HB2441 - 561R - Senate Fact Sheet

Purpose

An emergency measure that requires a city or town that provides water service in a county with a population of more than 500,000 persons to provide water for a period of at least three years by use of a standpipe for water hauling to residences that are outside the city's or town's water service area if outlined conditions are met.

Background

In 2022, the U.S. Bureau of Reclamation declared a Tier 1 shortage on the Colorado River. This shortage resulted in a substantial cut to Arizona's share of Colorado River water allocations (CAP). In 2023, the Lower Colorado River Basin entered into a Tier 2A shortage, requiring further cuts to water allocations throughout the Colorado River Basin states (CAP).

According to the City of Scottsdale's Drought Management Plan (Scottsdale DMP), if a Tier 1 or Tier 2A shortage has been triggered, any water hauling operations must cease unless the water hauling customer, whether residential or commercial, can prove indisputably that the hauled water is being supplied directly to a City of Scottsdale resident or business (Scottsdale DMP).

A municipal water provider is a city, town, domestic water improvement district, private water company or irrigation district that supplies water for non-irrigation use (A.R.S. § 48-5901). A service area with respect to a city or town, is the area of land actually being served water, for non-irrigation use, by the city or town (A.R.S. § 45-402).

There is no anticipated fiscal impact to the state General Fund associated with this legislation.

Provisions

1. Requires a city or town that provides water service in a county with a population of more than 500,000 persons to provide water for a period of at least three years by use of a standpipe for water hauling to residences that are outside the city's or town's water service area if:

a) the number of residences to be served does not exceed 750, and the residences are in an area that is an unincorporated community within the county and adjacent to the city or town;

b) the city or town previously provided standpipe service to water haulers that deliver water to the residences and the city or town ceased providing that service pursuant to a drought management plan adopted by the city or town;

c) there is no other source of water for those persons within 10 miles of their residences; and

d) the city or town is reimbursed for the full reasonable costs of providing the water.

2. Requires the city or town to not charge residences for water-related costs, expenses and
acre-feet of water that do not provide a direct benefit to the residences.

3. Requires a city or town that provides water, either directly or by way of contract with one or more third party, to:

a) allow water to be received at the standpipe and delivered through water haulers that have established a water hauling account with the city or town or its contractors;

b) bill and collect from the water haulers the reasonable cost of providing the water to the standpipe, not exceeding $7 per each 1,000 gallons; and

c) provide annually at least 150 acre-feet of water to the standpipe.

4. Requires a city or town that provides water at a standpipe to disclose to the public the source of water that is provided through the standpipe.

5. Exempts a city or town that provides water from liability for any actions taken or omissions after water is provided at the standpipe.

6. Prohibits a city or town that provides water from reducing or suspending the amount of water for any reason except if the city or town has disclosed the source of the water and that source has been reduced or suspended by a proportionate amount outside the city's or town's control.

7. Requires a city or town drought management plan to include the option for the city or town to enter into contracts with private entities, including private water companies, to ensure the integration of stable and secure water supplies.

8. Exempts a city or town from liability to any person or entity for providing or failing to provide water.

9. Excludes standpipe service from being considered a utility service.

10. Stipulates that the requirement for a city or town to provide water service outside a city or town does not preclude the execution or implementation of a voluntary agreement before the effective date.

11. Repeals the requirement for a city or town to provide water service outside a city or town on January 1, 2026.

12. Becomes effective on signature of the Governor, if the emergency clause is enacted.