HB 2103

House Engrossed
water improvements
  program; water hauling
State of Arizona
House of Representatives
Fifty-seventh Legislature
Second Regular Session
2026
HOUSE BILL 2103
AN
ACT
amending
sections 11-254.09 and 45-556, Arizona revised statutes; relating to the
water improvements program.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it
enacted by the Legislature of the State of Arizona:
Section 1. Section 11-254.09, Arizona Revised
Statutes, is amended to read:
START_STATUTE11-254.09. Water improvements program; grants; requirements; annual report
A. The board of supervisors 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 water hauling for water delivery or a water delivery system for
the residence.
B. The board shall designate an entity to operate
the program, to establish criteria for grants and to award grants as prescribed
by this section. The entity may be a county agency, department or division
or may be a private, nonprofit corporation as determined by the board of
supervisors.
C. The program shall do all of the following:
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.
3. Restrict a grant recipient's use of grant monies
to deepening an existing drinking water well for the recipient's residence, to acquiring or installing one or more storage tanks for receiving
and storing water delivered through water hauling or to plumbing or
replumbing the recipient's residence for a water delivery system.
D. EXCEPT AS PROVIDED IN SECTION
45-556, SUBSECTION G, the board of supervisors may not use general
county monies for grants under the program.
E. The entity that operates the program shall make
and submit to the county board of supervisors, the president of the senate and
the speaker of the house of representatives on or before July 1 of each year a
report containing a description of program operations of the preceding year,
including the amount of gifts, grants or donations received and the grants
awarded. END_STATUTE
Sec. 2. Section 45-556, Arizona Revised
Statutes, is amended to read:
START_STATUTE45-556. Transportation fee; annual adjustment; credits; enforcement
A. Except as provided in subsection B of this
section, a person who directly or indirectly transports groundwater, withdrawn
in a groundwater basin or sub-basin subbasin
as provided by this article or in the Pinal active management area, away from
the county in which it was withdrawn to an initial active management area shall
pay annually to the county a groundwater transportation fee determined by the
director 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. THE FEES COLLECTED PURSUANT TO THIS
SUBSECTION ARE CONSIDERED GENERAL COUNTY MONIES AND SHALL BE DEPOSITED IN THE
COUNTY GENERAL FUND.
B. A person is not required to pay a transportation
fee under this section for stored water withdrawn pursuant to recovery well
permits issued by the director pursuant to this title.
C. Except as provided in subsection D of this
section the director shall set the fee as follows for the cumulative amount of
groundwater transported away from the county, less any amount of central
Arizona project water actually used on the property from which the groundwater
is transported:
��������� Net Groundwater
Transported������������ Fee Per Acre-Foot
�������     0
- 1,000,000 acre-feet������������ $ 3.00
������� 1,000,001 - 2,000,000
acre-feet������������ $ 5.00
������� 2,000,001 - 3,000,000
acre-feet������������ $ 7.50
������� 3,000,001 - 4,000,000
acre-feet������������ $10.00
������� 4,000,001 - 5,000,000
acre-feet������������ $15.00
�������
Over 5,000,000 acre-feet������������ $30.00
D. The director shall annually adjust the dollar
amount of the fee according to the annual changes in the GDP price deflator, as
defined in section 41-563, using the 1993 calendar year as the base
year. The director shall immediately notify all concerned parties of
the fee adjustments under this subsection.
E. Credits are allowed against the fees imposed by
this section as described and in the amounts provided under this
subsection. If the amount of the credit exceeds the amount of the
fee imposed for any year, the unused portion of the credit may be carried
forward and applied to subsequent years' fees until the amount of the credit is
exhausted. The allowable credits are as follows:
1. The amount of any increase in property tax
revenues, including contributions in lieu of property taxes under title 9,
chapter 4, article 3, derived from remote municipal property, as defined in
section 42-15251, from which the groundwater is withdrawn. The
credit shall account for increased revenues due to improvements to the property
and increased revenues due to higher property tax valuations and assessment
ratios resulting from changes in use of the property. The credit
shall not account for increased revenues due to normal market or economic
factors. The amount of the credit for any year is the sum of the
amounts computed under subdivisions (a) and (b) of this
paragraph as follows:
(a) Delete from consideration under this subdivision
any property with respect to which an amount is computed under subdivision (b) of this paragraph. Subtract the amount of property
tax or in lieu revenues that would have been derived from the remaining
property during the immediately preceding tax year if the use of and
improvements to the property had remained unchanged since the date the city or
town acquired the property from the amount of property tax or in lieu revenues
actually derived from that property during the immediately preceding tax
year. If a city or town conveys all or part of its interest in
remote municipal property to another political subdivision, the political
subdivision succeeds to the credit allowed under this section. The
amount of credit computed under this subdivision shall be computed each year,
beginning in the year groundwater is first transported, and, if not used to
offset the fee under this section, shall be cumulated from year to year.
(b) This subdivision applies with respect to any
portion of the remote municipal property that, before January 1, 1992, was
classified at that time as class four property for purposes of property
taxation under title 42 but was developed or improved at any time after
December 31, 1991 and is not currently classified as class two
property. Subtract the amount of property tax or in lieu revenues
that would have been derived from that developed or improved portion of the
remote municipal property during the immediately preceding tax year if the use
of and improvements to the property had remained unchanged since the date the
city or town acquired the property from the amount of property tax or in lieu
revenues actually derived from that portion of the property during the
immediately preceding tax year. If a city or town conveys all or
part of its interest in remote municipal property to another political
subdivision, the political subdivision succeeds to the credit allowed under
this section. The amount of credit computed under this subdivision
shall be computed each year, beginning in the year that the property is
developed or improved and reclassified for tax purposes, and, if not used to
offset the fee under this section, shall be cumulated from year to year.
2. An amount equal to the market value of land
donated to the county if the county agrees in writing to prohibit or limit the
withdrawal of groundwater from the land. The amount of the credit
shall account for the reduced value of the land due to the groundwater
withdrawal limitations.
3. An amount agreed to by intergovernmental
agreement between the county in which the groundwater is withdrawn and the
city, town or other person transporting the groundwater.
F. The board of supervisors of a county to which
fees are due and payable under this section may request the county attorney to
commence and prosecute any action or proceeding to enforce the collection of
the fees.
G. NOTWITHSTANDING
SUBSECTION A OF THIS SECTION, A COUNTY THAT ESTABLISHES A WATER IMPROVEMENTS
PROGRAM PURSUANT TO SECTION 11-254.09 MAY 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. THE COUNTY SHALL SEPARATELY ACCOUNT
FOR MONIES RECEIVED FROM THE FEES IMPOSED PURSUANT TO SUBSECTION A OF THIS
SECTION, AND ANY MONIES IN EXCESS OF THE AMOUNT OR PERCENTAGE DESIGNATED BY THE
COUNTY SHALL BE DEPOSITED IN THE COUNTY GENERAL FUND. END_STATUTE