CORRECTED Jan 17 2025 REFERENCE TITLE: basin-fill aquifers; groundwater; correlative rights State of Arizona House of Representatives Fifty-seventh Legislature First Regular Session 2025 HB 2415 Introduced by Representative Kolodin An Act amending section 45-454, Arizona Revised Statutes; amending title 45, chapter 2, Arizona Revised Statutes, by adding article 6.1; relating to the groundwater code. (TEXT OF BILL BEGINS ON NEXT PAGE)
CORRECTED Jan 17 2025
REFERENCE TITLE: basin-fill aquifers; groundwater; correlative rights
State of Arizona House of Representatives Fifty-seventh Legislature First Regular Session 2025
HB 2415
Introduced by Representative Kolodin
REFERENCE TITLE: basin-fill aquifers; groundwater; correlative rights
State of Arizona
House of Representatives
Fifty-seventh Legislature
First Regular Session
2025
HB 2415
Introduced by
Representative Kolodin
An Act
amending section 45-454, Arizona Revised Statutes; amending title 45, chapter 2, Arizona Revised Statutes, by adding article 6.1; relating to the groundwater code.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona: Section 1. Section 45-454, Arizona Revised Statutes, is amended to read: START_STATUTE45-454. Exemption of small non-irrigation wells; definitions A. Withdrawals of groundwater for non-irrigation uses from wells having a pump with a maximum capacity of not more than thirty-five gallons per minute which that were drilled before April 28, 1983 or which that were drilled after April 28, 1983 pursuant to a notice of intention to drill which that was on file with the department on such date are exempt from this chapter, except that: 1. Wells drilled before June 12, 1980 which that are not abandoned or capped or wells which that were not completed on June 12, 1980 but for which a notice of intention to drill was on file with the Arizona water commission on such date are subject to subsections J, K and L of this section and must be registered pursuant to section 45-593. If two or more wells in an active management area are exempt under this paragraph and are used to serve the same non-irrigation use at the same location, the aggregate quantity of groundwater withdrawn from the wells shall not exceed fifty-six acre-feet per year. 2. Wells drilled between June 12, 1980 and April 28, 1983, except as provided in paragraph 1 of this subsection, and wells drilled after April 28, 1983 pursuant to a notice of intention to drill which that was on file with the department on April 28, 1983, are subject to subsections G, I, J and K of this section. 3. Wells in a basin or subbasin with correlative rights are subject to the BENEFIT use requirements prescribed in article 6.1 of this chapter. B. Withdrawals of groundwater for non-irrigation uses from wells having a pump with a maximum capacity of not more than thirty-five gallons per minute drilled on or after April 28, 1983, except wells drilled after April 28, 1983 pursuant to a notice of intention to drill which that was on file with the department on such date, are exempt from this chapter, except that: 1. Such wells are subject to subsections G through K of this section. 2. In an active management area, other than a subsequent active management area designated for a portion of a groundwater basin in the regional aquifer systems of northern Arizona, withdrawals of groundwater from such wells for non-irrigation uses other than domestic purposes and stock watering shall not exceed ten acre-feet per year. 3. In a subsequent active management area that is designated for a portion of a groundwater basin in the regional aquifer systems of northern Arizona, groundwater withdrawn from such wells may be used only for domestic purposes and stock watering. C. On or after January 1, 2006, an exempt well otherwise allowed by this section may not be drilled on land if any part of the land is within one hundred feet of the operating water distribution system of a municipal provider with an assured water supply designation within the boundaries of an active management area established on or before July 1, 1994, as shown on a digitized service area map provided to the director by the municipal provider and updated by the municipal provider as specified by the director. D. On request from the owner of the land on which an exempt well is prohibited pursuant to subsection C of this section on a form prescribed by the director, the director shall issue an exemption from subsection C of this section if the landowner demonstrates to the satisfaction of the director that any of the following applies: 1. The landowner submitted a written request for service to the municipal provider that operates the distribution system and the municipal provider did not provide written verification to the landowner within thirty calendar days after receipt of receiving the request that water service is available to the landowner after payment of any applicable fee to the municipal provider. 2. The total capital cost and fees for connecting to the operating water distribution system exceed the total capital cost and fees for drilling and fully equipping an exempt well. 3. If the applicant must obtain an easement across other land to connect to the water distribution system of the municipal provider, the applicant sent the owner of the land a request for the easement by certified mail, return receipt requested, and either the applicant did not receive a response to the request within thirty calendar days of mailing the request or the request was denied. 4. The landowner does not qualify for an exemption pursuant to paragraph 1, 2 or 3 of this subsection and the landowner provides written verification from the municipal provider that the landowner shall not receive or request water service from the municipal provider while the exempt well is operational. The exemption for that well is revoked if the landowner or any subsequent landowner receives water service from the municipal provider. In determining whether to approve or reject a permit application filed under section 45-599, the director shall not consider any impacts the proposed well may have on an exempt well drilled pursuant to this paragraph. E. This section does not prohibit a property owner, after January 1, 2006, from drilling a replacement exempt well for a lawful exempt well if the replacement well does not increase the total number of operable exempt wells on the applicant's land. F. A remediation well drilled for the purpose of remediating groundwater is exempt from this section if it meets one of the following: 1. The remediation well is for an approved department of environmental quality or United States environmental protection agency remediation program. 2. A registered geologist certifies that the remediation well is for the purpose of remediation. G. A person shall file a notice of intention to drill with the director pursuant to section 45-596 before drilling an exempt well or causing an exempt well to be drilled. H. The registered well owner shall file a completion report pursuant to section 45-600, subsection B. I. In an active management area only one exempt well may be drilled or used to serve the same non-irrigation use at the same location, except that a person may drill or use a second exempt well to serve the same non-irrigation use at the same location if the director determines that all of the following apply: 1. Because of its location, the first exempt well is not capable of consistently producing more than three gallons per minute of groundwater when equipped with a pump with a maximum capacity of thirty-five gallons per minute. 