March 5, 2026 Study Session

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OFFICE OF THE CITY CLERK

COUNCIL MINUTES

March 5, 2026

The City Council of the City of Mesa met in the Study Session room at City Hall, 20 East Main Street, on
March 5, 2026, at 7:30 a.m.

COUNCIL PRESENT COUNCIL ABSENT OFFICERS PRESENT
Mark Freeman None Scott Butler

Scott Somers Holly Moseley

Rich Adams Jim Smith

Jennifer Duff

Alicia Goforth

Francisco Heredia
Dorean Taylor

Mayor Freeman conducted a roll call.

1. Review and discuss items on the agenda for the March 9, 2026, Reqular Council meeting.

All of the items on the agenda were reviewed among Council and the following was noted:
Conflict of interest: None
Items removed from the consent agenda: None

In response to a request from Vice Mayor Somers regarding agenda Item 4-e, (Three-Year Term
Use of a Cooperative Contract for Pavement Management Services for the Transportation
Department (Citywide)), on the Regular Council Meeting agenda, Transportation Director Erik
Guderian introduced Transportation Field Operations Superintendent Craig Brisbois and
displayed a PowerPoint presentation. (See Attachment 1)

Mr. Guderian provided an overview of the City of Mesa’s (COM) pavement management strategy
and the proposed procurement of new software to improve pavement planning and forecasting.
He explained that Light Detection and Ranging (LIDAR) surveys will be conducted on all roads
over the next three years and the data will be uploaded into the new system. He noted that this
effort was identified as part of the Transportation audit and the new system will provide automated
forecasting and more accurate data to better plan future pavement maintenance. (See Pages 2
and 3 of Attachment 1)

Mr. Guderian reviewed standard pavement treatments and their associated costs. He described
the different types of preservation treatments. He stated that without maintenance, pavement life
is typically about 15 years before mill and overlay is needed, while a regular maintenance program

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can extend the life of residential and collector streets to approximately 25 to 30 years. He
emphasized that sealing treatments are significantly less expensive than mill and overlay and
stated that the new software will help staff better target treatment areas and plan around delays
caused by utility and fiber installation work in certain neighborhoods. (See Pages 4 and 5 of
Attachment 1)

Responding to a question from Councilmember Adams, Mr. Guderian described the mill and
overlay process and said the COM sets aside approximately $20 million annually for
neighborhood mill and overlay work, which is completed on an as needed basis rather than evenly
across all areas. He noted that some areas may not require this treatment as soon as others and
acknowledged that the process can be disruptive for residents while the work is underway.

In response to a question from Councilmember Goforth, Mr. Guderian explained that
reconstruction is typically considered only for arterial streets experiencing heavy vehicle or truck
traffic where the pavement and underlying subbase have significantly deteriorated.

Responding to a question from Mayor Freeman, Mr. Brisbois verified that the new in-house
equipment for residential street work has reduced costs to approximately half as much as using
contractors and has proven successful in targeted areas of the city.

Mr. Guderian added that the COM continues to evaluate which projects can be completed
internally on a smaller scale and in a timelier manner, while larger projects, such as quarter-
section work and arterial improvements, continue to be handled through the engineering process
and completed by contractors.

In response to a question from Councilmember Taylor, Mr. Guderian confirmed that the extensive
roadway removal work being done at Val Vista Drive and Southern Avenue is part of a major
Capital Improvement Project rather than routine pavement maintenance and explained the
process completed to prepare for the new pavement installation.

Responding to a question from Councilmember Heredia regarding the scope of signal loop
detection throughout the city, Mr. Guderian recalled that the COM currently operates 508 traffic
signals that use several different forms of vehicle detection. He pointed out that induction loops
remain the preferred standard because they are the most effective at detecting vehicles and that
camera-based detection can be less reliable. He added that new signal construction is designed
to include loop detection when possible, and the current contract is intended to repair and replace
broken loops within the existing system while the COM continues to evaluate emerging
technologies and improved detection methods.

