Mesa City Council Study Session – April 2, 2026

The Mesa City Council held a study session on April 2, 2026, to review the April 6 council meeting agenda and receive detailed presentations on the fiscal year 2026-27 proposed budget, the 2026 financing plan, and the parks and recreation department budget. Discussions included bond refinancing, property auctions, utility capacity fees, and departmental reductions.

Discussion Items

• World Autism Awareness Day: The mayor noted Mesa is the first autism-certified city, with council members wearing blue in recognition.
• Agenda Review – Item 5E (Banner Gateway Improvements): Councilmember Duff questioned whether the city was funding private development infrastructure. City Engineer Mark Halls explained it was a small gas line improvement paired with the Central Mesa Reuse Pipeline, serving a public purpose. The utility will repay the bond proceeds from future revenue. Council clarified the flow of funds: the city pays upfront, then reimburses itself with bond proceeds, expecting to profit over time.
• Agenda Review – Item 5F (Reverse Auction for Power): Councilmember Taylor asked for clarity on the $1.3 million reverse auction for additional power. Staff explained it addresses nighttime demand in the electric service area (5.5 square miles) due to rising nighttime temperatures. The $90/megawatt hour limit is the cheapest current contract for summertime off-peak power, with confidence that market prices will be lower. The auction process has worked well previously.
• Agenda Review – Item 5B (Auction of 8130 East Redberry): Real Estate Manager Lisa Davis presented results: 10 acres sold for $2,090,001 (minimum bid $1,550,000), with 56 bids over 31 minutes. The property was purchased in 2003 for $630,000 with voter-approved bonds. Three bidders participated; the winning bidder was Blandford Homes. Proceeds will be reinvested in parks in northeast Mesa, consistent with the original bond category. The sale was approved for city manager to sign purchase and development agreements.
• Agenda Review – Item 5D (2026 Financing Plan): City Treasurer Mark Hughes presented the plan: (1) refinancing $225 million in utility bonds from 2013-2016, saving $13.6 million (net present value savings 4.2%) without extending maturities; (2) issuing $61 million in general obligation bonds for parks, public safety, and transportation (using authorizations from 2020, 2022, 2024 elections); (3) issuing $341 million in utility system revenue obligations for capacity fee projects (47.5% paid by capacity fees) and non-capacity fee projects (including smart metering, signal view water treatment plant expansion, and gas system improvements). Council discussed the philosophy of bonding smaller amounts more frequently vs. large packages, and the importance of matching project costs to users over time.
• Agenda Review – Item 5A (Mesa Town Center Improvement District): Staff explained that the downtown property owners self-assessed to form DMA (a 501(c)(6) nonprofit) in 1985. The city assesses and collects fees as a pass-through. DMA uses funds for clean and safe programs, marketing, and events. The city is the largest landowner in downtown but voluntarily pays a lower per-square-foot assessment to be a team player.
• Agenda Review – Item 6A (Riverview Development): Staff discussed a 3.1-acre parcel (former county animal shelter) near the Cubs stadium. A developer plans multifamily housing for Cubs minor league players (year-round) and a hotel for the public and team overflow. Councilmember Taylor expressed concern about lack of retail/dining; staff noted challenges with parking and access, but said this is the best use received for the site. The city will issue a new RFP for the larger Riverview area for mixed-use development.
• Fiscal Year 2026-27 Proposed Budget (Item 2A): Budget Director Brian presented an overview. The proposed budget is balanced, with a goal of structural balance by FY 2029-30 – now two years ahead of schedule. Ongoing reductions over three fiscal years total $55.7 million. General fund net sources and uses for FY 2025-26 projected to be negative $29 million (improved from earlier forecast due to higher permit revenue and Prop 400 transit funds). The city maintains reserves above 18%. Key pressures include state legislation losses, compensation, fleet, software, building maintenance, and ending ARPA initiatives. Departments submitted 2% reduction plans; 4.8 of 6.6 million in enhancement requests were approved, including the redevelopment toolkit pilot, new positions (assistant city prosecutor, senior internal auditor, HVAC tech, process server for code, IT tech for Wi-Fi), and $6 million for facility maintenance and $3 million for parks maintenance.
• Utility Fund Budget: The utility fund forecast improved significantly with adoption of capacity fees (estimated $24 million annually). A third shift for fleet services at East Mesa Service Center was added to maintain solid waste trucks. A $250,000 allocation for the Bartlett Dam feasibility study was included (Mesa’s portion). Council expressed concern about potential water rate increases from CAP and the need to maintain reserves to avoid spikes.
• Parks, Recreation and Community Facilities Budget (Item 2B): Interim Director Andrea Alakot presented the department’s public purpose statement and cost recovery model (five service levels). The department’s total budget is $55.1 million in expenditures with $17.9 million in revenues. Proposed reductions of $942,000 (2%) include: eliminating three vacant full-time positions (recreation specialist, programmer, trades worker); reducing part-time non-benefited hours (7.24 FTE equivalent, less than 5% of total); closing Fremont Aquatic Complex (no summer programming after May 23, 2026, with redirecting users to nearby pools); eliminating spring Celebrate Mesa event (saving $36,000 plus indirect staffing). The department kept all current full-time staff and maintained baseline park maintenance.

Key Outcomes

• Council acknowledged receipt of minutes for prior meetings (motion passed).
• Council provided direction to staff on the proposed budget and financing plan, with further detailed presentations scheduled for April (departments) and a tentative budget update on April 30.
• Staff will bring forward the five-year renewal of the DMA organization in October 2026.
• No formal votes were taken on the budget or agenda items; these will proceed to the April 6 council meeting for action.