Non-stop flights from Asia to Phoenix and back for the first time.
Record investments in semiconductors and biomedical research.
Funding shading projects to combat extreme heat.
Continued Sustainability improvements.
A favorable deal to keep the Arizona Diamondbacks in Phoenix.
Addressing the growth of the AI and Data Center Industries and their impacts on energy costs and water security.
Meeting the needs of Phoenix residents and first responders who may be impacted by federal cuts to Medicaid and Housing Assistance Programs.
Combatting road rage.
These were some of the issues Phoenix Mayor Kate Gallego addressed in the interview below, where she graciously discussed the positive developments that occurred in the nation’s fifth-largest city in 2025 and the goals and challenges going into 2026.
The questions and Mayor Gallego’s responses are below.
Please tell us your overall feelings about how 2025 went for you, the City Council, and the people of Phoenix.
2025 was an incredible year for the City of Phoenix. We had really great milestones in terms of economic development. For years, we’ve been the largest city without non-stop service to Asia, and that changed earlier this month when China Airlines, which is a Taiwan-based carrier, landed in Phoenix. In January, we’ll have another carrier, Starlux Airlines, that also flies to Asia. Sky Harbor Airport won an Airports Going Green award in the Outstanding Sustainability Program Category, which was exciting for me. We had the largest foreign direct investment in the country’s history with Taiwan Semiconductor on the same day in March, where Mayo announced a two billion dollar investment in the City of Phoenix. We had my favorite pop-up public art display so far, which was Sombra. It uses public art to create shaded spaces. We did it in each of our parks with incredible local artists. We had incredible public art on the South-Central Light Rail, which we opened. I got my start in politics representing the south side of Phoenix on the council and have been trying to work for light rail to get to the southern portion of our city for years. It was exciting to finally deliver there. We opened a new fire station, a new public safety call center, and we got funding for a critical water treatment and recycling plant. I was really pleased to help make sure the Diamondback deal better protected the city and our taxpayers. So very productive year!”
What are these three achievements you are proudest of seeing through during 2025?
The City of Phoenix is leading the way nationally and developing rules around data centers. The biggest growth in our economy right now is in the AI sector, seeing billions of dollars spent in that area. The city is obviously on the forefront of technology. We passed really important rules to make sure that data centers go where they belong and that they are cognizant of neighborhoods and neighborhoods’ needs. I was also really proud of the team effort to get $179 million in federal funds for advanced water purification. Phoenix is leading the way and preparing for a future where we see more drought and impacts from climate change. That was a nice, bipartisan success. And then I was very proud of getting a better deal with the Diamondbacks.”
What were two of the most pleasant surprises during your term this year?
“I really enjoyed Novel Ice Cream getting the award for the best ice cream in the country. Celebrated that in person. Lovely ice cream. I recently got to be a guest coach for ASU Women’s Basketball. We won the game on a buzzer-beater, which was an incredible shot. Had a lot of fun with that, and I am really excited about what coach Molly Miller and her team are doing.”
What have been at least two continuing or unexpected challenges during 2025 that you and the council had to handle, and may continue having to deal with in 2026?
“Road rage has been a really difficult Issue for the valley for a while, but it’s been heartbreaking this year. We’ve lost parents and children. We’re trying to do more to tell people, even if you see a terrible driver – and you get cut off in a really aggressive way – it’s not worth taking a life, and we all need to take time to calm down.”
“The demand from data centers for our power and water is one we still need to navigate carefully. I recently joined Governor Hobbs’s energy task force, which is looking at those issues. We have one of the largest growth rates of that industry in the world. We see international private equity money come in from multiple countries. We need to make sure we invest in AI infrastructure in a way that is responsible with our energy and water needs.”
The City has made tremendous improvements in tackling extreme heat, like shading, and so forth. Are there still lingering challenges in addressing that?
“The city’s been recognized as an international leader in heat management. We make improvements every year. I am really proud that the council unanimously passed a plan for tens of millions of dollars in investments in shade infrastructure. We had a really important investment in a facility around heat management for vulnerable individuals, as well as a network of cooling centers. We made important progress, but we still have a lot of work to do.”
Housing Assistance and helping to get People off the Streets.