Responding to a question from Mayor Freeman regarding agenda Item 5-a, (Approving and
authorizing the City Manager or designee to enter into the Power Purchase and Energy
Storage Agreement for the Pinal Solar Project ("Project") with Arizona Electric Power
Cooperative ("AEPCO"), as negotiated by all ten (10) Project participants and as approved
by the AEPCO Board of Directors on January 14, 2026. (Districts 1, 3, and 4)), on the Regular
Council Meeting agenda, Energy and Sustainability Director Scott Bouchie introduced Energy
Resources Coordinator Deborah Ferraro and displayed a PowerPoint presentation. (See
Attachment 2)

Mr. Bouchie recalled that a resolution was approved by the Council in October 2024 authorizing
staff to negotiate an agreement with Arizona Electric Power Cooperative (AEPCO) for a utility-

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scale solar and battery storage project and confirmed that negotiations had been completed and
that the final agreement would be presented for approval at the next Regular Council meeting.

Ms. Ferraro described the Pinal Solar Project as a unique opportunity for the COM and pointed
out that the contract includes a 20-megawatt solar component and a 20-megawatt battery energy
storage system under a 20-year agreement beginning in 2027. She explained that the power
generated through the project would be delivered into Mesa, routed to the Rogers Substation,
and fed directly into the COM’s electric system. She reported that this would be Mesa’s first utility-
scale solar project and stated that the COM would benefit from economies of scale, allowing the
procurement of solar energy at a lower cost than could otherwise be obtained independently. She
stated that the project includes 400 megawatts of generation and approximately 400 megawatts
of battery storage and noted that the project aligns with the COM’s Integrated Resource Plan and
customer priorities of cost, reliability, and sustainability. (See Pages 2 and 3 of Attachment 2)

Ms. Ferraro reviewed the City’s current power supply portfolio, including the range of prices paid
under existing contracts based on the amount of power procured. She explained that AEPCO
currently provides approximately 25% of the COM’s power, while other solar resources make up
a smaller share of the overall portfolio and vary in cost. She outlined the COM’s other procurement
methods, including resource management purchases, monthly and _ traditional bilateral
agreements, and wholesale purchases made through Western Area Power Administration
(WAPA), which aggregates member needs to secure discounted pricing. She noted that Mesa
also benefits from legacy hydropower contracts with favorable pricing. She confirmed that the
COM’s mix of contracts and diverse resources helps meet customer power needs while managing
cost and reliability. (See Page 4 of Attachment 2)

In response to a question from Mayor Freeman, Ms. Ferraro reported that the COM’s demand
reached approximately 90 megawatts on the hottest day of the year and noted that usage
continues to trend upward, although capacity remains available for future growth. She explained
that longer term contracts generally carry higher prices, and the methods used to offset market
volatility. She noted that, because power cannot be stored, coordination through WAPA has
helped the COM identify needs, make group purchases, and complete trades with other
participants when necessary.

Councilmember Taylor commented that the solar agreement represented a significant benefit to
the COM and pointed out that the COM would not be constructing a solar facility but purchasing
power from the Pinal County project as part of its overall portfolio at a locked-in, long-term rate.

Ms. Ferraro highlighted additional benefits of the Pinal project, noting that the 20-year contract
would enhance long-term reliability, strengthen the security of the COM’s power resources, and
add greater diversity to the energy portfolio. She emphasized that the proposed agreement
provides consistent, locked-in pricing over the life of the contract and explained that the battery
energy storage system would allow solar energy generated during the day to be stored and used
later when market prices are highest which would help reduce peak demand, lessen the need to
purchase higher-cost power from other sources, provide greater operational flexibility, and
improve overall grid stability by allowing the COM control when the stored energy is discharged.
(See Page 5 of Attachment 2)

Ms. Ferraro reviewed data illustrating the COM’s renewable and traditional power portfolio. She
explained that, in FY 25-26, solar represented 1 % of the portfolio, increasing to 2% once the two
downtown solar projects reach full operations. She reported that looking ahead to FY 28-29, that
the AEPCO project would represent 15% of the portfolio and, with the addition of the Pinal Solar

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Project, renewable resources would increase from 35% to 57% of the COM’s overall portfolio.
She pointed out that the remaining portion consists of other contracts, including long-term bilateral
agreements, reverse auctions, and Rainwater Management Solutions (RMS) purchases. She
reviewed the projected load demand compared to existing and planned resources and stated that
the scenario without the Pinal Solar Project shows a gap between available resources and
projected load beginning in 2027. (See Pages 6 and 7 of Attachment 2)

Responding to a question from Vice Mayor Somers, Ms. Ferraro confirmed that if hydropower
deliveries are reduced under the Colorado River Storage Project (CRSP) contract, WAPA
provides replacement power or, under its new 2025 program, offers cash in lieu of power, allowing
the COM to choose the option that provides the greatest financial benefit to customers.

