House Engrossed designation; assured water supply; offset State of Arizona House of Representatives Fifty-seventh Legislature First Regular Session 2025 HOUSE BILL 2297 AN ACT amending title 45, chapter 2, article 9, Arizona Revised Statutes, by adding section 45-576.11; RELATING to groundwater management. (TEXT OF BILL BEGINS ON NEXT PAGE)
House Engrossed designation; assured water supply; offset
State of Arizona House of Representatives Fifty-seventh Legislature First Regular Session 2025
HOUSE BILL 2297
House Engrossed
designation; assured water supply; offset
State of Arizona
House of Representatives
Fifty-seventh Legislature
First Regular Session
2025
HOUSE BILL 2297
AN ACT
amending title 45, chapter 2, article 9, Arizona Revised Statutes, by adding section 45-576.11; RELATING to groundwater management.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona: Section 1. Title 45, chapter 2, article 9, Arizona Revised Statutes, is amended by adding section 45-576.11, to read: START_STATUTE45-576.11. Alterative designation of assured water supply; groundwater offset; groundwater allowance; calculation; definitions A. For a new application for a designation of assured water supply in an active management area, the director shall deem a volume of groundwater and stored water recovered outside of the area of impact as physically available if the director determines that a new alternative water supply included in the application complies with this section. The director shall calculate the volume of groundwater and stored water recovered outside of the area of impact as follows: 1. Add the total volume of groundwater withdrawn and stored water recovered outside of the area of impact within the service area of the applicant during the 2023 calendar year to the estimated groundwater and stored water recovered outside of the area of impact demand for unbuilt portions of issued certificates of assured water supply as of 2023 that are or will be within the service area of the applicant and multiply the sum by one hundred. 2. Multiply five percent of each new alternative water supply included in the designation by one hundred. 3. Subtract the total volume calculated in paragraph 2 of this subsection from the total volume calculated in paragraph 1 of this subsection. 4. For the purposes of calculation, the director shall use the annual report submitted by the municipal provider for calendar year 2023, as verified by the director. B. For an application that seeks to modify a designation of assured water supply and that includes a volume of groundwater and stored water recovered outside of the area of impact pursuant to subsection A of this section, the following apply: 1. The one hundred-year volume calculated pursuant to subsection A of this section shall be reduced by the volume of groundwater withdrawn and stored water recovered outside of the area of impact by the applicant since the issuance of a previous designation order. 2. The one hundred-year volume calculated pursuant to subsection A of this section shall be further reduced by five percent of the one hundred-year volume of each new alternative water supply included in any modified designation but not included in the previous designation. C. The director may not include any additional sources of groundwater withdrawn from an active management area or stored water recovered outside of the area of impact in an active management area in a designation of assured water supply that includes a volume of groundwater and stored water recovered outside of the area of impact pursuant to subsection A or B of this section. D. A designation granted pursuant to this section shall be for an initial term of not more than fifteen years. E. During the term of the designation, a designated provider may request an expedited modification of the designation to include additional water supplies that do not include groundwater or stored water recovered outside of the area of impact from an active management area. The director shall review only the following for an expedited modification under this subsection: 1. The proposed current, committed and projected demands under the current term of the designation. 2. The assured water supply requirements for the additional water supply. F. The director shall determine that an applicant for a designation has the financial capability to construct adequate delivery, storage and treatment works if the applicant demonstrates one or more of the following for each of those facilities: 1. The applicant has constructed adequate delivery, storage and treatment works. 2. The applicant has entered into written agreements requiring that a potential developer construct adequate delivery, storage and treatment works. 3. The applicant has submitted evidence demonstrating that financing mechanisms are in place to construct adequate delivery, storage and treatment works in a timely manner. 4. If the applicant is a city or town, the applicant has adopted a five-year capital improvement plan that provides for the construction or the commencement of construction of adequate delivery, storage and treatment works in a timely manner and has submitted a certification by the applicant's chief financial officer that finances are available to implement that portion of the five-year plan. 5. If the applicant is a private water company, the applicant has received approval from the corporation commission for financing the construction of adequate delivery, storage and treatment works. G. For a designation issued pursuant to this section, an applicant may only apply extinguishment credits delivered to the subdivision subject to the application. H. If an application for a designation includes a volume of groundwater or stored water recovered outside of the area of impact, the groundwater allowance shall be calculated by multiplying thirty by the applicant's total groundwater deliveries during the 2023 calendar year. For the purposes of this calculation, the director shall use the annual report submitted by a municipal provider for the 2023 calendar year. I. For the purposes of this section: 1. "Area of impact" means, as projected on the land surface, the area where the stored water has migrated or is located. 2. "Assured water supply" has the same meaning prescribed in section 45-576. 3. "Designation" means a designation of assured water supply. 4. "New alternative water supply": (a) Means a volume of water that is not groundwater withdrawn from an active management area and that was not served within the service area of the municipal provider in the 2023 calendar year per the annual report submitted by the municipal provider for the 2023 calendar year. (b) Does not include effluent. 5. "Stored water" has the same meaning prescribed in section 45-802.01. END_STATUTE Sec. 2. Requirements for enactment; two-thirds vote Pursuant to article IX, section 22, Constitution of Arizona, this act is effective only on the affirmative vote of at least two-thirds of the members of each house of the legislature and is effective immediately on the signature of the governor or, if the governor vetoes this act, on the subsequent affirmative vote of at least three-fourths of the members of each house of the legislature. Sec. 3. Emergency This act is an emergency measure that is necessary to preserve the public peace, health or safety and is operative immediately as provided by law.
