HB2545 - 541R

Be it enacted by the Legislature of the State of Arizona:

Section 1. Title 45, chapter 1, article 1, Arizona Revised Statutes, is amended by adding section 45-118, to read:

START_STATUTE45-118. Arizona system conservation fund; purpose; report

A. The Arizona system conservation fund is established consisting of legislative appropriations, grants and contributions from private and public entities. The director shall administer the fund. Monies in the fund are continuously appropriated for the purposes of THIS section. The director may spend monies from the fund to contract with Colorado River water users in this state that hold entitlements to Colorado River water under the decree in Arizona v. California to forgo water deliveries or diversions for the purpose of creating system conservation. Contracts entered into pursuant to this section are exempt from title 41, chapter 23.

B. System conservation created through the use of the fund shall provide for Colorado River water to be conserved in Lake Mead through a verified reduction in existing consumptive use in order to decrease the likelihood of lake elevations dropping to levels that could result in reductions to this state's Colorado River allocation. System conservation must be created for the benefit of the Colorado River system and not for the benefit of any individual Colorado River water user.

C. On notice from the director, the state treasurer shall invest and divest monies earned as provided by section 35-313, and monies earned from investment shall be credited to the fund. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

D. Beginning July 1, 2021 and on July 1 each year thereafter, the director shall submit a detailed report to the governor, the president of the senate and the speaker of the house of representatives and provide a copy of this report to the secretary of state. The report shall describe the expenditures made from the fund during the previous fiscal year and the volume of water that was conserved in lake mead.END_STATUTE

Sec. 2. Delayed repeal

Section 45-118, Arizona Revised Statutes, as added by this act, is repealed from and after March 31, 2027.

Sec. 3. Section 45-514, Arizona Revised Statutes, is amended to read:

START_STATUTE45-514. Mineral extraction and metallurgical processing permit; conditions for issuance; duration of permit

A. Except as provided in subsection D of this section, a person who is engaged in or proposes to engage in the extraction and processing of minerals shall be issued a permit to withdraw groundwater in the required amount, if all of the following apply:

1. The amount of groundwater available for mineral extraction, metallurgical processing and compliance with applicable environmental controls under a dewatering permit is insufficient.

2. Uncommitted municipal and industrial central Arizona project water is not available at the point where the operator's wellhead or distribution system would otherwise be, at a cost which does not exceed the current municipal and industrial central Arizona project delivery rates.

3. Other surface water of adequate quality or effluent of adequate quality is not available at the point where the operator's wellhead or distribution system would otherwise be, at a cost, including treatment costs, which does not exceed by twenty-five per cent percent the cost the operator would otherwise incur in withdrawing groundwater.

4. The applicant does not own or lease type 2 non-irrigation grandfathered rights originally based on withdrawals of groundwater for the extraction or processing of minerals that the applicant is not using or leasing and that can be used at the proposed location without imposing an unreasonable economic burden on the applicant.

B. A permit issued pursuant to this section shall be granted for a period of up to fifty years, subject to renewal under the same criteria used in granting the original permit.

C. If, during the duration of a mineral extraction and metallurgical processing permit, the director determines that uncommitted municipal and industrial central Arizona project water is available or surface water of adequate quality or effluent of adequate quality is available to the permittee at a cost comparable to groundwater, the director may require the permittee to use such water in lieu of groundwater.

D. Beginning January 1 of the calendar year following the year in which a groundwater replenishment district is required to submit its preliminary plan pursuant to section 45‑576.02, subsection A, paragraph 1, and except for an application to renew a mineral extraction and metallurgical processing permit, on receiving a permit application the director shall not issue a permit for a well in the district unless at the time the application is filed:

1. The director has determined that the district's plan for operation is consistent with achieving the management goal, according to section 45‑576.03, subsection E, and the designation has not expired.

2. The master replenishment account, as established in section 45‑858.01, does not have a debit balance in an amount in excess of the amount allowed under section 45-576.01, subsection A, paragraph 3.