In response to a question from Councilmember Adams, Mr. Bouchie stated that the agreement
offers Mesa a very low-cost, long-term power source that supports diversification, sustainability,
and cost certainty, while avoiding the risks of relying too heavily on volatile short-term market
purchases.

Discussion ensued regarding the importance of securing reliable power at a reasonable rate.
Mayor Freeman thanked staff for the presentation

Mayor Freeman declared a recess at 8:19 a.m. The meeting reconvened at 8:29 a.m.

Hear a presentation, discuss, and receive an update on the Sunaire renovation project and the

associated Off the Streets Program.

Deputy City Manager Candace Cannistraro introduced Assistant Police Chief Dominique Sterlin,
Community Services Deputy Director Lindsey Balinkie and Human Services Administrator
Jussane Goodman, and displayed a PowerPoint presentation. (See Attachment 3)

Ms. Balinkie provided contextual information and data from the Maricopa County Homeless
Trends Report. She reported that, in 2024, for every 10 individuals who found housing and exited
homelessness, 19 new individuals entered the system in need of services. She added that
homelessness continues to increase significantly and pointed out that an average of 962 new
households experienced homelessness for the first time last year causing shelters, bridge housing
programs, and related services to experience long waitlists and difficulty meeting the demand.
She recalled that County data for December 2025 showed more than 15,000 single individuals,
couples, and families in need of services during that month, with approximately 18% of those
individuals coming from the COM. (See Page 2 of Attachment 3)

Ms. Balinkie reviewed the regional shelter bed capacity, noting that 296 of those beds are in the
COM, which has since been reduced by 74 shelter beds. She added that if the Off the Streets
beds were no longer counted, only 133 beds would remain available for Mesa residents, the
majority of which would serve single men at the East Valley Men’s Center. She discussed the loss
of emergency housing voucher services which served 76 households and will no longer be
available as a resource. She reported that 205 COM based individuals would be impacted by the
loss of voucher services and cautioned that without those services and supports, many of those
individuals could return to homelessness, increasing pressure on the region’s homeless response
system. (See Page 3 of Attachment 3)

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Ms. Balinkie advised that several regional cities initially used Coronavirus Aid, Relief, and
Economic Security (CARES) Act and American Rescue Plan Act (ARPA) funding to support
shelter and homeless services and have since continued those efforts with general funds after
the federal funding ended. She highlighted the services and number of shelter beds provided by
surrounding cities and pointed out that East Valley cities work together year-round to connect
residents to services, coordinate outreach efforts, and ensure each community helps meet the
needs of its own residents while sharing responsibility across the region. (See Page 4 of
Attachment 3)

Ms. Balinkie explained that the COM’s crisis response model is designed to move individuals in
need to the next safe place as quickly as possible and connect them with appropriate services.
She pointed out that the contract with Solari for mental and behavioral health services, originally
supported with ARPA funding, has continued and helps by reducing the need for police and fire
personnel to act in a social services role. She stated that the Human Services Division and its
partner agencies work together as an integrated system based on community needs. She
emphasized that when services are available, the impact on COM departments is reduced, but
when services are diminished, the burden on police, fire, parks, and other departments increases.
She confirmed that the services are delivered through strong contracts designed to meet
community needs and reduce the burden on frontline City departments. (See Pages 5 and 6 of
Attachment 3)

Ms. Balinkie pointed out that homelessness remains a significant issue affecting cities locally and
nationwide, and that the COM will bear costs either through direct service investments or through
increased impacts on police, fire, parks, libraries, neighborhoods, and businesses if services are
reduced. She explained that the COM has refined its homelessness response programs by
moving away from a siloed approach and developed a more collaborative model involving COM
departments, faith-based organizations, and community service providers to help reduce
pressure on public safety resources. (See Pages 7 through 9 of Attachment 3)

Assistant Chief Sterlin explained that the Mesa Police Department (MPD), including the
Professional Services Bureau, work collaboratively on initiatives intended to help keep the COM
a safe and desirable community. He explained some of the complex community impacts
presented by homelessness and the experiences of first responders and coordinating the
appropriate units based on the circumstances encountered. He emphasized that homelessness
and related human services issues can divert MPD resources from other serious public safety
matters, making coordination with Human Services and other partners essential. He confirmed
that the MPD works in partnership with COM departments, transit providers, outside agencies,
and community partners to address citywide needs. He reiterated that coordination among
libraries, downtown teams, street outreach efforts, heat relief strategies, and outreach and
supportive services provides a more effective and cost-efficient approach than relying solely on
arrests. (See Page 10 of Attachment 3)

In response to a question from Councilmember Duff, Assistant Chief Sterlin stated that while
homelessness-related challenges will continue to require a team approach, the absence of
support services currently provided at Windemere and proposed at Sunaire would complicate
matters for the Police Department. He explained that without those resources, officers would
spend additional time addressing issues outside their primary enforcement role, which would
reduce their capacity to focus on criminal activity and other core public safety responsibilities. He
added that, although he could not quantify the exact effect, he believed the loss of those resources
would have a definite impact.