2. The second exempt well is located on the same parcel of land as the first exempt well, the parcel of land is at least one acre in size, all groundwater withdrawn from both exempt wells is used on that parcel of land and there are no other exempt wells on that parcel of land. 3. Combined withdrawals from both wells do not exceed five acre-feet per year. 4. If the second exempt well is drilled after January 1, 2000, the county health authority for the county in which the well is located or any other local health authority that controls the installation of septic tanks or sewer systems in the county has approved the location of the well in writing after physically inspecting the well site. 5. Use of two wells for the same non-irrigation use at the same location is not contrary to the health and welfare of the public. J. An exempt well is subject to sections 45-594 and 45-595. K. Groundwater withdrawn from an exempt well may be transported only pursuant to articles 8 and 8.1 of this chapter. L. A person who owns land from which exempt withdrawals were being made as of the date of the designation of the active management area is not eligible for a certificate of grandfathered right for a type 2 non-irrigation use for such withdrawals. M. For the purposes of this section: 1. "Domestic purposes" means uses related to the supply, service and activities of households and private residences and includes the application of water to less than two acres of land to produce plants or parts of plants for sale or human consumption, or for use as feed for livestock, range livestock or poultry, as such terms are defined in section 3-1201. 2. "Municipal provider" means a city, town, private water company or irrigation district that supplies water for non-irrigation use. 3. "Stock watering" means the watering of livestock, range livestock or poultry, as such terms are defined in section 3-1201. END_STATUTE Sec. 2. Title 45, chapter 2, Arizona Revised Statutes, is amended by adding article 6.1, to read: ARTICLE 6.1. CORRELATIVE RIGHTS TO GROUNDWATER START_STATUTE45-501. Correlative rights to groundwater; establishment; eligible basins; legislative intent A. The director may establish correlative rights in a groundwater basin or subbasin that meet all of the following conditions: 1. The groundwater basin or subbasin is not in an initial active management area that contains any portion of the central Arizona project aqueduct. 2. The groundwater basin or subbasin is an alluvial-fill basin. For the purposes of this paragraph, a fractured rock aquifer or regional plateau-based aquifer is not an alluvial-fill basin. B. The director may establish correlative rights in an eligible basin or subbasin on entering a written finding that any of the following is true: 1. The eligible basin or subbasin meets the qualifications for designation as a subsequent active management area pursuant to section 45-412 or subsequent irrigation non-expansion area pursuant to section 45-432 and the director determines that providing an alternative tool for managing groundwater is reasonable and appropriate in the eligible basin or subbasin. 2. The eligible basin or subbasin is an active management area with a management goal of safe yield by January 1, 2025 and the director determines that the management goal has not been met or will not be met based on the current rate of withdrawal. 3. A person may transport groundwater from the basin or subbasin to another basin or subbasin pursuant to article 8.1 of this chapter. 4. Within the last twenty-four months, the owners of fifty-one percent of surface acreage of private land in the eligible basin or subbasin and fifty-one percent of the owners of private land in the eligible basin or subbasin have submitted to the director written support for establishing correlative rights to groundwater in the basin or subbasin. C. The director shall establish correlative rights in an eligible area if establishing correlative rights in the basin or subbasin is approved by a majority of eligible voters in a basin or subbasin that meets one of the conditions prescribed by this section. D. A person who is a registered voter and has owned land in and been a resident of the eligible basin or subbasin for each of the last five years may file a petition with the director and all county boards of supervisors and recorders where the groundwater basin or subbasin is located. The petition shall be signed by at least ten percent of the registered voters who reside within the boundaries of the groundwater basin or subbasin specified in the petition as of the most recent report compiled by the relevant county recorders in compliance with section 16-168, subsection H. E. The form of the petition prescribed by subsection D of this section shall be substantially similar to an initiative petition, and the applicant for the petition shall comply with section 19-111, subsections A, B and E, except that the duties required of the secretary of state shall be performed by the county recorders of the counties in which the registered voters of the groundwater basin or subbasin reside. The director and any county official may not accept a petition more than one hundred eighty days after a person applies for a petition with the relevant county recorders. F. On request of a county recorder, the director shall transmit to the county recorder any factual data concerning the boundaries of the eligible basin or subbasin that may aid the county recorder in determining which registered voters of the county are residents and are eligible voters of the eligible basin or subbasin. The transmitted data shall include a map of the residences in the eligible basin or subbasin and any factual data concerning the ownership of land in the eligible basin or subbasin that may aid the county recorder in determining which registered voters of the county are landowners in the eligible basin or subbasin and are eligible signatories for the petition. G. On the valid submission of the requisite signatures, the county boards of supervisors for each county that contains a portion of the eligible basin or subbasin shall cooperate to include on the next general election ballot for all registered voters who reside in the eligible basin or subbasin a question of whether to establish correlative rights in the eligible basin or subbasin. The ballot shall be worded, "should correlative rights to groundwater be established in (name of eligible basin or subbasin)?" followed by the words "yes" and "no". H. Within thirty days after the director issues written findings pursuant to subsection b of this section or the general election results are certified pursuant to this section, the director shall make and file an order establishing correlative rights in the basin or subbasin and file a true map of the relevant basin or subbasin in the office of the county recorder of the county or counties that contain a portion of the relevant basin or subbasin. I. It is the intent of the legislature that the establishment of correlative rights is to protect public health and safety and not to directly regulate an owner's land. END_STATUTE START_STATUTE45-502. Correlative rights; calculation; allocation; definition A. Within ninety days after correlative rights are established in an eligible basin or subbasin the director shall do all of the following: 1. Determine the total surface area of eligible acres in the relevant basin or subbasin. For the purposes of this paragraph, the director shall round all partial acres to the nearest acre. 2. Determine the total volume of groundwater available in the relevant basin or subbasin to the maximum depth of bedrock at all points in the relevant basin or subbasin. For the purposes of this paragraph, the director shall round to the nearest acre-foot. 3. Determine the average total volume of annual natural recharge in the relevant basin or subbasin over the preceding thirty years. For the purposes of this paragraph, the director shall round to the nearest acre-foot per year. 4. Determine each eligible acre's proportional share of the total surface area determined pursuant to paragraph 1 of this subsection by dividing the number one by the total surface area determined pursuant to paragraph 1 of this subsection. 