Okay, everyone, welcome to our Mesa City Council study session for February 9th, 2026.

Uh, Vice Mayor Summers is participating by Zoom.

Uh Councilmember Heredia may participate, he's not feeling very well, but otherwise all council members are present.

Item one is to review the agenda for tonight's council.

I know we went over the agenda previously, but council, are there any other questions for staff?

I know we talked about 4A, the purpose of uh 12-inch high pressure gas line out in the uh new magma area.

Mr.

Hassart gave us some intel.

Let's see here.

Okay.

Okay, I I have some questions about 4A based on some information that was pinged on me from some of the residents.

Okay.

Oh hi.

How are you doing, Mark?

Great.

And we apologize.

Mr.

Boucher is home sick today, so uh Mr.

Hirschberg is pinch hitting for him, but has some information, I think, based on some questions that you all had received.

So that's very helpful.

Thank you.

So it's my understanding that it's our utility line, but it's servicing Pennell County.

Is that right?

Mayor, Councilmember Taylor, that is correct.

That's part of the it's Pennell County, but it's part of the Mesa Area gas service territory that we have.

Just for the sake of answering some questions, why do we service another county's residence and they aren't using their own utilities, et cetera.

Council member, this was a decision that was uh the um made back in the 70s.

Uh the magma service areas purchased in 1979 for the opportunity, knowing that there would be the potential for growth and potentially another revenue source uh for the utilities at that point.

And that's as it's continuing to grow and and grow out out in that area, that's exactly what's proving true.

And and these as Mr.

Boucher mentioned last week, um, the magma service areas and it pays for itself uh through those services.

And we use revenue bonds for this build out, is that right?

We use utility obligation bonds when we do these services.

Okay, like a two-fold question.

One, I know District 6, which is part of Mesa, but goes pretty far south, they're all on Southwest Gas, right?

There are portions of MACE of Southeast Mesa that are on Southwest Gas.

It's how the service territories were established and defined by the um uh corporation commission.

Okay, and that was also back in the 70s.

Right, as the utilities come online and their services territories are established.

Okay.

This new gas line that we have slated to build out five million five hundred ninety-eight thousand.

Um maybe I missed it.

Sorry if I did.

How are we planning on paying for it?

How long will it take for it to pay itself back?

Yeah.

Thank you, Mayor, Councilmember.

These are um again would be ob utility system revenue obligation bonds that we would use to purchase it.

Um the planning they come back relatively quick.

Part of why we're going to a larger pipeline is there is some vacant space down uh vacant land in that area that is slated for um industrial growth.

Um if it if when an industrial customer comes on within one year of servicing that customer, it could pay for itself.

Uh, we're seeing that with an existing um customer that's industrial customer that's uh we're turning on gas later this month or within the next week or two.

Um we have uh for 2627.

We are estimating 1.5 million dollars in revenue for that.

Uh and next year up to three point just over 3.5 million.

Okay.

And continuing to grow as their load increases.

So we have one industrial customer already, is what I'm hearing, and we're slated out for more that we know are absolutely coming on to that territory.

We have multiple uh industrial customers throughout the service area and in the city, but those would continue to grow.

We anticipate that land being it's out being marketed uh both by the state and Penell County and Queen Creek for future growth.