Mesa City Council Study Session: Budget Review and Agenda Discussion – April 30, 2026
Mesa City Council Study Session: Budget Review and Agenda Discussion – April 30, 2026
On April 30, 2026, the Mesa City Council held a study session to review the agenda for the upcoming May 4 council meeting and receive a presentation on the proposed FY 2026-27 budget. Councilmembers Taylor and Duff participated via Zoom; all other members were present. The council discussed several consent agenda items, heard a detailed budget update, and made decisions including a 30-day continuance for one development project.
Agenda Review Discussion
- 5B – HOME ARP Funds Reallocation: Staff presented a request to reclassify federal HOME-ARP dollars from bridge housing (non-congregate) to support services. Candace explained that no funds have been drawn yet; the change requires HUD approval (approx. 60 days). The funds will be available for programs determined later. Councilmember Taylor asked about administrative costs and staff clarified that the $840,000 represents allowable HUD percentages for multi-year oversight.
- 7A – Economic Development Project (Continuance): Councilmember GoForth requested the item be removed from the consent calendar and continued for 30 days due to concerns from the economic development director and residents about project quality. Council unanimously agreed to a 30-day continuance with a date certain.
- 3A – Liquor License for 309 Sports Lounge (Series 12): Director Ed Queedon presented the application for a restaurant liquor license at Guadalupe and Dobson. The location had seven protests from five addresses. Staff reviewed calls for service at the strip mall (32 calls in 2023 for the entire mall, few for the specific suite). The applicant plans hours from 7 a.m. to 2 a.m. No technical objections but protests will trigger a state hearing. Council discussed prior ownership and neighborhood impact.
- 8C/8B/9A – Rezoning and Annexation Items (Hawes Crossing Area): Councilmember Duff raised concerns about converting commercial/mixed-use land to residential in multiple cases, potentially reducing retail and sales tax revenue. Vice Mayor and planning staff explained that the parcels are infill adjacent to existing homes and near retail hubs. They noted ongoing comprehensive planning for the area. Council requested a map showing how these parcels integrate with the Hawes Crossing PAD.
- 4D – Generator Purchases for TRWC Network: Councilmember Taylor asked about the Topaz fund and the 65.72% cost share listed. Staff explained that the TRWC is a joint public safety radio network; Mesa is the lead agency. The generators are for emergency use, and other agencies reimburse Mesa. The purchase is authorized but not final.
Budget Presentation (Proposed FY 2026-27)
- General Governmental Fund: Brian Richel (OMB Director) presented the final budget update. Net sources and uses for FY 2026-27 are negative $39.8 million, but $18 million of that is one-time expenses (e.g., PD radios, financial system upgrade). The ending reserve balance is 15.5% (above policy). Over three years, $56 million in ongoing cuts have been achieved through 2% departmental reductions. Sales tax revenues have been flat but resilient after state revenue losses. The public safety sworn MOU added $8.4 million to the deficit in outer years.
- Utility Fund: The utility fund forecast shows improved net sources and uses after removing capacity fee projects. Reserve balances remain healthy. Rate adjustments presented in December 2025 remain unchanged.
- Five-Year Capital Improvement Program (CIP): The CIP includes $446 million in carryover from FY 2025-26 (mostly multi-year projects). Major projects: PDHQ, fire stations, Ellsworth widening, Val Vista street improvements. Utilities account for over 50% of CIP funding. Operations and maintenance costs for new facilities are included. Contingency fund is maintained at $70-80 million for unanticipated needs.
- Council Discussion: Councilmembers debated the balance between cutting services vs. using reserves. Some advocated for surgical cuts rather than across-the-board reductions. City Manager Scott Butler noted the importance of maintaining public safety competitive pay and stressed that the budget is an expenditure authorization, not a household budget.
Key Outcomes
- Continuance Approved: Item 7A continued for 30 days (date certain).
- Appointments Approved: Mr. Welker to the Historic Preservation Board and Miss Lineman to the Design Review Board (unanimous voice vote).
- Board and Committee Minutes Received: Minutes from the Economic Development Advisory Board, Audit and Finance, and Design Review Board were accepted.
- Budget Next Steps: The tentative budget will be presented for approval on May 18, 2026, followed by public hearings and final adoption on June 1, 2026.
No public comments were received during the study session.
Meeting Transcript
Welcome to the Mesa City Council study session for April 30th. I guess that's the last day of this month, isn't it? Darn. Wow, went fast. 2026. Councilmember Taylor and Councilmember Duff are participating by Zoom. Otherwise, all other council members are present. I know Miss Duff, can you hear us okay? If not, I'll get a thumbs up or something from her. Ms. Taylor. Okay, as usual, we'll hear from them. Item was to review the agenda we have for Monday's May 4th council meeting. Let's go through the agenda. Council, are there any questions? I'm sure there's some thoughts and questions. This is Mr. Adams. Got your homework in. 5B. 5B. Candace comes right up. Good morning, Mayor and Council. 5B are the home ARP dollars. These are the dollars that we have mentioned in previous presentations that we received from the federal government. We haven't been able to make that happen or have that go forward. So we do need to do an administrative act of uh filing with HUD to change the category from this bridge housing or non-congregate housing to support services. There we go. So in simple terms, non-congregate housing means um individual rooms. Correct. Mayor and Councilmember Adams, this was the intent for this was bridge housing, which would be individual units or rooms versus congregate, which is a congregate shelter is a large room with individual cots. Understood. Okay. A fancy way of saying uh yeah, I get it. Um what what will be the specific effect of this amendment? Uh Mayor and Councilmember Adams, there's no immediate effect of this. This is a program that we were trying to work similar to normal home dollars. The anticipation was that we would use this as gap financing for a nonprofit to come in, create bridge housing. This would be their gap financing for the capital portion, and hopefully they would run a bridge program. So we're gonna ask that the the amendment will ask us, we will be asking to uh authorize us to use the funds for a different purpose than originally requested. And what are we gonna hold it somewhere for a while until we figure out what to do with that or is that the plan? No, Mayor and Councilmember Adams, we don't actually, these are um reimbursement grants, so anything from HUD is a reimbursement. So it's basically a credit for the for Mesa, and we draw down it, we draw down those funds for an eligible activity. So we haven't drawn down any of these particular funds yet. Understood. Um but what we do need to do is modify them to the uses that we would like to move it to. Um once that's approved. It does take about 60 days to go through HUD once we have approval from council. Um, and then those funds would be available for a program to be determined at a later time. To be determined, okay.
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