“The City of Phoenix just had a really great discussion about our Housing Trust Fund. The state was unable to fund theirs in the last budget, but the City of Phoenix stepped up and put in new funding on top of more than $50 million that our voters approved in the bond. We continue to work in that area and to make sure we pass policies to help people get the housing that they deserve. Earlier this month, we had several unanimous votes on new housing partnerships, including one with the Salvation Army, that’ll help us house more families. Unfortunately, this year, we did see an uptick in families that were threatened with homelessness, and so we are working with non-profits to have new partnerships in that area. A tougher issue, though the federal government has announced a lot of the funding we used to receive in the region, for vouchers to house formerly homeless people is no longer guaranteed, and they’re not interested as much in long-term housing funding, so that will be a huge impact on an issue of concern.”
Has the relationship with the current Administration gone about as you expected this year, or worse or better?
“We’ve had a very complicated relationship with the federal government. I personally am quite worried about the cuts to Medicaid, the top payer for our Phoenix Fire Department. I am worried that without health insurance, many individuals in our city won’t seek care until they’re incredibly sick. So, the fire department may be transporting more people who are sicker at a lower reimbursement rate. Our hospitals depend on Medicaid. It’s the top payment source for nurses in our community. Even our medical education system will be hurt by these changes. That’s something we are watching very closely.”
Are there any current policy goals that you introduced in prior sessions that you want to seek, continue, or expand?
“The City Council is very focused on housing. I think we will build on 2025 with policies related to eviction. We are hoping to work more closely with the state legislature on housing policy. The trust fund is just one of the steps, including mortgage assistance, that we’re trying to put forward to make housing more affordable, so that’ll be a real focus.”
“And data centers will continue to be a major focus. We’ll want to refine policies in that area. Right now, data center developers pay dramatically more than any other type of user in the city of Phoenix. So, we’re seeing land we had hoped would become housing turn into data centers. We’re seeing housing projects lose many units to transmission lines for data centers. We want to make sure we’re smart about policies in that area.”
“We’ve needed to update our fire code to make sure we keep our firefighters safe and that they have the tools to fight complex fires at data centers. We had a lithium battery fire in the West Valley that was deeply impactful on our firefighters, and then a data center fire in the East Valley, where we’ve learned a lot. We will be trying to move with best practices because we want to keep our First Responders and our community safe.”
What are the names of at least two new policy goals that you would like to advance in 2026?
“We are very focused on affordability. We’re hoping to continue to work to make sure housing is more affordable. I bought my first home in October 2008, so the single-month peak of the market in Phoenix, working so hard, and seeing my equity evaporate. The equity in the home was very impactful to me, so I want to make sure we do our part there.”
“Energy affordability is an increasing issue. Already, due to data centers and other costs, power bills are going up in Phoenix. We have limited say at the City in energy prices, but we’re going to try to do our part to help people access money to reduce weather-related power bills and to help people get into a place where they can afford their energy bills.”
You are also the chair of Climate Mayors. Is there anything you want to tie into those efforts in this response?
“Absolutely. I do serve as the chair of Climate Mayors, which is a group of more than 350 Mayors across the United States who work on climate change. We are very focused on energy, affordability, and making sure people can have clean energy. We are also seeing more data centers that want to put power plants right next to people’s homes with a high level of air quality emissions. We’re doing a lot of work to make sure power plants go in industrial areas and not right next to people’s homes. We also want to make sure people are educated about the energy efficiency incentives that are still left and find ways to reduce power usage and power bills.”
Is there anyone on your team you want to recognize for their hard work over the last year?
“I would like to recognize Willa Altman-Kaough. She serves as my Deputy Chief of Staff. She’s been our lead on sustainability policy and water. The Colorado River is a really important issue in our office, and she led that policy for me. My Chief of Staff, Seth Scott, welcomed a new baby this year. It’s very exciting for all of us, but particularly for his wife and for him. Willa stepped up to lead the office while he was on parental leave.”
Is there anything not covered in the first several questions that you would like the readers to know about what’s happened in the City of Phoenix over the last year or during your term?
“I am really proud that we’ve diversified the City of Phoenix economy and that young people have options from semiconductors to advanced health care jobs in the City of Phoenix. We also hope that means our residents have better health care and quality of life. One investment I was really proud to announce this year was ASU Health coming to downtown Phoenix. It will include a strong Public Health Program, Nursing School, and Medical School. Our City of Phoenix voters are helping support that through general obligation bonds. The medical school wants to improve health outcomes for all, including our most vulnerable. We’re very hopeful they can help us with some challenges we’ve had around chronic pain. So many of the people experiencing homelessness in Phoenix-their challenge began with a medical bill or chronic pain that may have led to addiction. We think the medical school will be a really key partner in being smarter about how we address this issue.”
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