew from 95 to 2010 as the fastest growing community in the country.

The council made decisions based on that.

Whether they were right or wrong doesn't matter.

Yes, everyone sits sits in a chair here and gets to bear the brunt of their good decisions, their bad decisions, or decisions that nobody knew what the outcome would be.

But we sit here and in this day and age we look and we have failing infrastructure, not because somebody purposely contracted the mingus construction to bring the the initial plant.

It wasn't nobody made the decision to build something poorly.

It was just built poorly, and we have to replace it early.

There are pipes, uh ductile iron pipes that are failing early.

We are not the only municipality in the country facing this.

Uh those things have to be paid for one way or another.

This isn't a free-for-all for money.

Uh the amount of people that think that somehow people on this this diocese pocketing cash is just it's just disappointing that we don't have a more articulate community in that respect because it gets personal and it gets odd.

Uh two years ago I voted uh no because I felt that we didn't do enough outreach in advance, and I felt that uh we'd be reliving this like groundhog day.

Here we are two years later.

We're reliving this as groundhog day.

It's happening again.

Now we've done a decent amount of outreach, and I think that this town is now focused on trying to reach its residents in a much more efficient manner and take care of that.

But people that are unwilling to recognize we live in a desert, and if we don't fix things, we're really gonna live in a desert.

We get water, we get water from the Colorado River, we get water water from up north.

It gets brought to us.

That's not cheap.

And especially if we get cut off of 77.4 percent of uh water from the CAP.

We're in real trouble.

We've moved forward, move forward uh wells years ahead of schedule.

And I want to thank Lauren Hendricks again for getting 30 or 32 million dollars of state grant money to do that.

Uh it's 114 million dollar project, as I recall.

We have to pay for it.

Chandler's not going to come over and pay for it.

And when Chandler gets into its same situation because of later builds, they'll be in trouble too, and they'll face the same things.

They did a 15 percent increase, and they're not building what we're building.

We're building something that you basically own.

You're the residents, you own the water.

That's why there's no money made on it.

That's why it's an enterprise fund.

Certainly there's things that could be done better.

There's always one way to find something a little bit better.

And I'm certain that this council and this staff is gonna look for it because there's a lot of pressure to find it.

But no matter who votes for what tonight, we have to pay for things in the end.

The good residents of Chandler simply aren't going to pick up the bill for our water treatment plant.

And when the water does get dry up a little bit, I would rather be using our well water, which has apparently 10 years, you know, we have 10 years of water in the in the aquifer.

I'd rather be doing that than rationing water.

We pay we are paying money to be smart about this.

Some of you maybe don't appreciate that, and I get it, but I think that we all need to accept the fact that life's not fair.

Decisions were made with all the best intents by everybody for 25 years.

I don't think anybody intended this.

Nobody was per would purposely do that.

But we have decisions to make, whether it's 14 or 25, uh, to do it quickly and rip the band-aid off or experience this against in two years where people are going to come up calling us corrupt because they don't want to pay an extra $12 on their bill.

I get it, I understand.

But we have to do better at informing the people, giving them the opportunity to learn and show a little bit of grace to everybody that's making extremely painful decisions.

And that's that's why we're here.

We're making extremely painful decisions.

Not everybody's gonna like it, and I I just wish we would recognize we're buying our future.

We're paying for it.

We're not gonna be sitting here in five years with a broken down Northwest Street water treatment plant uh delivering really brown water, undrinkable things, as in some municipalities have had across the country.

We're being proactive, and I don't think it's worth arguing over 15 or 20 dollars a month to ensure that you've got water.

Councilmember Kaprowski.

I wanted to address some of the comments from Councilmember Lyons.

Um it's my understanding that both option A and option E are have been proactive looking and preparing for the near-term Colorado River shortages that are now a higher likelihood reality.

Um so I don't think there is anything else that would be done in six months, even if that news came to us.

I also believe that the water rate studies take about a year to conduct, and that's why it's done every two years.

So it'll be brought back to council in the fall of 2027 for the 28 and 29 rates.

So I think everything that we've done so far with what was talked about with the wells with the water treatment plant, that is all our short-term plan.

So I don't think that um any of the information that'll come later this year with those Colorado River shortages would would would change our decision tonight.

Um and if staff doesn't agree with that, please speak up.

Um and then just a like a comment after hearing everyone else.

I also support following the original 2023 plan and the recommendation from the public works advisory board for option A.

Thank you.

And I'm glad that you mentioned that about what Eric said.

I want to underscore again what something he said uh about what's happening on the Colorado River, which I don't know if all the communities in this valley are have grasped yet, the severity of it.

It's not something where it might be difficult to deal with.

This is something that's going to be somewhere between really, really bad and a disaster.

And we need to plan for that now.

Uh we need to plan so that our water portfolio is resilient.

And the only way that portfolio is going to be resilient is if we invest what it takes to keep it resilient so that we have the water that's necessary to maintain our quality of life.

And so I'm I hope that that message sunk in tonight because it's a serious matter that this entire valley needs to consider at this point.

I'll entertain a motion on item 16.

I'll move to approve item 16 adoption of resolution number 4637 with option A, the 25% increase in 2026.

Second.

It's been moved and seconded that we adopt resolution 4637 increasing fees for water water rates.

Uh according to the option A.

Please vote.

Motion carries 43.

Item 17.

I'll entertain a motion.