E. If, during the duration of a mineral extraction and metallurgical processing permit issued after the effective date of this amendment to this section, the permittee earns long-term storage credits under section 45‑852.01, subsection B for the storage of central Arizona project water in the active management area in which the permittee has the right to withdraw groundwater pursuant to the permit, and the central Arizona project water qualified as water that cannot reasonably be used directly due solely to the exclusion of groundwater withdrawn by the permittee for mineral extraction or metallurgical processing pursuant to section 45‑802.01, paragraph 22 23, subdivision (c), the director shall establish a separate subaccount for those credits pursuant to section 45‑852.01, subsection A. After each calendar year in which the permit is in effect, the director shall debit the subaccount by the amount of groundwater pumped by the permittee in the active management area during that calendar year pursuant to the permit, not to exceed the amount of long-term storage credits in the subaccount. This subsection shall not apply to:

1. A mineral extraction and metallurgical processing permit issued on or before the effective date of this amendment to this section, including any renewal or modification of the permit.

2. A mineral extraction and metallurgical processing permit unless the permittee was engaged in mineral extraction and metallurgical processing within an initial active management area on or before January 1, 2011. END_STATUTE

Sec. 4. Section 45-611, Arizona Revised Statutes, is amended to read:

START_STATUTE45-611. Groundwater withdrawal fee; amounts and purposes of fee; exception

A. Except as provided in subsection B of this section, the director shall levy and collect an annual groundwater withdrawal fee from each person withdrawing groundwater in the Prescott active management area or the person who owns the right to withdraw the groundwater, in an amount not to exceed five dollars $5 per acre-foot of groundwater withdrawn and beneficially used. The director shall levy and collect an annual withdrawal fee from each person withdrawing water, other than stored water, from a well in the Santa Cruz active management area or the person who owns the right to withdraw the water, in an amount not to exceed five dollars $5 per acre-foot of water, other than stored water, that is withdrawn and beneficially used. For the purposes of this article, the annual withdrawal fee levied and collected in the Santa Cruz active management area shall be considered a groundwater withdrawal fee. The actual amount of the fee levied and collected by the director pursuant to this subsection shall be set by the director as follows:

1. For administration and enforcement of this chapter, an amount not less than fifty cents $.50 and not greater than one dollar $1 per acre-foot per year. The initial fee for administration and enforcement shall be levied as soon as practicable after the active management area is established.

2. For augmentation of the water supply of the active management area, conservation assistance to water users within the active management area and monitoring and assessing water availability within the active management area, an amount not greater than two dollars $2 per acre-foot per year.

3. For purchasing and retiring grandfathered rights, an amount not greater than two dollars $2 per acre-foot per year. The initial fee for purchasing and retiring grandfathered rights shall be levied in the first year in which the director develops and implements a program for the purchase and retirement of grandfathered rights as part of the management plan for the active management area, but not earlier than January 1, 2006. The director may not levy a fee under this paragraph on a district member of a groundwater replenishment district that withdraws groundwater in the district for a non‑irrigation use in the district.

B. A person, other than an irrigation district, who withdraws groundwater in an active management area from a non-exempt well for use pursuant to an irrigation grandfathered right that is appurtenant to ten or fewer irrigation acres and the person who owns the right to withdraw the groundwater are exempt from the groundwater withdrawal fee requirements of subsections A and C of this section for those withdrawals unless the irrigation acres are part of an integrated farming operation.

C. Except as provided in section 45‑411.01, subsection C and subsection B of this section, the director shall levy and collect an annual groundwater withdrawal fee from each person who withdraws groundwater in the Tucson, Phoenix and Pinal active management areas or the person who owns the right to withdraw the groundwater, in an amount of not more than five dollars $5 per acre-foot of groundwater withdrawn and beneficially used. The director shall set the actual amount of the fee as follows:

1. In the Tucson and Phoenix active management areas, beginning in 2017, for administration and enforcement of this chapter, an amount of at least fifty cents $.50 but not more than one dollar $1 per acre-foot per year. In the Pinal active management area, beginning in 2017, for administration and enforcement of this chapter, an amount of not more than one dollar $1 per acre‑foot per year.

