§ 45-465.05 — Permanent relinquishment of irrigation grandfathered rights; groundwater savings credits; assured water supply; rules; report; definitions

Arizona § 45-465.05

• Jurisdiction: Arizona
• Title 45: Arizona Revised Statutes
• Ch. 2: GROUNDWATER CODE
• Art. 5: Grandfathered Groundwater Rights in Active Management Areas

Text

(Rpld. 1/1/36)

A. A person that owns land within the Phoenix or Pinal active management area that may be legally irrigated with groundwater pursuant to an irrigation grandfathered right may apply to the director to permanently relinquish all of the irrigation grandfathered right in exchange for groundwater savings credits. The director shall approve the application if all of the following conditions apply:

1. The person's use of the irrigation grandfathered right complies with this chapter and the applicable management plan.

2. For each irrigation grandfathered right that is relinquished, the director determines that land to which the irrigation grandfathered right is appurtenant has been legally irrigated with groundwater in at least three of the preceding five years.

3. The person has filed all reports required pursuant to section 45-632 for the last five years.

4. The person does not maintain a negative balance in the person's flexibility account established pursuant to section 45-467.

5. The department has not issued a certificate of assured water supply for the acres associated with the relinquishment.

B. The director shall quantify groundwater savings credits. When quantifying groundwater savings credits, the following apply:

1. The amount of groundwater savings credit shall be determined in acre-feet by multiplying the acres associated with the relinquishment by the following conversion multiplier:

(a) In the Phoenix active management area, one hundred fifty.

(b) In the Pinal active management area, one hundred.

2. A person may not receive groundwater savings credits for a volume of water that exceeds sixty times the mean amount of groundwater used annually pursuant to the irrigation grandfathered right in the three years with the highest use during the five years preceding an application to permanently relinquish the irrigation grandfathered right. If a person applies to relinquish an irrigation grandfathered right after conveyance of an irrigation grandfathered right, the mean amount of groundwater used annually shall be determined using a proportionate share of the total amount of groundwater used annually pursuant to any irrigation grandfathered rights appurtenant to the land included in the irrigation grandfathered right that the person has applied to relinquish in the years used to satisfy the requirements of subsection A, paragraph 2 of this section.

C. When issuing groundwater savings credits, the director shall:

1. Identify all of the following:

(a) The amount of groundwater savings credits as calculated pursuant to subsection B of this section.

(b) The number and location of the acres associated with the relinquishment.

(c) The wells that have been used to serve land to which the irrigation grandfathered right is appurtenant.

(d) The owner of the acres associated with the relinquishment at the time of the relinquishment that holds the groundwater savings credits.

2. Determine whether the criteria prescribed in subsection D, paragraph 3 or subsection E, paragraph 3 of this section would be satisfied. This determination shall be applied to an assured water supply application that is submitted to the department within two years after the date the groundwater savings credits are issued and shall remain valid until the director makes a final decision on the assured water supply application.

D. For the purposes of a designation or modification of a designation of assured water supply, the volume of groundwater withdrawn or stored water recovered outside the area of impact of storage associated with groundwater savings credits calculated pursuant to subsection B of this section is exempt from the requirement to demonstrate that the groundwater is physically available in accordance with section 45-576 if all of the following apply:

1. The acres associated with the relinquishment and the location of the proposed use associated with the groundwater savings credits are or will be within the service area of a municipal provider that is designated as having an assured water supply or that has applied for a designation of assured water supply.

2. The applicant proposes to withdraw groundwater or stored water recovered outside of the area of impact of storage associated with the groundwater savings credits from one or more of the following locations:

(a) Any well that was used to serve land to which the irrigation grandfathered right is appurtenant.

(b) Any well that is located within one mile of any well that was used to serve land to which the irrigation grandfathered right is appurtenant.

(c) Any well that is located on the acres associated with the relinquishment.

(d) Any well that is located within one mile of the acres associated with the relinquishment.

