HB2309 - 542R

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

Section 1. Section 45-411.01, Arizona Revised Statutes, is amended to read:

START_STATUTE45-411.01. Exemptions from irrigation water duties, conservation requirements for distribution of groundwater and portions of groundwater withdrawal fee for portions of Phoenix active management area; fee; review

A. Each person who is entitled to use groundwater pursuant to an irrigation grandfathered right under article 5 of this chapter on irrigation acres located within the area delineated for exemption under subsection E of this section is exempt, beginning January 1, 1989 through December 31, 2024 2034, from any irrigation water duties or intermediate water duties established or required to be established for those irrigation acres in the management plans for the first, second, third, fourth and fifth management periods for the Phoenix active management area adopted pursuant to article 9 of this chapter.

B. The Arlington canal company, the Buckeye water conservation and drainage district and the St. John's irrigation district, or their successors, are exempt, beginning January 1, 1989 through December 31, 2024 2034, from any applicable conservation requirements for the distribution of groundwater established in the management plans for the first, second, third, fourth and fifth management periods for the Phoenix active management area adopted pursuant to article 9 of this chapter.

C. No groundwater withdrawal fee shall be levied or collected pursuant to section 45‑611 and no water quality assurance fee shall be levied or collected pursuant to section 45‑616 for:

1. Groundwater withdrawn during calendar years 1989 through 2024 2034 for irrigation use on irrigation acres within the area exempted from irrigation water duties and intermediate water duties under subsection A of this section.

2. Groundwater withdrawn and used in the area delineated for exemption under subsection E of this section during calendar years 1999 through 2024 2034 for a non‑irrigation use pursuant to section 45‑519, subsection B, if the user of the groundwater pays a fee of five hundred dollars $500 to the director by March 31 of each year following a year in which the groundwater was used. The director shall deposit, pursuant to sections 35‑146 and 35‑147, the monies collected under this paragraph in the water quality assurance revolving fund established by section 49‑282.

D. Except as provided in subsection G of this section, a water duty exemption fee of twenty‑five cents $.25 per irrigation acre per year shall be paid to the department for each irrigation acre in the exempted area. The water duty exemption fee shall be paid to the department no not later than March 31 of each year from 1990 through 2025 2035 for the preceding year by each person who owns irrigation acres within the exempted area as of December 31 of the year preceding the date the payment is due except that, if the Arlington canal company, the Buckeye water conservation and drainage district or the St. John's irrigation district, or a successor, delivers water to the irrigation acres during the year preceding the date payment is due, the fee shall be paid by the company or district delivering water to the irrigation acres. If a person who is required to pay a fee pursuant to this subsection fails to pay the fee for the calendar year in question on or before March 31 of the following year, the director may assess and collect a penalty of ten percent of the unpaid fee, without compounding, for each month or portion of a month that the fee is delinquent. The total penalty assessed under this subsection shall not exceed sixty percent of the unpaid fee. The director shall deposit, pursuant to sections 35‑146 and 35‑147, all monies collected by the department under this subsection in the water resources fund established by section 45‑117.

E. The boundaries of the exempted area under this section are delineated on a map of the Phoenix active management area filed in the office of the secretary of state on May 12, 1988. A true copy of the map filed in the office of the secretary of state shall be on file in the department and shall be available for examination by the public during regular business hours.

F. The director shall review the hydrologic conditions within the area delineated on the map filed in the office of the secretary of state pursuant to subsection E of this section. The director shall consult with representatives of the Arlington canal company, the Buckeye water conservation and drainage district and the St. John's irrigation district, or their successors, and all cities and towns within the exempted area, on the scope of the review before beginning the review and on the status of the review periodically during the course of the review. The director shall submit a recommendation to the governor, the president of the senate and the speaker of the house of representatives no not later than December november 15, 2019 2031 regarding extending the exemptions established in this section.

G. A person who owns an irrigation grandfathered right appurtenant to ten or fewer irrigation acres located in the exempt area is exempt from the payment of a water duty exemption fee for the acres prescribed by subsection D of this section unless the irrigation acres are part of an integrated farming operation. The exemption provided by this subsection does not apply to the Arlington canal company, the Buckeye water conservation and drainage district or the St. John's irrigation district, or any successor, in any year in which the company or district delivers water to the irrigation acres.END_STATUTE

Sec. 2. Section 45-519, Arizona Revised Statutes, is amended to read:

START_STATUTE45-519. Drainage water withdrawal permit; conditions for issuance

A. A person may apply for and the director may issue a drainage water withdrawal permit if the director determines that drainage of irrigated lands is necessary for a reasonable economic return from agricultural production in respect to those lands and the withdrawal of such groundwater is consistent with the management plan and achievement of the management goal for the active management area.

B. The holder of a permit issued under subsection A of this section may:

1. Use groundwater withdrawn pursuant to the permit for a non‑irrigation use if the person holds a non-irrigation grandfathered right pursuant to article 5 of this chapter, a general industrial use permit pursuant to section 45‑515 or a service area right pursuant to article 6 of this chapter.

2. Convey groundwater withdrawn pursuant to the permit to another person for a non-irrigation use if the person receiving the groundwater holds a non-irrigation grandfathered right pursuant to article 5 of this chapter, a general industrial use permit pursuant to section 45‑515 or a service area right pursuant to article 6 of this chapter.

C. When determining compliance with the applicable conservation requirements established pursuant to sections 45‑565, 45‑565.01, 45‑566, 45‑566.01, 45‑567, 45‑567.01, 45‑568 and 45‑568.01, the director shall account for groundwater withdrawn pursuant to a permit issued pursuant to subsection A of this section as surface water if the groundwater is withdrawn before January 1, 2025 2035 from within the boundaries of the exempted area prescribed by section 45‑411.01, subsection E and is used pursuant to subsection B of this section at a turf related facility or riparian habitat within the exempted area. The director shall cease accounting for the groundwater as surface water on expiration of the exemptions provided for in section 45‑411.01 or on termination of the permit, whichever occurs first.

D. The director shall monitor withdrawals of groundwater pursuant to a drainage water withdrawal permit and shall terminate the permit if the conditions for issuance specified in subsection A of this section no longer apply. A permit issued pursuant to this section may be renewed subject to the same criteria used in granting the original permit. END_STATUTE