2. Through 2016, For augmentation of the water supply of the active management area, conservation assistance to water users within the active management area and monitoring and assessing water availability within the active management area, an amount of not more than fifty cents per acre-foot per year, and after 2016, an amount of not more than two dollars $2 per acre‑foot per year. If a permanent board of directors of an active management area water district assumes office under section 48‑4831, the fee for augmentation under this paragraph shall not be levied in that active management area.

3. In the Tucson and Phoenix active management areas, for Arizona water banking purposes, the amount of two dollars fifty cents $2.50 per acre‑foot per year. In the Pinal active management area, through 2016, for Arizona water banking purposes, including replenishment under chapter 15, article 3 of this title, the amount of two dollars fifty cents per acre‑foot per year and, beginning in 2017, for Arizona water banking purposes, including replenishment under chapter 15, article 3 of this title, an amount of not more than two dollars fifty cents $2.50 per acre‑foot per year, except that no fee shall be levied in the Pinal active management area for this purpose during calendar years 2020 through 2026.

4. For purchasing and retiring grandfathered rights, an amount of not more than two dollars $2 per acre-foot per year. The initial fee for purchasing and retiring grandfathered rights shall be levied in the first year in which the director develops and implements a program for the purchase and retirement of grandfathered rights as part of the management plan for the active management area, but not earlier than January 1, 2006. The director may not levy a fee pursuant to this paragraph on a district member of a groundwater replenishment district that withdraws groundwater in the district for non-irrigation use in the district.

5. IN THE PINAL ACTIVE MANAGEMENT AREA, BEGINNING from and after December 31, 2019 THROUGH December 31, 2026, AN AMOUNT OF NOT MORE THAN $2.50 PER ACRE-FOOT PER YEAR FOR GROUNDWATER AND IRRIGATION EFFICIENCY PROJECTS. END_STATUTE

Sec. 5. Section 45-613, Arizona Revised Statutes, is amended to read:

START_STATUTE45-613. Use of withdrawal fees collected for augmentation and conservation and purchase and retirement of grandfathered rights, Arizona water banking purposes and groundwater and irrigation efficiency projects

A. Except as provided in section 45‑615, paragraph 2 and sections 45‑1972 and 48‑4504, monies collected in an active management area for purposes of augmentation, conservation assistance and monitoring and assessing water availability under section 45‑611, subsection A, paragraph 2 and subsection C, paragraph 2 shall be used only to finance the augmentation and conservation assistance programs that are part of the management plan for the active management area and to fund any projects that are authorized by the director for monitoring and assessing water availability within the active management area.

B. Monies collected in an active management area for the purpose of purchasing and retiring grandfathered rights under section 45‑611, subsection A, paragraph 3 and subsection C, paragraph 4 shall be used only to finance the program for the purchase and retirement of grandfathered rights that is part of the management plan for the active management area.

C. Monies collected in an active management area for the purpose of Arizona water banking under section 45‑611, subsection C, paragraph 3 shall be used only for the benefit of the active management area in which they are collected.

D. Except as provided in section 45‑615.01, subsection G, MONIES COLLECTED IN THE PINAL ACTIVE MANAGEMENT AREA FOR THE PURPOSE OF GROUNDWATER AND IRRIGATION EFFIciENCY PROJECTS UNDER SECTION 45-611, SUBSECTION C, PARAGRAPH 5 SHALL BE USED ONLY TO FINANCE PROJECTS FOR THE CONSTRUCTION AND REHABILITATION OF WELLS AND RELATED INFRASTRUCTURE FOR THE WITHDRAWAL AND EFFICIENT DELIVERY OF GROUNDWATER BY IRRIGATION DISTRICTS IN THE PINAL ACTIVE MANAGEMENT AREA.END_STATUTE