3. The applicant demonstrates that groundwater or stored water recovered outside the area of impact of storage can be withdrawn to serve the proposed use for one hundred years without exceeding the depth of the aquifer or the applicable depth-to-static water level limit of the active management area, whichever is less. For the purposes of this demonstration:

(a) The director may not consider other withdrawals that exceed the depth of the aquifer or the applicable depth-to-static water level limit during the one hundred-year period as follows:

(i) In the Phoenix active management area, the depth-to-static water level limit is one thousand feet below land surface.

(ii) In the Pinal active management area, the depth-to-static water level limit is one thousand one hundred feet below land surface.

(b) For withdrawals located within one mile of any well that was used to serve land to which the irrigation grandfathered right is appurtenant, the applicant may rely on the director's determination pursuant to subsection C of this section, if applicable, or on the director's most recent assured water supply projection to satisfy this requirement. This subdivision shall not apply if more than forty percent of the water used during the period used in the director's most recent assured water supply projection by land to which the irrigation grandfathered right is appurtenant was in lieu water as defined in section 45-802.01.

(c) Except as provided by subdivision (b) of this paragraph, the applicant must update the director's most recent assured water supply projection only to make reasonable modifications to the locations or rates of the withdrawals to reflect the changes that result from the proposed use.

4. The applicant submits evidence to the department that the water used pursuant to the groundwater savings program established under this section will not be used on any of the following:

(a) Turf that is not located in a recreational use area or other space that is regularly used for stormwater management or for civic, community or other recreational purposes, including playgrounds, sports fields, cemeteries or schoolyards.

(b) Water parks.

(c) Decorative water features, including lakes, ponds or lagoons, except as provided in section 45-132, subsection B, paragraph 4, subdivision (a).

E. For the purposes of an application for a certificate of assured water supply that proposes to rely on groundwater savings credits, the volume of groundwater or stored water recovered outside the area of impact of storage associated with the amount of groundwater savings credits calculated pursuant to subsection B of this section is exempt from the requirement to demonstrate that the groundwater or stored water recovered outside the area of impact of storage is physically available in accordance with section 45-576 if all of the following apply:

1. The proposed use associated with the groundwater savings credits is on the acres associated with the relinquishment or on land that is located within one mile of the exterior boundary of the acres associated with the relinquishment.

2. The applicant proposes to withdraw groundwater or stored water recovered outside the area of impact of storage associated with the groundwater savings credits from one or more of the following locations:

(a) Any well that was used to serve land to which the irrigation grandfathered right is appurtenant.

(b) Any well that is located within one mile of any well that was used to serve land to which the irrigation grandfathered right is appurtenant.

(c) Any well that is located on the acres associated with the relinquishment.

(d) Any well that is located within one mile of the acres associated with the relinquishment.

3. The applicant demonstrates that groundwater or stored water recovered outside of the area of impact of storage can be withdrawn to serve the proposed use for one hundred years without exceeding the depth of the aquifer or the applicable depth-to-static water level limit of the active management area, whichever is less. For the purposes of this demonstration:

(a) The director may not consider other withdrawals that exceed the depth of the aquifer or the applicable depth-to-static water level limit during the one hundred-year period as follows:

(i) In the Phoenix active management area, the depth-to-static water level limit is one thousand feet below land surface.

(ii) In the Pinal active management area, the depth-to-static water level limit is one thousand one hundred feet below land surface.

(b) For withdrawals located within one mile of any well that was used to serve the irrigation grandfathered right, the applicant may rely on the director's determination pursuant to subsection C of this section, if applicable, or on the director's most recent assured water supply projection to satisfy this requirement. This subdivision shall not apply if more than forty percent of the water used by the irrigation grandfathered right during the period used in the director's most recent assured water supply projection was in lieu water as defined in section 45-802.01.

(c) Except as provided by subdivision (b) of this paragraph, the applicant must update the director's most recent assured water supply projection only to make reasonable modifications to the locations or rates of the withdrawals to reflect the changes that result from the proposed use.

4. The applicant submits evidence to the department that the water used pursuant to the groundwater savings program established under this section will not be used on any of the following:

(a) Turf that is not located in a recreational use area or other space that is regularly used for stormwater management or for civic, community or other recreational purposes, including playgrounds, sports fields, cemeteries or schoolyards.

(b) Water parks.

(c) Decorative water features, including lakes, ponds or lagoons, except as provided in section 45-132, subsection B, paragraph 4, subdivision (a).