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Responding to a question from Councilmember Heredia, Assistant Chief Sterlin commented that
while no single program will end homelessness, the Off the Streets program has been helpful in
addressing the issue and supporting law enforcement efforts.

In response to a question from Councilmember Adams, Ms. Balinkie advised that COM staff track
program support provided to the MPD and reported that, over the last calendar year, 222 referrals
were made into shelter and case management programs, with additional instances of assistance
likely not formally documented.

Ms. Goodman shared examples of how the Off the Streets program serves the COM’s most
vulnerable residents. She explained the dynamics of the program, which has primarily served
COM residents and currently operates 85 rooms at the Windemere Hotel. She noted that the
program works closely with first responders and Community Court to provide direct referrals into
shelter and support individuals in breaking the cycle of homelessness. She stated that required
case management helps participants address barriers to housing and connect to employment,
medical care, behavioral health, substance abuse treatment, and school support. She provided
examples of successful outcomes, including individuals who were connected through first
responders and later secured more stable housing arrangements. (See Pages 11 and 12 of
Attachment 3)

Ms. Goodman provided data of families and individuals served by the Off the Streets program as
of March 1, 2026, or on the current waitlist. She noted that those on the waitlist were determined
appropriate for the program by Phoenix Rescue Mission and are COM residents or have ties to
the community, such as prior residency, involvement with Mesa Community Court, children
attending Mesa Public Schools, or are receiving medical care in the Mesa area. She added that
without the program, those households would instead be placed on a much larger emergency
shelter waitlist of approximately 190 families, where waits for family shelter services can range
from 16 to 18 weeks. She reported that the program had achieved an 86% positive exit rate and
noted that the most common reasons individuals entered the program were financial hardship
and employment-related challenges. (See Pages 13 and 14 of Attachment 3)

Ms. Goodman explained that one of the largest exit destinations from the program is placement
in another homeless shelter, which she described as a positive outcome for many participants
with high acuity needs, including medical, mental health, domestic violence, or other significant
barriers that may require more time and support than the program can provide. She stated that,
in those cases, individuals and families are connected to other shelter programs so they can
continue working toward stable housing and end homelessness. She confirmed that 66% of heads
of households who exit the program do not access homeless services again within 12 months,
and the remaining 34% may return to the system for a variety of reasons, including recurring
domestic violence, ongoing medical issues, rising housing costs, fixed incomes, or continued
participation in the continuum of care as part of their housing plan. (See Page 15 of Attachment
3)

Discussion ensued regarding the success rate of the program and continuum of care for the
participants.

Ms. Cannistraro explained that the Off the Streets program functions as an emergency crisis
response intended to stabilize individuals and families and assess their needs through intake and
case management. She explained the role of the case managers is to provide a warm handoff so
participants clearly understand their next steps and can continue progressing toward self-
sufficiency. She verified that regional coordinated data could show whether an individual reenters

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the homeless services system within Maricopa County but would not capture outcomes for those
who leave the region or move out of state. She pointed out that staff are still working to better
define what long-term outcome data should be tracked and reported, noting that while long-term
success remains the goal, the program is still refining how to clearly measure and present those
outcomes.

City Manager Scott Butler clarified that staff did not want the data to be presented in a way that
could be viewed as misleading and noted that stabilizing individuals and moving them off the
streets into shelter is a positive outcome, even if it does not yet represent the ultimate goal of
permanent housing and self-sufficiency. He stated that staff would continue reviewing how
program outcomes are described and measured to ensure the data is communicated clearly and
accurately. He explained that other communities had experienced encampments overtaking
parks, vacant lots, and other public spaces, creating public health hazards and requiring
significant police response and intervention, and that COM sought to avoid those conditions by
ensuring individuals could be moved off the street and into some form of shelter or safer setting.