Sec. 6. Section 45-615, Arizona Revised Statutes, is amended to read:

START_STATUTE45-615. Deposits; divisions of collections into funds

Except as provided in section 45‑113, subsection C, the director shall deposit, pursuant to sections 35‑146 and 35‑147, all monies collected by the department pursuant to section 45‑611, subsection A, paragraphs 2 and 3 and subsection C, paragraphs 2, 3 and 4 and any other monies received for that purpose. Based on the statement of the director transmitted pursuant to section 45‑614, subsection B, the monies collected shall be allocated as follows:

1. Except as provided in paragraph 2 of this section, monies received for the purpose of augmentation of the water supply of the active management area, conservation assistance to water users within the active management area and monitoring and assessing water availability within the active management area shall be kept in an augmentation and conservation assistance fund. Separate accounts for each active management area shall be maintained within the fund. On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35‑313, and monies earned from investment shall be credited to the fund.

2. If an active management area water district has been established in an active management area, all monies received pursuant to section 45‑611, subsection A, paragraph 2 for the purpose of augmentation of the water supply of that active management area shall be transmitted to the secretary‑treasurer of the district for deposit in the general fund of the district.

3. Monies received for the purpose of purchase and retirement of grandfathered rights shall be kept in a purchase and retirement fund. Separate accounts for each active management area shall be maintained within the fund. On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35‑313, and monies earned from investment shall be credited to the fund.

4. Monies received for the purpose of Arizona water banking shall be deposited, pursuant to sections 35‑146 and 35‑147, in the Arizona water banking fund.

5. Monies collected by the director pursuant to section 45-611, subsection C, paragraph 5 shall be deposited in the temporary groundwater and irrigation efficiency projects fund ESTABLISHED by section 45‑615.01. END_STATUTE

Sec. 7. Title 45, chapter 2, article 11, Arizona Revised Statutes, is amended by adding section 45-615.01, to read:

START_STATUTE45-615.01. Temporary groundwater and irrigation efficiency projects fund; purpose; report; definition

A. The TEMPORARY GROUNDWATER AND IRRIGATION EFFICIENCY PROJECTS FUND IS ESTABLISHED FOR THE PURPOSE OF FUNDING PROJECTS FOR THE CONSTRUCTION AND REHABILITATION OF WELLS AND RELATED INFRASTRUCTURE FOR THE WITHDRAWAL AND EFFICIENT DELIVERY OF GROUNDWATER BY qualified IRRIGATION DISTRICTS IN the PHOENIX active management area, THE PINAL ACTIVE MANAGEMENT AREA AND THE HARQUAHALA IRRIGATION NON-EXPANSION AREA. THE FUND CONSISTS OF legislative APPROPRIATIONS, GROUNDWATER WITHDRAWAL FEES COLLECTED IN THE PINAL ACTIVE MANAGEMENT AREA PURSUANT TO SECTION 45‑611, SUBSECTION C, PARAGRAPH 5, GRANTS FROM FEDERAL AGENCIES AND MONIES DEPOSITED IN THE FUND BY qualified IRRIGATION DISTRICTS IN the PHOENIX active management area, THE PINAL ACTIVE MANAGEMENT AREA AND THE HARQUAHALA IRRIGATION NON‑EXPANSION AREA. GROUNDWATER WITHDRAWAL FEES DEPOSITED IN THE FUND SHALL BE accounted for SEPARATELY FROM OTHER MONIES IN THE FUND AND SHALL BE USED ONLY FOR CONSTRUCTING AND REHABILITATING WELLS AND RELATED INFRASTRUCTURE IN THE PINAL ACTIVE MANAGEMENT AREA. Monies in the fund are continuously appropriated for the purposes of this section.

B. THE DIRECTOR MAY ACCEPT and deposit into the fund MONIES, GRANTS, GIFTS, CONTRIBUTIONS AND DEVISES TO ASSIST IN CARRYING OUT THE PURPOSES OF THIS SECTION.