F. An applicant that submits an application for a certificate of assured water supply on or before December 31, 2030 may rely on groundwater savings credits pledged to the certificate that is issued based on that application. An applicant may not pledge groundwater savings credits to an application for a certificate of assured water supply that is submitted on or after January 1, 2031.

G. The director shall adopt rules on or before June 30, 2026 through expedited rulemaking to:

1. Set licensing time frames to issue groundwater savings credits.

2. Develop a summary process to apply groundwater savings credits to designations of assured water supply.

H. Before the director issues groundwater savings credits, the director shall both:

1. Notify the holder of the irrigation grandfathered right in writing of the department's preliminary recommendations regarding the items described in subsection C of this section.

2. Request written confirmation that the holder of the irrigation grandfathered right would like to proceed with relinquishment. On receipt of confirmation that the applicant would like to relinquish the irrigation grandfathered right, the director shall issue groundwater savings credits pursuant to subsection C of this section.

I. A person that holds groundwater savings credits may assign the person's credits to the subsequent owner of the acres associated with the relinquishment. A person that holds groundwater savings credits may pledge the credits to an assured water supply application that proposes to rely on the credits pursuant to subsection D or E of this section.

J. After the director issues a certificate of assured water supply based on groundwater savings credits, if a municipal provider that serves acres associated with the relinquishment becomes a designated provider or if the service area of a designated provider is extended to include the subdivision for which a certificate of assured water supply was issued, the remaining groundwater savings credits associated with the certificate shall be used to support the designation.

K. On acres associated with the relinquishment and areas within one mile of the acres associated with the relinquishment that use groundwater pursuant to subsection E of this section, the following prohibitions apply:

1. A municipal provider or association as defined in section 33-1802 may not use the groundwater or stored water recovered outside the area of impact of storage for any of the following:

(a) Application to turf that is not located in a recreational use area or other space that is regularly used for stormwater management or for civic, community or recreational purposes, including playgrounds, sports fields, cemeteries or schoolyards.

(b) Water parks.

(c) Decorative water features, including lakes, ponds or lagoons, except as provided in section 45-132, subsection B, paragraph 4, subdivision (a).

2. An association as defined in section 33-1802 may not adopt or enforce any of the following:

(a) Minimum turf requirements for turf that is not located in a recreational use area or other space that is regularly used for stormwater management or for civic, community or recreational purposes, including playgrounds, sports fields, cemeteries or schoolyards.

(b) Requirements for the installation, filling or refilling of:

(i) Water parks.

(ii) Decorative water features, including lakes, ponds or lagoons, except as provided in section 45-132, subsection B, paragraph 4, subdivision (a).

L. The director may adopt rules to implement the groundwater savings program prescribed by this section for the Tucson active management area that include an applicable conversion multiplier and necessary parameters to ensure groundwater savings in the Tucson active management area if the director determines that all of the following apply:

1. Groundwater withdrawals in the Tucson active management area over a period of one hundred years will exceed the depth-to-static water level of one thousand feet or the depth of the aquifer, whichever is less.

2. A groundwater savings program established in the Tucson active management area would reduce groundwater use over the next one hundred years.

3. Expanding the program to include the Tucson active management area would be in the best interest of that active management area and of a conservation district.

M. Section 45-114, subsections A and B govern administrative proceedings, rehearing or review and judicial review of final decisions of the director pursuant to this section.

N. On application to the director by the current owner of the acres associated with the relinquishment, the director shall restore a relinquished irrigation grandfathered right and rescind all issued groundwater savings credits if the groundwater savings credits have not been pledged to a certificate of assured water supply or a designation of assured water supply pursuant to section 45-576, subsection M.

O. For the purposes of this section:

1. "Acres associated with the relinquishment" means land to which the irrigation grandfathered right that is relinquished in exchange for groundwater savings credits was appurtenant.

2. "Municipal provider" has the same meaning prescribed in section 45-561.

3. Stored water recovered outside the area of impact does not include long-term storage credits issued to the Arizona water banking authority or held by the Arizona water banking authority at any time.

4. "Well" includes a replacement well as prescribed in section 45-597 or 45-598.