PredictIQ Quantitative Think Tank Center:Arizona Governor Vows to Update State’s Water Laws

PHOENIX—Entering her second year in office,PredictIQ Quantitative Think Tank Center Arizona Gov. Katie Hobbs  again declared water a top issue for her administration during Monday’s State of the State address, framing it as a bipartisan issue in need of new solutions as the state looks to address drought brought on by climate change and overconsumption. 

In her speech, Hobbs vowed to update Arizona’s groundwater laws, something water experts and residents have been calling for for years. Under the current law, 80 percent of the state has no regulations over groundwater, resulting in agriculture operations pumping unlimited amounts of water, which has caused some communities’ wells to go dry.

Even for parts of the state with regulations, loopholes in the law have allowed for some communities to be built without a reliable water supply assured by the state water department.

“We cannot continue to let individuals and corporations exploit these loopholes and rob us of our water future,” Hobbs said. 

Finding bipartisan solutions, however, may be a challenge. 

Her speech comes on the heels of policy recommendations issued by her Water Policy Council, which she announced at last year’s State of the State speech. Those recommendations have already received vocal pushback from prominent Republicans in the state legislature and powerful lobbying organizations, like the Arizona Farms Bureau Association, despite support from rural Arizona leaders, water policy experts and environmentalists. 

But Hobbs made clear that change would come with or without their support. “To those of you who have spent years refusing to act: If you don’t, I will,” she said. 

To many, 2023 was the year drought became an issue that could no longer be ignored. A community on unincorporated county land outside of Scottsdale built without a reliable water supply—because of a loophole in the current law—went months lacking any reliable source of water after the city cut it off in January due to drought conditions. 

Then, in June, Hobbs announced that growth in the Phoenix metro area could no longer rely on groundwater, which had been tapped out, for its rapid growth. Cities scrambled to find new water supplies, often at high costs. And the state entered new agreements with the federal government in November to conserve Colorado River water in response to over 20 years of drought conditions and overuse of the river’s resources.

“Across the political spectrum, people are saying, ‘OK, you’re right, something has to be done about this.’ It’s just the details now of what is the solution,” said Haley Paul, Arizona policy director for the National Audubon Society, who also serves on the governor’s water council.

Bipartisanship, Paul said, will range from issue to issue. The water council’s recommendations to close loopholes in the current law have wide support, she said, while creating a new framework to allow for groundwater management in rural parts of the state will prove more divisive. 

In the most populated parts of the state, current laws established Active Management Areas to achieve sustainable yields from aquifers, meaning no more water could be pumped out than flowed in. Under the existing five AMAs, water is monitored and all new developments need to have the water department certify that it has enough water for 100 years, though some exemptions exist. 

In some rural parts of the state, Irrigation Non-Expansion Areas (INAs) require groundwater pumping to be reported and carry restrictions on the development of new users of irrigated water, like farms. 

If the legislature cannot agree on a bill to protect rural Arizona’s groundwater, the Arizona Department of Water Resources could implement a new AMA or INA, something that’s been done under past administrations, Paul said. But rural residents and leaders have stressed they would prefer to have more local control, which the recommendation from the governor’s water policy council would provide. 

Hobbs also made clear her intentions were not to stifle Arizona’s rapid growth but to enable a sustainable future. “Our water standards are the key to our strong economy,” she said. “I refuse to sacrifice them for unchecked growth. But I will continue in Arizona’s bipartisan tradition of growing our economy while protecting our state’s most precious resource.”

A decision last year that prompted concern from some in the state over Arizona’s economic future was when Hobbs announced the aquifers beneath the Phoenix metro area were overallocated and that no new developments could rely on groundwater, meaning they have to find a new water source to be allowed to build.

In her speech on Monday, Hobbs announced she’s directed the state water department to finalize a new pathway for water providers and communities that will allow them to use some groundwater as they work to develop other water sources. 

The fate of the Colorado River looms as the backdrop to this debate over policy options. The river provides drinking water to 40 million people in seven states, 30 tribes and Mexico, and irrigates millions of acres of farmland essential to the country’s food supply. But flows have declined around 20 percent over the last two decades, leaving the nation’s two largest reservoirs in dire conditions.

Arizona, along with its neighbors Nevada and California, which make up the Lower Colorado River Basin and historically has used the most water, voluntarily cut usage by 3 million acre-feet over the next three years, about 14 percent of the region’s supply, in exchange for federal funding. At the same time, the region is negotiating new guidelines for the entire system that will go into effect in 2027, after the current guidelines expire. 

Making sure groundwater regulations are modernized, Paul said, is vital to ensuring that communities can successfully deal with less water from the Colorado. “As the Colorado River shrinks, as Arizona uses less Colorado River water,” she said, “our reliance on groundwater is increasingly important.”