C. THE DIRECTOR SHALL ADMINISTER THE FUND. ON NOTICE FROM THE DIRECTOR, THE STATE TREASURER SHALL INVEST AND DIVEST MONIES IN THE FUND AS PROVIDED BY SECTION 35-313, AND MONIES EARNED FROM INVESTMENT SHALL BE CREDITED TO THE FUND.

D. THE DIRECTOR MAY GRANT MONIES FROM THE FUND TO qualified IRRIGATION DISTRICTS established pursuant to title 48, chapter 19 IN the PHOENIX active management area, THE PINAL ACTIVE MANAGEMENT AREA AND THE HARQUAHALA IRRIGATION non-expansion area FOR THE PURPOSES DESCRIBED IN SUBSECTION A of this section. In granting monies from the fund, the director may give preference to wells and related infrastructure that would be used to recover stored water. GRANTS MADE TO qualified IRRIGATION DISTRICTS ARE EXEMPT FROM TITLE 41, CHAPTER 24.

E. BEFORE DECEMBER 31 OF EACH YEAR, THE DIRECTOR SHALL SUBMIT TO THE SPEAKER OF THE HOUSE OF REPRESENTATIVES AND THE PRESIDENT OF THE SENATE A WRITTEN REPORT DESCRIBING THE ACTIVITIES OF THE DEPARTMENT FOR THE PRECEDING FISCAL YEAR RELATED TO EXPENDITURES FROM THE FUND. THE REPORT SHALL INCLUDE AN ACCOUNTING FOR EXPENDITURES FROM THE FUND AND HOW THE MONIES WERE USED TO FINANCE PROJECTS FOR THE CONSTRUCTION AND REHABILITATION OF WELLS AND RELATED INFRASTRUCTURE FOR THE WITHDRAWAL AND EFFICIENT DELIVERY OF GROUNDWATER BY qualified IRRIGATION DISTRICTS IN the Phoenix active management area, THE PINAL ACTIVE MANAGEMENT AREA AND THE HARQUAHALA IRRIGATION NON-EXPANSION AREA.

F. EXCEPT AS PROVIDED IN SUBSECTION g OF THIS SECTION, MONIES IN THE FUND ARE EXEMPT FROM THE PROVISIONS OF SECTIONS 35-190 RELATING TO LAPSING OF APPROPRIATIONS.

G. ON JUNE 30, 2027, ANY unencumbered monies IN THE FUND SHALL BE PROPORTIONALLY DISTRIBUTED TO THE FUND'S CONTRIBUTORS BY DECEMBER 31, 2027 ACCORDING TO THE TOTAL AMOUNT OF monies DEPOSITED IN THE FUND BY EACH CONTRIBUTOR. THE PROPORTION OF THE unencumbered MONIES ATTRIBUTABLE TO GROUNDWATER WITHDRAWAL FEES LEVIED UNDER SECTION 45-611, SUBSECTION C, PARAGRAPH 5 SHALL BE DEPOSITED IN THE ARIZONA WATER BANKING FUND ESTABLISHED by SECTION 45-2425 AND SHALL BE USED only in the Pinal active management area IN THE SAME MANNER AS GROUNDWATER WITHDRAWAL FEES COLLECTED IN THE PINAL ACTIVE MANAGEMENT AREA PURSUANT TO SECTION 45-611, SUBSECTION C, PARAGRAPH 3.

H. ALL MONIES DEPOSITED IN THE TEMPORARY GROUNDWATER AND IRRIGATION EFFICIENCY PROJECTS FUND SHALL BE HELD IN TRUST. THE MONIES IN THE FUND MAY BE USED ONLY FOR THE PURPOSES PRESCRIBED IN THIS SECTION AND may NOT BE APPROPRIATED OR TRANSFERRED BY THE LEGISLATURE TO FUND THE GENERAL OPERATIONS OF THIS STATE OR TO OTHERWISE MEET THE OBLIGATIONS OF THE state GENERAL FUND. THIS SUBSECTION DOES NOT APPLY TO ANY TAXES OR OTHER LEVIES THAT ARE IMPOSED PURSUANT TO TITLE 42 OR 43.