5. Determine each eligible acre's proportional share of the total volume of groundwater available in the relevant basin or subbasin determined pursuant to paragraph 2 of this subsection by multiplying the total surface area determined pursuant to paragraph 1 of this subsection by the proportional share determined pursuant to paragraph 4 of this subsection. 6. Determine each eligible acre's proportional share of the average total annual natural recharge determined pursuant to paragraph 3 of this subsection by multiplying each acre's proportional share of the total surface area determined pursuant to paragraph 4 of this subsection by the average total volume of annual natural recharge determined pursuant to paragraph 3 of this subsection. 7. Identify each tax parcel in the relevant basin or subbasin that contains a portion of eligible acres and determine the total number of eligible acres located within each tax parcel. 8. Determine each tax parcel's total proportional share of the total surface area determined pursuant to paragraph 1 of this subsection by dividing the total number of eligible acres located within each tax parcel determined pursuant to paragraph 7 of this subsection by the total surface area determined pursuant to paragraph 1 of this subsection. 9. Determine each tax parcel's total correlative right to groundwater in the relevant basin or subbasin by multiplying each tax parcel's total proportional share determined pursuant to paragraph 8 of this subsection by the total volume of groundwater determined pursuant to paragraph 5 of this subsection. 10. Determine each tax parcel's total correlative right to annual natural recharge in the relevant basin or subbasin by multiplying the tax parcel's total proportional share determined pursuant to paragraph 8 of this subsection by the average total volume of annual natural recharge determined pursuant to paragraph 3 of this subsection. 11. Assign a personal groundwater account to the owner of each tax parcel identified pursuant to paragraph 7 of this subsection. 12. Allocate to each personal groundwater account a lump sum volume of groundwater that is equal to the tax parcel's correlative right to groundwater calculated pursuant to paragraph 9 of this subsection. B. Each year after completing the requirements of subsection A of this section, the director shall allocate to each personal groundwater account a credit equal to the tax parcel's correlative right to annual natural recharge calculated pursuant to subsection A, paragraph 10 of this section. C. For the purposes of this section, "eligible acres" means land constituting the surface area of alluvium fill that composes the relevant basin or subbasin.END_STATUTE START_STATUTE45-503. Basin or subbasin closure; administration; personal groundwater accounts A. Beginning ninety days after correlative rights are established in an eligible basin or subbasin, groundwater pumping may not occur except that a person to whom the director has assigned a personal groundwater account pursuant to section 45-502 may withdraw or use groundwater from the relevant basin or subbasin subject to the following conditions: 1. The person may withdraw and use groundwater only in a reasonable and beneficial manner as prescribed by law. 2. The person may withdraw and use groundwater only in a manner that is consistent with the correlative rights of other landowners in the relevant basin or subbasin. 3. The person may not withdraw groundwater from the relevant basin or subbasin if the total volume of groundwater that is available in the person's personal groundwater account is zero. 4. The person may not withdraw more groundwater from the relevant basin or subbasin than the person can put to reasonable and beneficial use at a time or location within the relevant basin or subbasin. 5. The person may not withdraw groundwater from the relevant basin or subbasin in a manner, rate or proximity to another landowner in the relevant basin or subbasin that infringes on or causes damage to the property or rights of another landowner in the relevant basin or subbasin. 6. The person may conserve, preserve or otherwise not withdraw as much groundwater as the person has available in the person's personal groundwater account for as long as the person is assigned the personal groundwater account. 7. The person may trade, transfer, convey, sell or purchase groundwater credits or personal groundwater accounts and their associated correlative rights with any other personal groundwater account holder in the relevant basin or subbasin. A person that conveys credits shall provide written notice to the director, on a form provided by the director, within a reasonable time frame established by the director. The director may not require a person to obtain a permit or other form of approval for any transfer or conveyance. 8. The person may not appropriate subflow or surface water out of priority. 9. The person is not required to own or operate a well to exercise the person's correlative rights. The person may receive groundwater pursuant to the person's correlative rights from a well that is owned or operated by another personal groundwater account holder in the relevant basin or subbasin. 10. The person who owns or operates a well in the relevant basin or subbasin that is used to withdraw groundwater for another personal groundwater account holder is responsible for ensuring that the director properly debits any withdrawals made from such well to the correct personal groundwater account. 11. The person is responsible for exercising the person's correlative right for maintaining the person's ability to use, access and withdraw the groundwater associated with the person's right in the relevant basin or subbasin. B. A landowner who owns one or more tax parcels identified pursuant to section 45-502, subsection a, paragraph 7 may apply to the director, on a form provided by the director, to claim ownership of and consolidate any personal groundwater accounts and associated correlative rights that correspond to the tax parcels and may request that the director assign the personal groundwater accounts and associated correlative rights to the landowner in a consolidated account. C. An owner or operator of a community water system, municipal water system or other water distribution system that provides water service to one or more tax parcels identified pursuant to section 45-502, subsection a, paragraph 7 may apply to the director, on a form provided by the director, to claim ownership of any personal groundwater accounts and associated correlative rights that correspond to tax parcels that the owner or operator serves and may request that the director assign the personal groundwater accounts and associated correlative rights to the owner or operator, which shall be in the name of the water provider, in a single consolidated groundwater account. D. Notwithstanding subsection b of this section, a landowner may not claim personal groundwater accounts or associated correlative rights that correspond to any tax parcels that are located within the distribution service area of an entity described in subsection C of this section. E. The director shall establish an application process to credit an owner of an active or passive groundwater recharge facility located within a relevant basin or subbasin the difference between the owner's correlative right to annual natural recharge and the increase in annual natural recharge caused by the owner's recharge facility, as confirmed by the director. If multiple persons own an active or passive groundwater replenishment or recharge facility, the director shall award the additional credit to each owner's personal groundwater account in proportion to the ownership of a facility or as contracted among the parties. F. Within ninety days after correlative rights are established in an eligible basin or subbasin, the director shall adopt rules to implement this section, including rules to: 1. Establish an application process for the assignment, reassignment and consolidation of personal groundwater accounts in a relevant basin or subbasin. 