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ARIZONA STATE SENATE
Fifty-Seventh Legislature, Second Regular Session
water improvements program; water hauling
Purpose
Modifies the requirements of a water improvements program by allowing persons to make gifts, grants or donations for the purpose of providing financial assistance to qualified owners of residential real property for water hauling, water delivery and by allowing a county with a water improvements program to use the collections from groundwater transportation fees only for qualified owners of residential property who reside within the groundwater transportation basin.
Background
A county board of supervisors (county BOS) may establish a program to allow persons to make gifts, grants or donations for the purpose of providing financial assistance to qualified owners of residential real property for making improvements to an existing drinking water well or providing for a water delivery system for the residence. The county BOS must establish an entity to operate the program, to establish criteria for grants and to award grants. The entity may be a county agency, department or division or may be a private, nonprofit corporation as determined by the county BOS. The program must: 1) limit grant recipients to persons who are low-income or fixed income owners of residential property; 2) develop application criteria and criteria for awarding grants; and 3) restrict a grant recipient's use of grant monies to deepening an existing drinking water well for the recipient's residence or to plumbing or replumbing the recipient's residence for a water delivery system (A.R.S. § 11-254.09).
A person who directly or indirectly transports groundwater, withdrawn in a groundwater basin or subbasin or in the Pinal Active Management Area (AMA), away from the county in which it was withdrawn to an initial AMA must pay annually to the county a groundwater transportation fee determined by the Director of the Arizona Department of Water Resources (ADWR) for each acre-foot of groundwater transported directly or indirectly away from the county, less any amount of Central Arizona Project water actually used on the property from which the groundwater is transported. A person is not required to pay a transportation fee for stored water withdrawn pursuant to recovery well permits issued by the Director of ADWR. The Director of ADWR must annually adjust the dollar amount of the fee according to the annual changes in the GDP price deflator using the 1993 calendar year as the base year and notify all concerned partied of the fee adjustments (A.R.S. § 45-556).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Allows, for a water improvements program, persons to make gifts, grants or donations for the purpose of providing financial assistance to qualified owners of residential real property for providing water hauling for water delivery.
2. Adds acquiring or installing storage tanks for water delivered through water hauling to the list of projects for which a recipient's grant must be used.
3. Allows a county that establishes a water improvements program to designate an amount or percentage of the total groundwater transportation fees received to be used under the water improvements program only for qualified owners of residential property who reside within the groundwater basin or subbasin from which the groundwater was withdrawn and transported away.
4. Specifies that the collections from the statutorily prescribed groundwater transportation fees are considered general county monies and must be deposited in the county general fund.
5. Requires the county to separately account for monies received from the groundwater transportation fees and any monies in excess of that amount or percentage designated by the county to be deposited in the county general fund.
6. Makes technical and conforming changes.
7. Becomes effective on the general effective date.
House Action
NREW 2/10/26 DP 6-4-0-0
3rd Read 2/26/26 31-22-7
Prepared by Senate Research
March 13, 2026
SB/hk