Mesa council approves utility-rate package after public pushback; residential increase cut to 2.5%

The Mesa City Council on Dec. 1 approved a package of utility rate and fee adjustments covering electric, natural gas, water, wastewater and solid waste after a prolonged public hearing and internal compromise.

Brian Richel, director of the Office of Management and Budget, told the council the package was designed to restore equity between residential and commercial customers, encourage conservation and smooth increases over time. Richel said staff initially modeled larger increases but revised them after council direction; the adopted compromise reduces the residential increase to 2.5% while applying larger adjustments to commercial and landscape rates to move revenue shares toward parity.

Richel described the fiscal context: the utility fund was projected to have nearly a $29 million net negative for fiscal 2026 if adjustments were not made due to higher chemicals, electricity and operations costs. He also said the newly proposed capacity fee will shift growth costs toward new development and is intended to recoup capital needs over the next decade.

During the public hearing dozens of residents urged postponement or rejection, citing affordability for families and small businesses and asking for clearer accounting of transfers from the utility fund to the general fund. Reid Gottschalk, a resident, said rate changes were making Mesa less affordable for young families and asked for “full transparency about where these additional dollars are going.” Several speakers urged delaying increases and requested clearer justification for a $9.4 million projected increase in the utility-to-general fund transfer in the forecast.

Council discussion reflected the tension: one councilmember proposed a 0% residential increase, prompting negotiations that produced the 2.5% compromise as a way to protect residential customers while addressing projected shortfalls. Vice Mayor Go Forth and other members framed the compromise as a necessary but modest adjustment after the audit and finance committee’s review.

The council then voted on the items individually. Motions to approve items 10a (electric), 10b (natural gas), 10c (water), 10d (wastewater) and 10e (solid waste) passed in separate roll calls.

What’s next: Staff said implementation steps include notices of intent and additional hearings where required; water-rate ordinance actions were scheduled for later adoption dates with implementation timing explained by staff.