I. For the purposes of this section, "qualified irrigation district" means an irrigation district that meets all of the following requirements:

1. The irrigation district received central Arizona project water in any year after calendar year 2014 other than through a groundwater savings facility permit issued under chapter 3.1 of this title.

2. There are at least nine thousand acres that may be lawfully irrigated within the boundaries of the irrigation district and the district did not deliver surface water other than Central Arizona PROJECT water in CALENDAR YEAR 2017.

3. The irrigation DISTRICT submitted an application to the department for monies from the fund established by this section to construct an irrigation efficiency project in the PHOENIX active MANagement area, the Pinal active management area or the Harquahala irrigation non-expansion area. END_STATUTE

Sec. 8. Delayed repeal

Section 45-615.01, Arizona Revised Statutes, as added by this act, is repealed from and after March 31, 2028.

Sec. 9. Section 45-802.01, Arizona Revised Statutes, as amended by Laws 2012, chapter 312, section 2, is amended to read:

START_STATUTE45-802.01. Definitions

Unless the context otherwise requires, the terms defined in section 45‑402 have the same meanings in this chapter and:

1. "Aquifer" means a geologic formation that contains sufficient saturated material to be capable of storing water and transmitting water in usable quantities to a well.

2. "Area of impact" means, as projected on the land surface, the area where the stored water has migrated or is located.

3. "CERCLA" means the comprehensive environmental response, compensation, and liability act of 1980, as amended (P.L. 96‑510; 94 Stat. 2767; 42 United States Code sections 9601 through 9657), commonly known as "superfund".

4. "Constructed underground storage facility" means a facility that meets the requirements of section 45‑811.01 and that is designed and constructed to store water underground pursuant to permits issued under this chapter.

5. "District" means a groundwater replenishment district established under title 48, chapter 27.

6. "District member" means a member of the groundwater replenishment district as provided by title 48, chapter 27.

7. "Electrical district" means a corporate body established pursuant to title 48, chapter 12.

8. "Existing effluent managed underground storage facility" means a managed underground storage facility that meets one of the following conditions:

(a) The facility is operated pursuant to a storage facility permit that the director issued before January 1, 2019 and that authorizes the storage of effluent at the facility.

(b) The facility is operated pursuant to a renewed or modified storage facility permit that the director issued after January 1, 2019 if the facility qualified as an existing effluent managed underground storage facility under subdivision (a), (c) or (d) of this paragraph at any time before the renewal or modification.

(c) The facility is operated pursuant to a permit that the director issued after January 1, 2019 and that authorizes the storage of effluent at a location where the permit holder was authorized to store effluent pursuant to a storage facility permit that the director issued before January 1, 2019.

(d) The facility is operated pursuant to a permit that the director issued after January 1, 2019 and that authorizes the storage of effluent at the facility, and the application to operate the facility was on file with the director as of January 1, 2019.

8. 9. "Groundwater savings facility" means a facility that meets the requirements of section 45‑812.01 in an active management area or an irrigation non‑expansion area at which groundwater withdrawals are eliminated or reduced by recipients who use in lieu water on a gallon‑for‑gallon substitute basis for groundwater that otherwise would have been pumped from within that active management area or irrigation non‑expansion area.

9. 10. "In lieu water" means water that is delivered by a storer to a groundwater savings facility pursuant to permits issued under this chapter and that is used in an active management area or an irrigation non‑expansion area by the recipient on a gallon‑for‑gallon substitute basis for groundwater that otherwise would have been pumped from within that active management area or irrigation non‑expansion area.

10. 11. "Long‑term storage account" means an account established pursuant to section 45‑852.01.

