Arizona groundwater ruling could be 'death knell' for 100-year water supply rule, expert says

A state judge ruled this week that the Arizona Department of Water Resources illegally changed how it evaluates whether there’s enough groundwater to build new homes in parts of the Valley. The decision is a win for the Home Builders Association of Central Arizona, which had sued.

State law requires builders in certain parts of the state — including the Phoenix area — to prove there’s an assured hundred-year water supply for houses being built there.

But shortly after Gov. Katie Hobbs took office, she released a report showing the Phoenix Active Management Area was short of that. Those numbers led to a pause in building new homes in parts of the Valley.

Kathleen Ferris, senior research fellow at the Kyl Center for Water Policy at Arizona State University's Morrison Institute for Public Policy, joined The Show to talk about the ruling and its potential impacts. Ferris was also instrumental in crafting the 1980 Groundwater Management Act.

Politics

Arizona water agency regulations that restricted homebuilding were illegal, judge rules

Camryn Sanchez

Arizona’s water agency acted illegally when it created new water regulations in 2024 that restricted homebuilding in the Phoenix area, a judge ruled Tuesday.

Full conversation

MARK BRODIE: Kathy, good morning.

KATHLEEN FERRIS: Good morning. How are you?

MARK BRODIE: I’m doing all right, thanks. So, I’m curious just to sort of get your response to this, to this ruling here.

KATHLEEN FERRIS: Well, how much time do I have? So here’s the thing. The case goes to the very heart of Arizona’s assured water supply requirement and its preservation.

And so let’s back up for a minute. This has been a requirement of Arizona’s law for 45 years now. And when groundwater is involved, the applicant for an assured water supply determination must show that its proposed pumping of groundwater over 100 years will not exceed a certain depth to water and will not impact existing users of groundwater.

For decades, the department relied on computer models to make this determination. But those models have improved over the years. And in [2023], the department found that the groundwater in the greater Phoenix area was even more interconnected. And that pumping of groundwater for new subdivisions would create a shortage of groundwater over the next 100 years for existing users. Hence, Gov. Hobbs declared a moratorium on granting new certificates of assured water supply. ...

MARK BRODIE: Yeah. Well, I was going to say like, do you think that the homebuilders were basically saying, "Look, this is — we have a housing crisis here, especially in the Phoenix metro area. You know, governor and administration, you’re telling us we can’t build homes for people in this area." How do you balance those two things, especially when homes tend to use less water than other uses like things like agriculture?

KATHLEEN FERRIS: So backing up, the Home Builders Association and the Goldwater Institute are talking about homes on raw desert land. They’re not talking about homes that would be put on retired agricultural land. They want to build on vast swaths of desert land that have never had any groundwater use. So this is a new use.

And also, what’s more important? Is a water supply for the homes that are already here, for the people that are already here, for the investments that have already been made more important than building new homes?

I would say yes. I would say that we have to make that determination — especially, especially now that we’re seeing shortages of Colorado River water, and we know that our water providers in this Valley are going to need to rely more and more on groundwater.

MARK BRODIE: We should note the state Department of Water Resources has suggested that it will appeal this ruling. And I’m wondering if you think that there’s anything that they can say that might get an appeals court, or maybe if it goes to the state Supreme Court, to see this differently than ... first judge saw?

KATHLEEN FERRIS: Well, absolutely I do. I totally disagree with Judge [Scott] Blaney’s reasoning and analysis. There is nothing new in what the department is doing. The department is following assured water supply rules that have been in effect for 20 years or more.

And the court’s decision ignores — it’s an assault on science. It’s an assault on ADWR’s long-standing practices. It moves us back to when it was legal to put in a well and pump as much water as you wanted, even if you impacted your neighbors. To the days when the person with the most money and the deepest well wins.

So I think the department is on firm ground here. They have not changed their practices, they have just applied the science that has developed over the years and what their model has showed to the situation on the ground.

And we cannot, we cannot allow developers to build hundreds of thousands of new homes served with groundwater when we already have a problem with our groundwater supplies and when we have shortages of Colorado River water impending.

MARK BRODIE: The Hobbs administration has been touting its alternative system for getting a certificate for an assured 100-year water supply. Let’s assume for a moment, I know you hope this is not the case, but let’s assume for a moment that this ruling stands. Does that mean that the alternative program — what happens to that if homebuilders, maybe seems like maybe they wouldn’t need that anymore?

KATHLEEN FERRIS: Well, I think that’s true. And you and I know that when that alternative program was being discussed, the lobbyist for the Home Builders Association basically said, “This isn’t going to do us any good.” Because they don’t want to build on those ag lands. They want to build these vast, master-planned communities out in the pristine desert.

MARK BRODIE: So you think it would like the alternative program maybe just would slide away, in a sense?

KATHLEEN FERRIS: I think it wouldn’t be as popular, I will tell you that. And you know, I really think that if this decision is allowed to stand, it may be the death knell of the assured water supply requirement.

You know, Tom Buschatzke, the director of the department, put it best: “What is at stake in this lawsuit is the ability of the state to protect the Arizonans that are here today, by ensuring that their water supplies don’t run out or water levels fall to alarming depths of 1,000 feet due to new groundwater pumping.”

This decision would really put a dent, a big dent, like breaking the dam of the assured water supply requirement.