I'll move to approve item 17, adoption of resolution number 4638, increasing fees for residential solid waste and recycling.

I'll second that.

Please vote.

Motion carries 61.

Councilmember Lyons dissenting.

Item 18.

I'll move that we uh accept uh item 18 considered adoption of resolution number 4639, increasing fees for commercial solid waste and recycling rates as written.

I'll second that.

It's been moved and seconded that we adopt resolution 4639 increasing fees for commercial solid waste and recycling.

Please vote.

I did vote.

Yeah.

Motion carries six one with council member lines dissenting.

Thank you.

I know this has been difficult.

It's something that we didn't aspire and want to do, but it's something we had to do.

I hope we uh see it that way.

Thank you.

Administrative items, item number 19.

Council administration consider acceptance of the budget report and contingency report for the second quarter of fiscal year 2026.

I have a motion to approve.

There's a second.

I'll second that.

It's been moved and seconded to approve item number 19.

Acceptance of the budget report and contingency report for second quarter of fiscal year 2026.

Please vote.

Motion carries 70.

Thank you.

Future meetings, you can see what's on the agenda there.

Communications report from the town manager.

Thank you, Mayor.

I have no um reports today.

Report from the council.

Councilmember Lyons.

Um the slides up for the uh veterans advisory board.

Mayor, I'll I'll read them this time.

Okay.

Okay.

All right.

Um, you know, our first slide here has to do with uh the military tribute banners.

Um you know, we need folks to purchase them by March uh 31st of this year, and the banners are hung in the Heritage District for Memorial Day Independence and Veterans Day.

Uh it becomes a memorial keepsake uh after the display date.

So if you have a hero, someone who has served, uh I would encourage you to uh look at that option.

And then coming soon, we're going to uh rehang, do a rehang program.

We're working on that for those who have already purchased the a banner and would like it uh redisplayed.

Uh we're working on that program.

And then also to um on the uh next slide.

One more.

All right, very good.

We got the uh state 48 veteran and veteran support t-shirts that are now on side uh you can get them at the Gilbert Town store, and I encourage you to purchase it.

The proceeds of that go to help us uh uh meet the needs of the veterans in our community.

And by the way, tonight uh they were playing a uh softball game over at Cactus Yards uh as a way to get together and network and stuff.

So appreciate the community for supporting that.

Thank you.

Thank you.

Councilmember Bucklin.

Thank you, Mayor.

Just a real quick report that just came up tonight.

Um Rebecca and Asaias, you guys put a ton of work into those presentations.

They were absolutely um so professional, so informative, and um I believe in praising in public, and I just want you to know residents that were and more than one that were watching this presentation, um, were texting me saying how um impressive it was, how professional it was and informative it was.

So thank you guys for that really hard work.

I know it's nobody wants to raise rates of residents.

I know you don't, I don't.

Um we have tough jobs, so thank you for um the the incredible quality work you put in and the the residents thank you.

Vice Mayor.

Thank you, Mayor.

First I want to start off by um thanking everyone for the good thoughts and messages uh over the past ten days when I was hospitalized.

It meant a lot to me to read those and to not be hated on social media for a little bit over a week.

Um I'm just kidding.

Um I wasn't hated.

It really did mean a lot to me to read your messages and text messages, emails, and some of you who actually visited.

I appreciated that quite a bit.

So now that um you know council member uh Lyons up to the game.

Now I have to have um I have to have slides also because he can't undo me.

So we're talking about Parks and WEC and we have a family fishing clinic at the repairing preserve.

Join us for hands-on learning on the ins and outs of fishing at the repairing preserve.

This clinic will provide fun fund uh fun some foundational skills needed for a day of fishing from assembling the fishing pool to reeling the best in the best catch of the day.

That'll be on February 20th at the Riparian Park from 4 to 6 p.m.

And then we have the Gilbert Outdoor Expo.

Uh put on your camouflage and boots and head over to Gilbert Outdoor Expo at uh repairing preserve.

Uh you'll have a chance to brush up on various outdoor activities and learn some new skills.

Go fishing, explore wildlife, climb on a rock wall, and much more.

This free event is something for the whole family can enjoy, and that's the day after.

That's on February 21st at the repairing park from 9 a.m.

to 2 p.m.

So please reach out if you have any questions.

Thank you.

Thank you.

Anything else?

Councilmember Buckley.

Um, I I just wanted to say that I when I vote and when I look and items that I look at, I am looking at the future of Gilbert, at the future of what you guys are gonna be living in.

And to you know a no vote on this water rate that we have.

If we had a no vote, which no one has talked about, the water treatment plant, the the funds from this vote go to the water treatment plant to complete the water treatment plant.

We would not have enough funds, and everyone on here knows this.

We would not have enough funds to continue to complete the water treatment plant without a yes vote on this.

And I'm not looking as if I'm gonna get re-elected if I vote for this.

I'm not looking at anything else.

I am looking at the future of this town with the vote that I had.

And I I'm just I don't know.

I I'm speechless that I feel like I have to explain this vote in order to keep our water infrastructure strong.

But anyway, that is my statement for tonight.

And I stand with how I voted and protecting the future of the water in Gilbert.

Thank you.

I don't think I have any slides tonight, do I?

No.

I don't.

So that's it.

So I'll take a motion to adjourn.

So moved.

Then move to readjourn.

We are adjourned.

I was wet.