2. Establish a process for notifying the director of trades, transfers, conveyances, sales and purchases of groundwater credits or personal groundwater accounts and their associated correlative rights. 3. Enforce this section, including reasonable reporting requirements, measuring or monitoring requirements, well spacing requirements and well impact tests. G. This article does not establish a right to have this state or any political subdivision of this state provide, guarantee access to or otherwise ensure a person's ability to access, use or withdraw groundwater from a relevant basin or subbasin. END_STATUTE START_STATUTE45-504. Groundwater transportation; beneficial use; damages; exemption A. Notwithstanding section 45-544, in an eligible basin or subbasin where correlative rights have been established: 1. Groundwater may be transported freely within the relevant basin or subbasin and is not appurtenant to the land, well or other location from which the groundwater was withdrawn or transported. 2. Groundwater may be transferred or conveyed separately from any parcel of land located within the relevant basin or subbasin. 3. Groundwater transfers and conveyances within a relevant basin or subbasin pursuant to this article constitute putting groundwater to a reasonable and beneficial use. 4. Groundwater that is transported within the relevant basin or subbasin is not subject to any claim for damages except an account holder may seek damages from a person that infringes or causes damage to the property or rights of the account holder. A person is not entitled to damages or other relief if the account holder has not suffered actual harm to the account holder's personal groundwater account, property or correlative rights. For the purposes of this paragraph: (a) A decline in depth to water levels alone is insufficient to prove actual harm. (b) A localized decline in depth to water levels that results from a cone of depression and that is found to be in violation of rules adopted by the director is sufficient to prove actual harm. B. A landowner who owns one or more tax parcels identified pursuant to section 45-502 and who withdraws groundwater from not more than one exempt well in the relevant basin or subbasin may submit a notice to the director, on a form provided by the director, that exempts the owner from section 45-503 and rules adopted pursuant to that section except those concerning beneficial use. C. Notwithstanding any other provision of this article, if the department receives a notice pursuant to subsection B of this section: 1. The exempt landowner is not entitled to claim a personal groundwater account or receive a correlative groundwater right. 2. The exempt landowner is not entitled to receive the damages, protection or benefits that are provided to owners of personal groundwater accounts. 3. The department shall subtract from the total surface area of eligible acres calculated pursuant to section 45-502, subsection a, paragraph 1 the eligible acres that are located within the tax parcels associated with the exempt landowner and shall allocate to all other eligible acres in the relevant basin or subbasin the correlative rights to groundwater and correlative rights to annual natural recharge that otherwise would have been allocated to the exempt landowner's eligible acres. D. An exempt landowner may revoke the exempt landowner's exemption by submitting an application to the director, on a form provided by the director, requesting that the director revoke the landowner's exemption and establish a personal groundwater account. The application shall include evidence demonstrating that the exempt landowner has acquired from other personal groundwater account holders in the relevant basin or subbasin a volume of groundwater credits that is at least equal to the volume of correlative rights that the director otherwise would have allocated to the exempt landowner pursuant to subsection C, paragraph 3 of this section. Any groundwater that the exempt landowner withdrew from the relevant basin or subbasin between the effective date of this section and the effective date of the landowner's personal groundwater account shall be debited from the landowner's personal groundwater account on the effective date of the landowner's personal groundwater account. END_STATUTE START_STATUTE45-505. Rights subject to appropriation; subflow; surface water; effect on adjudication For the purposes of this article, a person may not appropriate subflow or surface water out of priority. This article does not exempt subflow or surface water from a general stream adjudication. END_STATUTE START_STATUTE45-506. Ten-year review; report; audit; recalculation of correlative rights A. On the tenth anniversary of establishing correlative rights in an eligible basin or subbasin and every ten years thereafter, the director shall complete an updated hydrological review of the relevant basin or subbasin to reassess each of the following: 1. The total volume of groundwater available to the maximum depth of bedrock at all points in the relevant basin or subbasin. 2. The average total volume of annual natural recharge over the preceding thirty years in the relevant basin or subbasin. B. On completing the updated hydrological review prescribed by subsection a of this section, the director shall audit each personal groundwater account in the relevant basin or subbasin and do all of the following: 1. Adjust each personal groundwater account to reflect updates, errors or corrections in reporting, metering, measuring or monitoring groundwater withdrawals, account credit transfers or recharge. 2. Reassign to each personal groundwater account in the relevant basin or subbasin an updated lump sum volume of groundwater associated with the personal groundwater account holder's correlative right to groundwater, minus the total volume of groundwater withdrawn or debited from the account in each of the last ten years, plus the total volume of groundwater credited to the account in each of the last ten years. 3. Reassign to each personal groundwater account in the relevant basin or subbasin an updated annual recharge credit associated with the personal groundwater account holder's correlative right to annual natural recharge. C. On completion of every ten year audit, the director shall submit a report regarding the audit and make recommendations for administrative or legislative action to the governor, the president of the senate and the speaker of the house of representatives and shall provide a copy of this report to the secretary of state. END_STATUTE Sec. 3. Correlative rights; statewide establishment; election A. On the effective date of this act, the secretary of state shall work to place a question on the statewide 2026 general election ballot as to whether the director of the department of water resources should establish correlative rights in all eligible basins and subbasins. B. All qualified electors who are registered to vote in this state are eligible to vote on the question prescribed by this section. The ballot shall state "Should correlative rights to groundwater, as defined by section 45-501, Arizona Revised Statutes, as added by this act, be established in all eligible basins and subbasins?" followed by the words "Yes" and "No". If a majority of those qualified electors voting on the question votes to approve the establishment of correlative rights to groundwater, the director shall immediately follow the procedures prescribed by this act.