Ms. Goodman continued by saying that staff explored several alternative program models,
including Family Promise, Eden Village, and The Other Side Village in Salt Lake City, Utah. She
stated that staff met individually with each organization to better understand how the programs
operate. She provided the details of each program model and how they are funded. (See Page
16 of Attachment 3)

Councilmember Heredia acknowledged that each of the alternative housing and shelter models
reviewed appeared to involve some form of government support, whether through direct funding,
indirect revenue sources, or contributions such as land. He added that based on prior experience
reviewing homelessness response models in other communities, most programs include some
level of government involvement or public support, which often helps leverage additional private,
faith-based, and philanthropic funding. He emphasized that homelessness is a complex issue
requiring shared responsibility among multiple sectors and noted that government participation is
often a necessary component in expanding resources and services to address the problem.

Ms. Cannistraro stated that staff welcomes Council suggestions on additional program models to
explore and will continue researching creative approaches, noting that both permanent and
transitional housing options are needed to serve different populations and needs.

In response to a question from Councilmember Goforth, Ms. Goodman confirmed that the House
of Refuge is funded by private investment and grant funding. She stated that is located on the
former Air Force base and was developed as part of a broader effort to repurpose existing land
and buildings and serves as an effective bridge from emergency shelter for families and would be
considered a successful transition toward permanent housing.

Councilmember Duff pointed out that House of Refuge was developed on land donated by the
COM and continues to rely on a combination of City funding, grants, and other ongoing resources
rather than solely private support. She referenced Family Promise’s new single-family home
model, which she said is expected to serve approximately 60 individuals annually, and added that
a range of models, including family-focused and permanent housing options, will be necessary to
help address community needs.

Councilmember Adams added that, regardless of the structure, public resources or tax-supported
contributions are involved in many of these models in one form or another.

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Ms. Cannistraro provided an overview of the Off the Streets program and the efforts made to
improve its efficiency and effectiveness. She explained that the COM used federal ARPA funding
to purchase the former Grand Hotel for conversion to the Sunaire site and the core structure of
the program would remain the same through the transition. She stated that the Sunaire location
offers several operational and safety improvements and is more secure for the vulnerable
populations served, including children, seniors, and domestic violence survivors. She confirmed
that all rooms have been made ADA accessible, exterior security cameras have already been
installed and connected to the real-time crime center, and additional interior cameras will be
added once occupancy is approved. She said the site’s interior hallway design and single main
entry point will also make it easier to control access and enforce visitor policies. (See Page 17 of
Attachment 3)

Ms. Cannistraro reported that moving the program to the Sunaire site is expected to generate
ongoing savings by eliminating the need to lease rooms at Windemere and explained that the
COM currently maintains separate contracts for room leasing and case management. She
reiterated that the new site would allow the COM to have greater control over operations and is
in the process of selecting a nonprofit contractor through a Request for Proposal (RFP) for case
management and property management services. She added that several nonprofits submitted
proposals and staff were in the final stages of selection. She emphasized that the COM’s role is
to provide coordination, contract management, oversight, quality control, and reporting, while
partnering with nonprofit organizations that serve as the subject matter experts in delivering
program services. (See Page 18 of Attachment 3)

Ms. Cannistraro recalled that when the hotel was purchased for conversion in 2023, the COM
conducted community surveys to better understand residents’ expectations regarding the City’s
role in addressing homelessness. She reported that 48% of residents identified homelessness as
an issue in the COM and 71% believed it was the COM’s responsibility to address it. She verified
that staff had worked closely with the surrounding Sunaire neighborhood and based on
community feedback, completed improvements such as additional street lighting and other area
enhancements. She pointed out that certain improvements requested by neighbors, including
sidewalks, were not feasible due to cost and the potential impact on street width and on-street
parking in the former county island neighborhood. She emphasized that staff would continue to
engage the neighborhood and establish a Good Neighbor Policy with a single point of contact for
addressing concerns moving forward. (See Page 19 of Attachment 3)

Discussion ensued regarding neighborhood concerns in the area of the Windemere, Sunaire, and
the Main Street corridor, and the 2023 survey feedback from the community expressing a need
to take action to address homelessness.

Mr. Butler agreed that the community remains deeply concerned about homelessness and said
the question is not whether the COM should respond, but how it should do so, and that the
community expects action and likely supports exploring a range of approaches, including public
and private funding, so long as the response is effective and does not place an undue burden on
any one area of the city.

