Mesa proposes one-third cut to large-user water threshold
City of Mesa Utilities Department, Arizona · Meeting date: October 29, 2026 · Published: October 30, 2026
Mesa City Council has reviewed a proposed overhaul of its large water user ordinance that would lower the annual demand ceiling by about one-third and require conservation plans for permitted users. The city aims to preserve flexibility for industrial growth while requiring customers seeking water above the ceiling to provide acceptable supplies.
Key points
- The proposed annual demand ceiling would fall from 330 acre-feet to 224 acre-feet, a reduction of nearly 100,000 gallons per day.
- Customers requiring water above the ceiling would continue to need a permit and allowance, but Mesa would consider groundwater rights and other acceptable resources alongside long-term storage credits.
- A conservation plan would become a permit-application requirement and an ongoing obligation for large users operating under an allowance.
- Mesa has had no new water-cooled data centers since 2021; it has two such facilities, while other data centers use air cooling.
- Staff said it expects to return later in the fall with ordinance adoption proposals for the large-user rules and Water Shortage Management Plan.
Full report
Mesa is proposing to lower the water-use threshold governing its largest customers from 330 acre-feet a year to 224 acre-feet, bringing more industrial and commercial demand under a permit-based framework designed to protect the city’s supplies.
The proposed reduction, discussed by City Council on 29 October, is about one-third of the current ceiling and equivalent to nearly 100,000 gallons per day. Customers whose use exceeds the ceiling must obtain a permit and an approved allowance before taking the additional water. Mesa said the 224 acre-foot level would align it with peer cities including Phoenix and Tucson.
The ordinance would retain exclusions for meters used solely for residential customers, hospitals and schools, although landscape-irrigation meters would remain subject to the ceiling. Existing qualifying customers affected by the lower threshold would not immediately have to obtain a permit unless their annual use exceeds 330 acre-feet.
Mesa’s current system requires customers seeking an allowance above the ceiling to provide long-term storage credits, which the city recovers on their behalf as demand occurs. Under the proposed revision, the city could also consider groundwater rights and other resources, subject to departmental review of whether they are legally available, reliable and beneficial to Mesa’s water portfolio. Customers would bear the cost of making those resources available.
Staff said the additional options respond to customer feedback while retaining the principle that water used above the city-set ceiling should not come from Mesa’s portfolio. Permit terms could vary according to demand and the resources supplied, with renewals allowing the city to reassess demand, supply availability and compliance.
A further proposed change would make a conservation plan mandatory as part of a permit application. The plan would have to be implemented and maintained, with customers also subject to shortage, drought, emergency and system-management measures under Mesa’s Water Shortage Management Plan. Supplying external resources would not exempt a customer from those measures or guarantee delivery of a specified volume.
Council members pressed staff on potential oversight of large allowances and long-term permits. Staff said it was considering options under which particularly large allowances could return to council through a development agreement, while shorter and longer permit terms could carry different requirements for customers to provide water resources.
Mesa said it currently has one customer with a sustainable water service agreement, three customers under permitting and another existing customer about to enter the process. The city adopted one of Arizona’s first large water user ordinances in 2019 and updated it in 2024.
Staff also highlighted the ordinance’s effect on data-centre cooling. Mesa has had no new water-cooled data centres since 2021 and has two in total, with other facilities using air-cooled systems. Before a project is supported, Mesa assesses projected demand, wastewater-discharge characteristics, and distribution and treatment-plant capacity.
The city expects to return later in the fall with proposed ordinance adoptions for both the large water user framework and an updated Water Shortage Management Plan.
This summary was generated by AI based on the source document and may contain errors.
Source: City Council Study Session, City of Mesa Utilities Department