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 45-454, Arizona Revised Statutes, is amended to read:
START_STATUTE45-454. Exemption of small non-irrigation wells; definitions
A. Withdrawals of groundwater for non-irrigation uses from wells having a pump with a maximum capacity of not more than thirty-five gallons per minute which that were drilled before April 28, 1983 or which that were drilled after April 28, 1983 pursuant to a notice of intention to drill which that was on file with the department on such date are exempt from this chapter, except that:
1. Wells drilled before June 12, 1980 which that are not abandoned or capped or wells which that were not completed on June 12, 1980 but for which a notice of intention to drill was on file with the Arizona water commission on such date are subject to subsections J, K and L of this section and must be registered pursuant to section 45-593. If two or more wells in an active management area are exempt under this paragraph and are used to serve the same non-irrigation use at the same location, the aggregate quantity of groundwater withdrawn from the wells shall not exceed fifty-six acre-feet per year.
2. Wells drilled between June 12, 1980 and April 28, 1983, except as provided in paragraph 1 of this subsection, and wells drilled after April 28, 1983 pursuant to a notice of intention to drill which that was on file with the department on April 28, 1983, are subject to subsections G, I, J and K of this section.
3. Wells in a basin or subbasin with correlative rights are subject to the BENEFIT use requirements prescribed in article 6.1 of this chapter.
B. Withdrawals of groundwater for non-irrigation uses from wells having a pump with a maximum capacity of not more than thirty-five gallons per minute drilled on or after April 28, 1983, except wells drilled after April 28, 1983 pursuant to a notice of intention to drill which that was on file with the department on such date, are exempt from this chapter, except that:
1. Such wells are subject to subsections G through K of this section.
2. In an active management area, other than a subsequent active management area designated for a portion of a groundwater basin in the regional aquifer systems of northern Arizona, withdrawals of groundwater from such wells for non-irrigation uses other than domestic purposes and stock watering shall not exceed ten acre-feet per year.
3. In a subsequent active management area that is designated for a portion of a groundwater basin in the regional aquifer systems of northern Arizona, groundwater withdrawn from such wells may be used only for domestic purposes and stock watering.
C. On or after January 1, 2006, an exempt well otherwise allowed by this section may not be drilled on land if any part of the land is within one hundred feet of the operating water distribution system of a municipal provider with an assured water supply designation within the boundaries of an active management area established on or before July 1, 1994, as shown on a digitized service area map provided to the director by the municipal provider and updated by the municipal provider as specified by the director.
D. On request from the owner of the land on which an exempt well is prohibited pursuant to subsection C of this section on a form prescribed by the director, the director shall issue an exemption from subsection C of this section if the landowner demonstrates to the satisfaction of the director that any of the following applies:
1. The landowner submitted a written request for service to the municipal provider that operates the distribution system and the municipal provider did not provide written verification to the landowner within thirty calendar days after receipt of receiving the request that water service is available to the landowner after payment of any applicable fee to the municipal provider.
2. The total capital cost and fees for connecting to the operating water distribution system exceed the total capital cost and fees for drilling and fully equipping an exempt well.
3. If the applicant must obtain an easement across other land to connect to the water distribution system of the municipal provider, the applicant sent the owner of the land a request for the easement by certified mail, return receipt requested, and either the applicant did not receive a response to the request within thirty calendar days of mailing the request or the request was denied.
4. The landowner does not qualify for an exemption pursuant to paragraph 1, 2 or 3 of this subsection and the landowner provides written verification from the municipal provider that the landowner shall not receive or request water service from the municipal provider while the exempt well is operational. The exemption for that well is revoked if the landowner or any subsequent landowner receives water service from the municipal provider. In determining whether to approve or reject a permit application filed under section 45-599, the director shall not consider any impacts the proposed well may have on an exempt well drilled pursuant to this paragraph.
E. This section does not prohibit a property owner, after January 1, 2006, from drilling a replacement exempt well for a lawful exempt well if the replacement well does not increase the total number of operable exempt wells on the applicant's land.
F. A remediation well drilled for the purpose of remediating groundwater is exempt from this section if it meets one of the following:
1. The remediation well is for an approved department of environmental quality or United States environmental protection agency remediation program.
2. A registered geologist certifies that the remediation well is for the purpose of remediation.
G. A person shall file a notice of intention to drill with the director pursuant to section 45-596 before drilling an exempt well or causing an exempt well to be drilled.
H. The registered well owner shall file a completion report pursuant to section 45-600, subsection B.
I. In an active management area only one exempt well may be drilled or used to serve the same non-irrigation use at the same location, except that a person may drill or use a second exempt well to serve the same non-irrigation use at the same location if the director determines that all of the following apply:
1. Because of its location, the first exempt well is not capable of consistently producing more than three gallons per minute of groundwater when equipped with a pump with a maximum capacity of thirty-five gallons per minute.
2. The second exempt well is located on the same parcel of land as the first exempt well, the parcel of land is at least one acre in size, all groundwater withdrawn from both exempt wells is used on that parcel of land and there are no other exempt wells on that parcel of land.
3. Combined withdrawals from both wells do not exceed five acre-feet per year.
4. If the second exempt well is drilled after January 1, 2000, the county health authority for the county in which the well is located or any other local health authority that controls the installation of septic tanks or sewer systems in the county has approved the location of the well in writing after physically inspecting the well site.