Councilmember Adams stated that he believed most residents want the homelessness issue
addressed, but that the key question is how to do so in the most effective and equitable manner.
He noted that public support for action does not necessarily mean support for a specific level of
spending and said the discussion should focus on identifying the best approach to addressing the
issue fairly and effectively considering current conditions.

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Ms. Cannistraro explained that staff had evaluated how to make the program more effective,
efficient, and better aligned with its goals as it transitions to the Sunaire site and stated that the
program model would be adjusted to focus on the most vulnerable populations, including families
with minor children, elderly individuals, and domestic violence survivors. She noted that single
adult men would generally not be served through the revised model, as that population could be
referred to the East Valley Men’s Center and other partner programs. She pointed out that the
Sunaire site is expected to improve program efficiency and better support successful transitions
to the next step in housing. She pointed out that the 1.3-acre Sunaire site will have one main
entrance from Main Street and limited gated access on the south and east sides, and that only
program participants and preapproved individuals would be allowed on site, while transportation
for services and case management would continue to be coordinated. (See Page 20 of
Attachment 3)

Ms. Cannistraro reviewed the project timeline and recalled that, as part of the purchase, Maricopa
County contributed $4 million through an intergovernmental agreement requiring the property to
operate as emergency shelter for at least 10 years or the funds would need to be repaid. She
reported that construction began in January 2025 and was expected to be completed by late
March or early April 2026. She reiterated that staff are conducting an RFP process to select a
nonprofit provider to operate the site, and once a certificate of occupancy is issued, the rooms
will be furnished and supplied for turnkey operation. She anticipated a transition period between
April and June for the selected provider to hire staff and prepare the site, with the first participants
expected to be served during the summer. She added that staff plan to hold a community open
house before occupancy begins so residents can better understand the program’s safeguards,
participant rules, and police presence on site and in the surrounding neighborhood. (See Pages
21 and 22 of Attachment 3)

Ms. Cannistraro reviewed the financial framework for the project and stated that ARPA interest
earnings had accumulated while the funds remained in the account. She explained that moving
the program from Windemere to Sunaire would reduce costs on a per room basis and provide
more certainty around future costs and operational control, rather than relying on leased hotel
rooms with rates that may change annually. She noted that while the number of rooms would
decrease from 85 at Windemere to 64 at Sunaire, the new room layout would reduce total bed
capacity by only five beds. She said the redesigned program would also allow for meal service,
including two grab-and-go meals per day, which is not currently available at Windemere, where
participants must leave the site to access food. She remarked that staff expect to better
understand meal demand once the program is operational, particularly since many children eat
meals at school. (See Pages 23 and 24 of Attachment 3)

Ms. Cannistraro outlined potential alternatives and impacts if the COM does not move forward
with the Sunaire site. She pointed out that one option would be for the facility to operate as an
emergency shelter under a nonprofit provider without COM funding, but staff would need
additional information to determine whether a qualified nonprofit had the capacity and interest to
do so. She noted that informal discussions with nonprofit providers suggested that there was not
an organization that currently felt able to take on the operation independently. She added that if
the COM were to rely solely on an outside provider, the same level of control over eligibility,
program structure, and service delivery would be lost. She also noted that the Police Department
would still likely need to remain involved in the area as part of the Good Neighbor Policy. (See
Page 25 of Attachment 3)

Ms. Cannistraro explained that the current General Fund forecast already includes approximately
$2.5 million annually for the Sunaire operating model, and moving forward would not increase

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that forecast; however, not proceeding could increase costs. She discussed that should the City
sell the property and continue operating at Windemere, the operating costs there would remain
at approximately $3 million annually for 85 rooms, representing an increase of about $500,000
that is not currently built into the forecast. She advised that, because federal and county funds
were used to purchase and renovate Sunaire, selling the property could trigger repayment
obligations, including repayment of the $4 million to Maricopa County and potentially up to $9.2
million to the U.S. Treasury, depending on federal guidance. She stated that, at best, the COM
might only be allowed to return the sale proceeds, while at worst it could be required to return the
full amount of federal funds invested. She reported that keeping the site vacant while awaiting
sale would create additional maintenance and insurance costs and that continued operation at
Windemere could face future risk due to possible legislation affecting mixed hotel uses. (See
Page 26 of Attachment 3)

Ms. Cannistraro emphasized the goal to open Sunaire this summer and that the projected
$500,000 savings would help align the program with next year’s budget. She reported that staff
had identified additional one-time federal funds to support Sunaire operations, including
approximately $1.7 million in HOME-ARP funds and about $800,000 in general fund support for
three years. She explained that the HOME-ARP funds had originally been considered for bridge
housing or private development gap financing, but those plans had not come to fruition, and the
funds could instead be redirected to emergency shelter operations. She confirmed that staff would
continue pursuing partnerships, sponsorships, donations, and grant opportunities, noting that a
site such as Sunaire would likely be more competitive for outside funding than a program operated
within a privately-owned hotel.