Be it enacted by the Legislature of the State of Arizona:
Section 1. Title 45, chapter 2, article 9, Arizona Revised Statutes, is amended by adding section 45-576.11, to read:
START_STATUTE45-576.11. Alterative designation of assured water supply; groundwater offset; groundwater allowance; calculation; definitions
A. For a new application for a designation of assured water supply in an active management area, the director shall deem a volume of groundwater and stored water recovered outside of the area of impact as physically available if the director determines that a new alternative water supply included in the application complies with this section. The director shall calculate the volume of groundwater and stored water recovered outside of the area of impact as follows:
1. Add the total volume of groundwater withdrawn and stored water recovered outside of the area of impact within the service area of the applicant during the 2023 calendar year to the estimated groundwater and stored water recovered outside of the area of impact demand for unbuilt portions of issued certificates of assured water supply as of 2023 that are or will be within the service area of the applicant and multiply the sum by one hundred.
2. Multiply five percent of each new alternative water supply included in the designation by one hundred.
3. Subtract the total volume calculated in paragraph 2 of this subsection from the total volume calculated in paragraph 1 of this subsection.
4. For the purposes of calculation, the director shall use the annual report submitted by the municipal provider for calendar year 2023, as verified by the director.
B. For an application that seeks to modify a designation of assured water supply and that includes a volume of groundwater and stored water recovered outside of the area of impact pursuant to subsection A of this section, the following apply:
1. The one hundred-year volume calculated pursuant to subsection A of this section shall be reduced by the volume of groundwater withdrawn and stored water recovered outside of the area of impact by the applicant since the issuance of a previous designation order.
2. The one hundred-year volume calculated pursuant to subsection A of this section shall be further reduced by five percent of the one hundred-year volume of each new alternative water supply included in any modified designation but not included in the previous designation.
C. The director may not include any additional sources of groundwater withdrawn from an active management area or stored water recovered outside of the area of impact in an active management area in a designation of assured water supply that includes a volume of groundwater and stored water recovered outside of the area of impact pursuant to subsection A or B of this section.
D. A designation granted pursuant to this section shall be for an initial term of not more than fifteen years.
E. During the term of the designation, a designated provider may request an expedited modification of the designation to include additional water supplies that do not include groundwater or stored water recovered outside of the area of impact from an active management area. The director shall review only the following for an expedited modification under this subsection:
1. The proposed current, committed and projected demands under the current term of the designation.
2. The assured water supply requirements for the additional water supply.
F. The director shall determine that an applicant for a designation has the financial capability to construct adequate delivery, storage and treatment works if the applicant demonstrates one or more of the following for each of those facilities:
1. The applicant has constructed adequate delivery, storage and treatment works.
2. The applicant has entered into written agreements requiring that a potential developer construct adequate delivery, storage and treatment works.
3. The applicant has submitted evidence demonstrating that financing mechanisms are in place to construct adequate delivery, storage and treatment works in a timely manner.
4. If the applicant is a city or town, the applicant has adopted a five-year capital improvement plan that provides for the construction or the commencement of construction of adequate delivery, storage and treatment works in a timely manner and has submitted a certification by the applicant's chief financial officer that finances are available to implement that portion of the five-year plan.
5. If the applicant is a private water company, the applicant has received approval from the corporation commission for financing the construction of adequate delivery, storage and treatment works.
G. For a designation issued pursuant to this section, an applicant may only apply extinguishment credits delivered to the subdivision subject to the application.
H. If an application for a designation includes a volume of groundwater or stored water recovered outside of the area of impact, the groundwater allowance shall be calculated by multiplying thirty by the applicant's total groundwater deliveries during the 2023 calendar year. For the purposes of this calculation, the director shall use the annual report submitted by a municipal provider for the 2023 calendar year.
I. For the purposes of this section:
1. "Area of impact" means, as projected on the land surface, the area where the stored water has migrated or is located.
2. "Assured water supply" has the same meaning prescribed in section 45-576.
3. "Designation" means a designation of assured water supply.
4. "New alternative water supply":
(a) Means a volume of water that is not groundwater withdrawn from an active management area and that was not served within the service area of the municipal provider in the 2023 calendar year per the annual report submitted by the municipal provider for the 2023 calendar year.
(b) Does not include effluent.
5. "Stored water" has the same meaning prescribed in section 45-802.01. END_STATUTE
Sec. 2. Requirements for enactment; two-thirds vote
Pursuant to article IX, section 22, Constitution of Arizona, this act is effective only on the affirmative vote of at least two-thirds of the members of each house of the legislature and is effective immediately on the signature of the governor or, if the governor vetoes this act, on the subsequent affirmative vote of at least three-fourths of the members of each house of the legislature.
Sec. 3. Emergency
This act is an emergency measure that is necessary to preserve the public peace, health or safety and is operative immediately as provided by law.