Judge agrees with developers in rejecting ADWR’s ‘water tax’

By Yellow Sheet

A judge struck down a rule from the Arizona Department of Water Resources requiring developers to prove there’s a higher supply of groundwater than what’s required by state law to start building homes.

Judge Scott Blaney sided with the Home Builders Association of Central Arizona, Senate President Warren Petersen and House Speaker Steve Montenegro in finding the department’s rule acts as an undue “water tax” and exceeds state law and agency authority.

“Through the implementation of its moratorium and its nearly simultaneous promulgation of a Rule that demands more water than the statute requires, ADWR has in effect attempted to rewrite the governing statute at the agency level,” Blaney wrote.

Before breaking ground, a developer must secure a certificate from ADWR confirming a 100-year supply of physically available groundwater before building a subdivision.

But because of insufficient groundwater in the Phoenix and Pinal Active Management Areas, ADWR has ceased giving approval to new developers.

The agency amended its rules to create a workaround, though, with the option for a developer to prove a new alternative water supply, granted it exceeds the project’s proposed use by 25%.

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