Responding to a question from Councilmember Heredia, Ms. Cannistraro confirmed that the
Sunaire program would reduce the COM’s net General Fund cost over the next three years while
enhancing services. She explained that the current Windemere model costs approximately $3
million annually, while the Sunaire model is budgeted at $2.5 million and already included in the
forecast. She added that approximately $1.7 million in federal funds would offset that amount,
reducing the COM’s net contribution to about $800,000 while still allowing the program to provide
enhanced services. She confirmed that many members of the faith community have asked how
they can help, and staff have encouraged them to wait until the program transitions to Sunaire so
those partnership opportunities can be better organized and that discussions have already
occurred with churches regarding support such as food assistance. She reiterated that staff would
continue pursuing partnerships that could further reduce reliance on the General Fund.

Additional discussion ensued regarding the financial impact of proceeding with the project or
moving in a different direction.

Responding to a question from Councilmember Taylor, Ms. Cannistraro clarified that staff had not
conducted a formal feasibility study with nonprofit providers but had instead engaged in informal
discussions with organizations they work with regularly. She explained that, if neither Windemere
nor Sunaire were available, many of the individuals and families served would not have immediate
program options and would instead be placed on the regional shelter waitlist where approximately
190 families were already waiting and the current wait for shelter placement was estimated at 16
to 18 weeks. She added that the Sunaire operating budget includes public safety-related costs,
including on-site police presence, and noted that one officer currently provides 24-hour coverage
at Windemere, with additional officers responding if needed. She confirmed that calls for service
vary and are not necessarily crime related. She added that insurance costs for Sunaire are
included in the projected $2.5 million budget. She stated that street outreach resources are
currently concentrated at the Main Library because that location has the greatest demand.

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City Attorney Jim Smith advised that the COM would manage liability exposure in the same
manner as it does for other COM-owned properties, noting that he was not aware of any claims
related to the Windemere operation to date.

Councilmember Taylor expressed concern that the COM’s core responsibilities are public safety,
roads, water, and infrastructure, and questioned whether direct shelter and social service
operations should be a municipal function. She stated that shelters can be costly to operate,
difficult to sustain over time, and may create liability and budget pressures, particularly during
periods of fiscal constraint. She provided her opinion that private and nonprofit organizations may
be better positioned to provide long-term care and support and stated her opposition to the project
while acknowledging the need to continue seeking solutions and partnerships.

Councilmember Duff emphasized that homelessness in the COM affects real people and that
existing family shelter capacity is limited, waitlists are long, nonprofit and faith-based
organizations do not have the resources to absorb the full need on their own, and that many
people experiencing homelessness have exhausted all other options. She pointed out that
transitioning the program to Sunaire is important to avoid compounding homelessness impacts
and to honor the COM’s existing commitment to provide shelter solutions. She expressed her
opinion that the issue should be addressed by treating underlying causes and supporting solutions
rather than only responding to symptoms. She stressed that addressing housing instability
requires a shared effort among the COM, nonprofits, faith communities, and other partners.

Councilmember Heredia stressed that homelessness is a regional and ongoing challenge and
noted that Mesa’s leadership has helped advance regional progress on homelessness since 2018
and that the COM should continue building on that work rather than reducing its efforts. He said
the issue has broad impacts across multiple service areas and remains a critical component of
the COM’s overall response.

Responding to a question from Mayor Freeman, Mr. Smith explained that the City Charter
functions as a high-level governing document and does not prescribe the specific manner in which
the COM must operate individual programs. He added that funding social services programming
is a lawful activity, and that the Charter does not specifically require or prohibit the COM from
doing so.