11. 12. "Long‑term storage credit" means stored water that meets the requirements of section 45‑852.01 and that has been credited to a long‑term storage account.

12. 13. "Managed underground storage facility" means a facility that meets the requirements of section 45‑811.01 and that is designed and managed to utilize the natural channel of a stream to store water underground pursuant to permits issued under this chapter through artificial and controlled releases of water other than surface water naturally present in the stream. Surface water flowing in its natural channel is not a managed underground storage facility.

13. 14. "Master replenishment account" means an account established pursuant to section 45‑858.01 for a groundwater replenishment district.

14. 15. "Recipient" means a person who receives in lieu water for use at a groundwater savings facility.

15. 16. "Recoverable amount" means the amount of water, as determined by the director, that will reach the aquifer through water storage.

16. 17. "Replenishment" means the storage of water or use of long‑term storage credits by a groundwater replenishment district to fulfill its duties under title 48, chapter 27, article 3, by a multi‑county water conservation district to fulfill its duties under title 48, chapter 22, article 4 or by an active management area water district to fulfill its duties under title 48, chapter 28, article 7.

17. 18. "Reserve target" has the same meaning prescribed in section 48‑3701.

18. 19. "Storage facility" means a groundwater savings facility or an underground storage facility.

19. 20. "Stored water" means water that has been stored or saved underground pursuant to a storage permit issued under this chapter.

20. 21. "Storer" means the holder of a water storage permit issued pursuant to section 45‑831.01 or a person to whom a water storage permit has been conveyed pursuant to section 45‑831.01, subsection F.

21. 22. "Underground storage facility" means a constructed underground storage facility or a managed underground storage facility.

22. 23. "Water that cannot reasonably be used directly" means water that the storer cannot reasonably put to a direct use during the calendar year, including:

(a) Except as provided in subdivision (b) or except for an agricultural improvement district as provided in subdivision (d), if the storer is a municipal provider, the amount of central Arizona project water that exceeds the amount of mined groundwater withdrawn during the calendar year by the storer in the active management area in which the storer's service area is located. If the storer withdrew mined groundwater during a calendar year in which the storer stored central Arizona project water underground pursuant to the storage permit, the amount of central Arizona project water stored underground during that year equal to the amount of mined groundwater withdrawn from the active management area in which the storer's service area is located shall not be credited to the storer's long‑term storage account but may be considered as being available for recovery by the storer on an annual basis under section 45‑851.01. In calculating the amount of mined groundwater withdrawn by the storer from the active management area, the director, at the request of the storer, shall exclude any groundwater withdrawn, treated and delivered for direct use as part of a remedial action undertaken pursuant to CERCLA or title 49, chapter 2, article 5. For the purposes of this subdivision, "mined groundwater" and "municipal provider" have the same meanings prescribed in section 45‑561.

(b) If the storer is a municipal provider that has been designated as having an assured water supply pursuant to section 45‑576, the amount of central Arizona project water that exceeds the amount of deficit groundwater withdrawn during the calendar year by the storer in the active management area in which the storer's service area is located. If the storer withdrew deficit groundwater during a calendar year in which the storer stored central Arizona project water underground pursuant to the storage permit, the amount of the central Arizona project water stored underground during that year equal to the amount of deficit groundwater withdrawn from the active management area in which the storer's service area is located shall not be credited to the storer's long‑term storage account but may be considered as being available for recovery by the storer on an annual basis pursuant to section 45‑851.01. In calculating the amount of deficit groundwater withdrawn by the storer from the active management area, the director, at the request of the storer, shall exclude any groundwater withdrawn, treated and delivered for direct use as part of a remedial action undertaken pursuant to CERCLA or title 49, chapter 2, article 5. For the purposes of this subdivision, "municipal provider" has the same meaning prescribed in section 45‑561 and "deficit groundwater" means that amount of groundwater withdrawn within an active management area for delivery and use within a service area by a municipal provider in excess of the amount of groundwater that may be withdrawn by the municipal provider consistent with the achievement of the active management area's management goals as prescribed by rules adopted by the director pursuant to section 45‑576.