5. Use of two wells for the same non-irrigation use at the same location is not contrary to the health and welfare of the public.
J. An exempt well is subject to sections 45-594 and 45-595.
K. Groundwater withdrawn from an exempt well may be transported only pursuant to articles 8 and 8.1 of this chapter.
L. A person who owns land from which exempt withdrawals were being made as of the date of the designation of the active management area is not eligible for a certificate of grandfathered right for a type 2 non-irrigation use for such withdrawals.
M. For the purposes of this section:
1. "Domestic purposes" means uses related to the supply, service and activities of households and private residences and includes the application of water to less than two acres of land to produce plants or parts of plants for sale or human consumption, or for use as feed for livestock, range livestock or poultry, as such terms are defined in section 3-1201.
2. "Municipal provider" means a city, town, private water company or irrigation district that supplies water for non-irrigation use.
3. "Stock watering" means the watering of livestock, range livestock or poultry, as such terms are defined in section 3-1201. END_STATUTE
Sec. 2. Title 45, chapter 2, Arizona Revised Statutes, is amended by adding article 6.1, to read:
ARTICLE 6.1. CORRELATIVE RIGHTS TO GROUNDWATER
START_STATUTE45-501. Correlative rights to groundwater; establishment; eligible basins; legislative intent
A. The director may establish correlative rights in a groundwater basin or subbasin that meet all of the following conditions:
1. The groundwater basin or subbasin is not in an initial active management area that contains any portion of the central Arizona project aqueduct.
2. The groundwater basin or subbasin is an alluvial-fill basin. For the purposes of this paragraph, a fractured rock aquifer or regional plateau-based aquifer is not an alluvial-fill basin.
B. The director may establish correlative rights in an eligible basin or subbasin on entering a written finding that any of the following is true:
1. The eligible basin or subbasin meets the qualifications for designation as a subsequent active management area pursuant to section 45-412 or subsequent irrigation non-expansion area pursuant to section 45-432 and the director determines that providing an alternative tool for managing groundwater is reasonable and appropriate in the eligible basin or subbasin.
2. The eligible basin or subbasin is an active management area with a management goal of safe yield by January 1, 2025 and the director determines that the management goal has not been met or will not be met based on the current rate of withdrawal.
3. A person may transport groundwater from the basin or subbasin to another basin or subbasin pursuant to article 8.1 of this chapter.
4. Within the last twenty-four months, the owners of fifty-one percent of surface acreage of private land in the eligible basin or subbasin and fifty-one percent of the owners of private land in the eligible basin or subbasin have submitted to the director written support for establishing correlative rights to groundwater in the basin or subbasin.
C. The director shall establish correlative rights in an eligible area if establishing correlative rights in the basin or subbasin is approved by a majority of eligible voters in a basin or subbasin that meets one of the conditions prescribed by this section.
D. A person who is a registered voter and has owned land in and been a resident of the eligible basin or subbasin for each of the last five years may file a petition with the director and all county boards of supervisors and recorders where the groundwater basin or subbasin is located. The petition shall be signed by at least ten percent of the registered voters who reside within the boundaries of the groundwater basin or subbasin specified in the petition as of the most recent report compiled by the relevant county recorders in compliance with section 16-168, subsection H.
E. The form of the petition prescribed by subsection D of this section shall be substantially similar to an initiative petition, and the applicant for the petition shall comply with section 19-111, subsections A, B and E, except that the duties required of the secretary of state shall be performed by the county recorders of the counties in which the registered voters of the groundwater basin or subbasin reside. The director and any county official may not accept a petition more than one hundred eighty days after a person applies for a petition with the relevant county recorders.
F. On request of a county recorder, the director shall transmit to the county recorder any factual data concerning the boundaries of the eligible basin or subbasin that may aid the county recorder in determining which registered voters of the county are residents and are eligible voters of the eligible basin or subbasin. The transmitted data shall include a map of the residences in the eligible basin or subbasin and any factual data concerning the ownership of land in the eligible basin or subbasin that may aid the county recorder in determining which registered voters of the county are landowners in the eligible basin or subbasin and are eligible signatories for the petition.
G. On the valid submission of the requisite signatures, the county boards of supervisors for each county that contains a portion of the eligible basin or subbasin shall cooperate to include on the next general election ballot for all registered voters who reside in the eligible basin or subbasin a question of whether to establish correlative rights in the eligible basin or subbasin. The ballot shall be worded, "should correlative rights to groundwater be established in (name of eligible basin or subbasin)?" followed by the words "yes" and "no".
H. Within thirty days after the director issues written findings pursuant to subsection b of this section or the general election results are certified pursuant to this section, the director shall make and file an order establishing correlative rights in the basin or subbasin and file a true map of the relevant basin or subbasin in the office of the county recorder of the county or counties that contain a portion of the relevant basin or subbasin.
I. It is the intent of the legislature that the establishment of correlative rights is to protect public health and safety and not to directly regulate an owner's land. END_STATUTE
START_STATUTE45-502. Correlative rights; calculation; allocation; definition
A. Within ninety days after correlative rights are established in an eligible basin or subbasin the director shall do all of the following:
1. Determine the total surface area of eligible acres in the relevant basin or subbasin. For the purposes of this paragraph, the director shall round all partial acres to the nearest acre.
2. Determine the total volume of groundwater available in the relevant basin or subbasin to the maximum depth of bedrock at all points in the relevant basin or subbasin. For the purposes of this paragraph, the director shall round to the nearest acre-foot.
3. Determine the average total volume of annual natural recharge in the relevant basin or subbasin over the preceding thirty years. For the purposes of this paragraph, the director shall round to the nearest acre-foot per year.
4. Determine each eligible acre's proportional share of the total surface area determined pursuant to paragraph 1 of this subsection by dividing the number one by the total surface area determined pursuant to paragraph 1 of this subsection.
5. Determine each eligible acre's proportional share of the total volume of groundwater available in the relevant basin or subbasin determined pursuant to paragraph 2 of this subsection by multiplying the total surface area determined pursuant to paragraph 1 of this subsection by the proportional share determined pursuant to paragraph 4 of this subsection.
6. Determine each eligible acre's proportional share of the average total annual natural recharge determined pursuant to paragraph 3 of this subsection by multiplying each acre's proportional share of the total surface area determined pursuant to paragraph 4 of this subsection by the average total volume of annual natural recharge determined pursuant to paragraph 3 of this subsection.
7. Identify each tax parcel in the relevant basin or subbasin that contains a portion of eligible acres and determine the total number of eligible acres located within each tax parcel.
8. Determine each tax parcel's total proportional share of the total surface area determined pursuant to paragraph 1 of this subsection by dividing the total number of eligible acres located within each tax parcel determined pursuant to paragraph 7 of this subsection by the total surface area determined pursuant to paragraph 1 of this subsection.
9. Determine each tax parcel's total correlative right to groundwater in the relevant basin or subbasin by multiplying each tax parcel's total proportional share determined pursuant to paragraph 8 of this subsection by the total volume of groundwater determined pursuant to paragraph 5 of this subsection.
10. Determine each tax parcel's total correlative right to annual natural recharge in the relevant basin or subbasin by multiplying the tax parcel's total proportional share determined pursuant to paragraph 8 of this subsection by the average total volume of annual natural recharge determined pursuant to paragraph 3 of this subsection.
11. Assign a personal groundwater account to the owner of each tax parcel identified pursuant to paragraph 7 of this subsection.
12. Allocate to each personal groundwater account a lump sum volume of groundwater that is equal to the tax parcel's correlative right to groundwater calculated pursuant to paragraph 9 of this subsection.
B. Each year after completing the requirements of subsection A of this section, the director shall allocate to each personal groundwater account a credit equal to the tax parcel's correlative right to annual natural recharge calculated pursuant to subsection A, paragraph 10 of this section.
C. For the purposes of this section, "eligible acres" means land constituting the surface area of alluvium fill that composes the relevant basin or subbasin.END_STATUTE
START_STATUTE45-503. Basin or subbasin closure; administration; personal groundwater accounts
A. Beginning ninety days after correlative rights are established in an eligible basin or subbasin, groundwater pumping may not occur except that a person to whom the director has assigned a personal groundwater account pursuant to section 45-502 may withdraw or use groundwater from the relevant basin or subbasin subject to the following conditions:
1. The person may withdraw and use groundwater only in a reasonable and beneficial manner as prescribed by law.
2. The person may withdraw and use groundwater only in a manner that is consistent with the correlative rights of other landowners in the relevant basin or subbasin.
3. The person may not withdraw groundwater from the relevant basin or subbasin if the total volume of groundwater that is available in the person's personal groundwater account is zero.
4. The person may not withdraw more groundwater from the relevant basin or subbasin than the person can put to reasonable and beneficial use at a time or location within the relevant basin or subbasin.
5. The person may not withdraw groundwater from the relevant basin or subbasin in a manner, rate or proximity to another landowner in the relevant basin or subbasin that infringes on or causes damage to the property or rights of another landowner in the relevant basin or subbasin.
6. The person may conserve, preserve or otherwise not withdraw as much groundwater as the person has available in the person's personal groundwater account for as long as the person is assigned the personal groundwater account.
7. The person may trade, transfer, convey, sell or purchase groundwater credits or personal groundwater accounts and their associated correlative rights with any other personal groundwater account holder in the relevant basin or subbasin. A person that conveys credits shall provide written notice to the director, on a form provided by the director, within a reasonable time frame established by the director. The director may not require a person to obtain a permit or other form of approval for any transfer or conveyance.
8. The person may not appropriate subflow or surface water out of priority.
9. The person is not required to own or operate a well to exercise the person's correlative rights. The person may receive groundwater pursuant to the person's correlative rights from a well that is owned or operated by another personal groundwater account holder in the relevant basin or subbasin.
10. The person who owns or operates a well in the relevant basin or subbasin that is used to withdraw groundwater for another personal groundwater account holder is responsible for ensuring that the director properly debits any withdrawals made from such well to the correct personal groundwater account.
11. The person is responsible for exercising the person's correlative right for maintaining the person's ability to use, access and withdraw the groundwater associated with the person's right in the relevant basin or subbasin.
B. A landowner who owns one or more tax parcels identified pursuant to section 45-502, subsection a, paragraph 7 may apply to the director, on a form provided by the director, to claim ownership of and consolidate any personal groundwater accounts and associated correlative rights that correspond to the tax parcels and may request that the director assign the personal groundwater accounts and associated correlative rights to the landowner in a consolidated account.
C. An owner or operator of a community water system, municipal water system or other water distribution system that provides water service to one or more tax parcels identified pursuant to section 45-502, subsection a, paragraph 7 may apply to the director, on a form provided by the director, to claim ownership of any personal groundwater accounts and associated correlative rights that correspond to tax parcels that the owner or operator serves and may request that the director assign the personal groundwater accounts and associated correlative rights to the owner or operator, which shall be in the name of the water provider, in a single consolidated groundwater account.
D. Notwithstanding subsection b of this section, a landowner may not claim personal groundwater accounts or associated correlative rights that correspond to any tax parcels that are located within the distribution service area of an entity described in subsection C of this section.
E. The director shall establish an application process to credit an owner of an active or passive groundwater recharge facility located within a relevant basin or subbasin the difference between the owner's correlative right to annual natural recharge and the increase in annual natural recharge caused by the owner's recharge facility, as confirmed by the director. If multiple persons own an active or passive groundwater replenishment or recharge facility, the director shall award the additional credit to each owner's personal groundwater account in proportion to the ownership of a facility or as contracted among the parties.
F. Within ninety days after correlative rights are established in an eligible basin or subbasin, the director shall adopt rules to implement this section, including rules to:
1. Establish an application process for the assignment, reassignment and consolidation of personal groundwater accounts in a relevant basin or subbasin.
2. Establish a process for notifying the director of trades, transfers, conveyances, sales and purchases of groundwater credits or personal groundwater accounts and their associated correlative rights.
3. Enforce this section, including reasonable reporting requirements, measuring or monitoring requirements, well spacing requirements and well impact tests.
G. This article does not establish a right to have this state or any political subdivision of this state provide, guarantee access to or otherwise ensure a person's ability to access, use or withdraw groundwater from a relevant basin or subbasin. END_STATUTE
START_STATUTE45-504. Groundwater transportation; beneficial use; damages; exemption
A. Notwithstanding section 45-544, in an eligible basin or subbasin where correlative rights have been established:
1. Groundwater may be transported freely within the relevant basin or subbasin and is not appurtenant to the land, well or other location from which the groundwater was withdrawn or transported.
2. Groundwater may be transferred or conveyed separately from any parcel of land located within the relevant basin or subbasin.
3. Groundwater transfers and conveyances within a relevant basin or subbasin pursuant to this article constitute putting groundwater to a reasonable and beneficial use.
4. Groundwater that is transported within the relevant basin or subbasin is not subject to any claim for damages except an account holder may seek damages from a person that infringes or causes damage to the property or rights of the account holder. A person is not entitled to damages or other relief if the account holder has not suffered actual harm to the account holder's personal groundwater account, property or correlative rights. For the purposes of this paragraph:
(a) A decline in depth to water levels alone is insufficient to prove actual harm.
(b) A localized decline in depth to water levels that results from a cone of depression and that is found to be in violation of rules adopted by the director is sufficient to prove actual harm.
B. A landowner who owns one or more tax parcels identified pursuant to section 45-502 and who withdraws groundwater from not more than one exempt well in the relevant basin or subbasin may submit a notice to the director, on a form provided by the director, that exempts the owner from section 45-503 and rules adopted pursuant to that section except those concerning beneficial use.
C. Notwithstanding any other provision of this article, if the department receives a notice pursuant to subsection B of this section:
1. The exempt landowner is not entitled to claim a personal groundwater account or receive a correlative groundwater right.
2. The exempt landowner is not entitled to receive the damages, protection or benefits that are provided to owners of personal groundwater accounts.
3. The department shall subtract from the total surface area of eligible acres calculated pursuant to section 45-502, subsection a, paragraph 1 the eligible acres that are located within the tax parcels associated with the exempt landowner and shall allocate to all other eligible acres in the relevant basin or subbasin the correlative rights to groundwater and correlative rights to annual natural recharge that otherwise would have been allocated to the exempt landowner's eligible acres.
D. An exempt landowner may revoke the exempt landowner's exemption by submitting an application to the director, on a form provided by the director, requesting that the director revoke the landowner's exemption and establish a personal groundwater account. The application shall include evidence demonstrating that the exempt landowner has acquired from other personal groundwater account holders in the relevant basin or subbasin a volume of groundwater credits that is at least equal to the volume of correlative rights that the director otherwise would have allocated to the exempt landowner pursuant to subsection C, paragraph 3 of this section. Any groundwater that the exempt landowner withdrew from the relevant basin or subbasin between the effective date of this section and the effective date of the landowner's personal groundwater account shall be debited from the landowner's personal groundwater account on the effective date of the landowner's personal groundwater account. END_STATUTE
START_STATUTE45-505. Rights subject to appropriation; subflow; surface water; effect on adjudication
For the purposes of this article, a person may not appropriate subflow or surface water out of priority. This article does not exempt subflow or surface water from a general stream adjudication. END_STATUTE
START_STATUTE45-506. Ten-year review; report; audit; recalculation of correlative rights
A. On the tenth anniversary of establishing correlative rights in an eligible basin or subbasin and every ten years thereafter, the director shall complete an updated hydrological review of the relevant basin or subbasin to reassess each of the following:
1. The total volume of groundwater available to the maximum depth of bedrock at all points in the relevant basin or subbasin.
2. The average total volume of annual natural recharge over the preceding thirty years in the relevant basin or subbasin.
B. On completing the updated hydrological review prescribed by subsection a of this section, the director shall audit each personal groundwater account in the relevant basin or subbasin and do all of the following:
1. Adjust each personal groundwater account to reflect updates, errors or corrections in reporting, metering, measuring or monitoring groundwater withdrawals, account credit transfers or recharge.
2. Reassign to each personal groundwater account in the relevant basin or subbasin an updated lump sum volume of groundwater associated with the personal groundwater account holder's correlative right to groundwater, minus the total volume of groundwater withdrawn or debited from the account in each of the last ten years, plus the total volume of groundwater credited to the account in each of the last ten years.
3. Reassign to each personal groundwater account in the relevant basin or subbasin an updated annual recharge credit associated with the personal groundwater account holder's correlative right to annual natural recharge.
C. On completion of every ten year audit, the director shall submit a report regarding the audit and make recommendations for administrative or legislative action to the governor, the president of the senate and the speaker of the house of representatives and shall provide a copy of this report to the secretary of state. END_STATUTE
Sec. 3. Correlative rights; statewide establishment; election
A. On the effective date of this act, the secretary of state shall work to place a question on the statewide 2026 general election ballot as to whether the director of the department of water resources should establish correlative rights in all eligible basins and subbasins.
B. All qualified electors who are registered to vote in this state are eligible to vote on the question prescribed by this section. The ballot shall state "Should correlative rights to groundwater, as defined by section 45-501, Arizona Revised Statutes, as added by this act, be established in all eligible basins and subbasins?" followed by the words "Yes" and "No". If a majority of those qualified electors voting on the question votes to approve the establishment of correlative rights to groundwater, the director shall immediately follow the procedures prescribed by this act.