Mayor Freeman stated that historically the COM had been involved in homelessness and housing
related efforts in various ways and he indicated that he would like to continue using the
Windemere site as a temporary housing option for public safety and community response
purposes in coordination with existing partners. He directed staff to continue evaluating the
Sunaire property, including obtaining an appraisal and further reviewing the repayment obligations
to Maricopa County and any other funding-related requirements, before moving forward with the
transition to that site, and noted that there were still several unresolved factors that should be
addressed before committing to Sunaire. He mentioned that the previously discussed $1.7 million
in funds could potentially be applied to support Windemere operations while additional
negotiations and analysis are completed.

Mr. Butler reported that ARPA funding for the program remains available through the end of the
calendar year and that approximately a half year of funding is currently included in the budget,
which allows time to continue evaluating options without needing to act immediately. He added
that staff would return at a later date with more concrete options for Council consideration.

Study Session

March 5,

Page 12

2026

Responding to a question from Councilmember Goforth, Ms. Cannistraro confirmed that
furnishings, fixtures, and equipment costs remained in the budget and that some funds had
already been spent, while additional furniture would still need to be purchased. She explained
that approximately $430,000 was budgeted for those purposes and reiterated that, although the
COM would incur those one-time setup costs, the ongoing annual operating budget would
decrease from approximately $3 million at Windemere to $2.5 million at Sunaire. She pointed out
that any change allowing Windemere rooms to be made available to the public would require
further discussion with the property owner because the current arrangement does not permit
public room availability.

Councilmember Goforth stated that she had voted against the purchase of the property initially
and remained consistent in that position and stated that she did not believe owning and operating
a shelter fall within the COM’s core services. She expressed concern that property ownership
limits flexibility and given that the project was still not operational three years later, a model outside
direct COM ownership might have moved more quickly.

Vice Mayor Somers discussed that the issue was not whether homelessness should be
addressed, but how to address it, noting that personal hardship can become a broader public
problem if left unresolved. He said conditions such as large encampments seen in other cities
would not be acceptable in Mesa and emphasized the need to identify an effective approach. He
confirmed that while he was not prepared to support moving forward immediately with the Sunaire
transition, the COM should not allow the current Windemere program to lapse without an
alternative in place. He agreed to postpone the decision to allow additional time to evaluate other
funding sources, including grants and nonprofit-operated models, and to explore whether services
could eventually be transitioned to a model that minimizes or avoids the use of local tax dollars
for operations.

Mayor Freeman thanked staff for the presentation and confirmed Council direction is to postpone
moving ahead with the Sunaire program pending additional information from staff.

Acknowledge receipt of minutes of various boards and committees.

3-a. | Housing and Community Development Advisory Board meeting held on December 9,
2025.

3-b. Audit, Finance and Enterprise Committee meeting held on January 22, 2026.

It was moved by Councilmember Adams, seconded by Councilmember Heredia, that receipt of
the above-listed minutes be acknowledged.

Upon tabulation of votes, it showed:

AYES — Freeman—Somers—Adams—Duff—Goforth—Heredia—Taylor
NAYS — None

Carried unanimously.

Current events summary including meetings and conferences attended.

Mayor Freeman and Councilmembers highlighted the events, meetings, and conferences recently
attended.

Study Session
March 5, 2026
Page 13

5. Scheduling of meetings.

City Manager Scott Butler stated that the schedule of meetings is as follows:
Monday, March 9, 2026, 5:15 p.m. — Study Session
Monday, March 9, 2026, 5:45 p.m. — Regular Council

6. Convene an Executive Session.

6-a. Discussion or consultation with the City Attorney and outside legal counsel regarding the
proposed schedule of fees and charges for Falcon Field Airport and a 14 CFR Part 13
complaint and investigation related to Falcon Field and any potential, pending or
contemplated litigation thereto. (A.R.S. § 38-431.03(A)(3) & (4))

It was moved by Councilmember Taylor, seconded by Vice Mayor Somers, that the Council
adjourn the Study Session at 11:08 a.m. and enter into an Executive Session.

Upon tabulation of votes, it showed:

AYES — Freeman—Somers—Adams—Duff—Goforth—Heredia—Taylor
NAYS — None

Carried unanimously.

7. Adjournment.

Without objection, the Study Session adjourned at 12:12 p.m.

MARK FREEMAN, MAYOR
ATTEST:

HOLLY MOSELEY, CITY CLERK

| hereby certify that the foregoing minutes are a true and correct copy of the minutes of the Study Session
of the City Council of Mesa, Arizona, held on the 5" day of March 2026. | further certify that the meeting
was duly called and held and that a quorum was present.

HOLLY MOSELEY, CITY CLERK

sr
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