(c) Except as provided in subdivision (d), if the storer is not a municipal provider, the amount of central Arizona project water stored in an active management area that exceeds the amount of groundwater withdrawn during the calendar year by the storer in that active management area. If the storer withdrew groundwater in an active management area during a calendar year in which the storer stored central Arizona project water underground in that active management area pursuant to the storage permit, the amount of central Arizona project water stored underground during that year equal to the amount of groundwater withdrawn from the active management area shall not be credited to the storer's long‑term storage account but may be considered as being available for recovery by the storer on an annual basis under section 45‑851.01. For the purposes of this subdivision, "municipal provider" has the same meaning prescribed in section 45‑561. In calculating the amount of groundwater withdrawn by the storer from the active management area, the director, at the request of the storer, shall exclude:

(i) The amount of groundwater withdrawn, treated and delivered for direct use as part of a remedial action undertaken pursuant to CERCLA or title 49, chapter 2, article 5.

(ii) The amount of groundwater withdrawn by the storer during the year for mineral extraction and metallurgical processing and delivered during that year for direct use to an irrigation district that is established pursuant to title 48, chapter 19 and that is located in the same active management area from which the amount of groundwater was withdrawn to the extent that the irrigation district or its customers demonstrate a reduction in the amount of groundwater that they otherwise would have withdrawn during that year within the irrigation district.

(iii) The amount of groundwater withdrawn by the storer during the year for mineral extraction or metallurgical processing if the storer was engaged in mineral extraction and metallurgical processing within an initial active management area on or before January 1, 2011.

(d) The amount of central Arizona project water stored in an active management area in any year after 1994 by an agricultural improvement district established pursuant to title 48, chapter 17 for use at those portions of electrical generating facilities that are constructed or expanded after June 12, 1980, subject to both of the following:

(i) If groundwater was used during a year in an active management area at those portions of the electrical generating facilities that were owned and operated by the agricultural improvement district and that were constructed or expanded after June 12, 1980, the amount of the central Arizona project water stored during that year equal to the amount of the groundwater withdrawn during the year for use at those portions of the facilities that were owned and operated by the agricultural improvement district and that were constructed or expanded after June 12, 1980 shall not be credited to the agricultural improvement district's long‑term storage account but may be considered as being available for recovery by the agricultural improvement district on an annual basis under section 45‑851.01.

(ii) Long‑term storage credits accrued as a result of the storage of the central Arizona project water may be recovered within the active management area by the agricultural improvement district only for the purpose of providing central Arizona project water to electrical generating facilities that were owned and operated by the agricultural improvement district and only pursuant to any water requirement included in a facility's certificate of environmental compatibility. Subject to section 45‑854.01, the long‑term storage credits may be assigned by the agricultural improvement district only to the owner of an electrical generating facility for use pursuant to any water requirement included in that facility's certificate of environmental compatibility.

(e) Surface water made available by dams constructed or modified after August 13, 1986.

(f) Until the year 2025:

(i) (f) Effluent.

(ii) (g) If the storage facility is in an active management area, water from outside the active management area that would not have reached the active management area without the efforts of the storer.

(iii) (h) If the storage facility is outside of an active management area, water from outside the groundwater basin in which the storage facility is located that would not have reached the groundwater basin without the efforts of the storer.

(g) (i) Water that is delivered through the central Arizona project and that is acquired by the Arizona water banking authority.

23. 24. "Water storage" means adding water to an aquifer or saving water in an aquifer pursuant to permits issued under this chapter.

24. 25. "Water storage permit" means a permit issued pursuant to section 45‑831.01 to store water at a storage facility. END_STATUTE

Sec. 10. Section 45-802.01, Arizona Revised Statutes, as amended by Laws 2013, chapter 168, section 4, is amended effective from and after December 31, 2024, to read: