SB1181 - 562R

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

Section 1. Section 48-3771, Arizona Revised Statutes, is amended to read:

START_STATUTE48-3771. District replenishment obligations; replenishment location; source of replenishment; exception

A. For each active management area in which member lands or member service areas are or may be located, the district shall replenish groundwater in an amount equal to the groundwater replenishment obligation for that active management area. Except as provided in section 48-3781, subsection G, the district shall complete the replenishment of the groundwater replenishment obligation of that active management area applicable to a particular year within three full calendar years after the year that the district incurs the groundwater replenishment obligation. Replenishment of the groundwater replenishment obligation of an active management area applicable to a particular year is complete when the amount of water added to aquifers through water storage that has been credited directly to the district's conservation district account pursuant to title 45, chapter 3.1, plus long-term storage credits that have been transferred from the district's long-term storage account to its conservation district account pursuant to title 45, chapter 3.1, less the groundwater replenishment obligation of member lands and member service areas located in the active management area and applicable to previous years, less the contract replenishment obligations relative to municipal providers in the active management area for previous years and the year of the calculation, equals or exceeds the groundwater replenishment obligation of the active management area for that year.

B. With respect to the portion of the groundwater replenishment obligation attributable to a parcel of member land or a member service area, the district shall replenish groundwater in the active management area where the parcel of member land or the member service area is located in an amount equal to the groundwater replenishment obligation applicable to that parcel of member land or that member service area.

C. Except as provided by title 45, chapter 3.1, the district may replenish groundwater with central Arizona project water or water from any other lawfully available source except groundwater withdrawn from within an active management area.

D. Notwithstanding any other provision of this chapter, if a parcel of member land is included in the service area of a municipal provider that is not a member service area but that has been designated as having an assured water supply under section 45-576, the following apply:

1. At the option of the municipal provider, the parcel of member land may remain as a parcel of member land and shall retain the replenishment obligation as a member land.

2. If the municipal provider chooses to assume the member land obligation within its designation, that parcel of member land has no parcel replenishment obligation and the district has no groundwater replenishment obligation attributable to that parcel of member land for as long as the designation remains in effect.

E. Notwithstanding any other provision of this chapter, if a parcel of member land is included in the service area of a municipal provider that is a member service area and that has been designated as having an assured water supply under section 45-576, the following apply:

1. At the option of the municipal provider, the parcel of member land may remain as a parcel of member land and shall retain the replenishment obligation as a member land.

2. If the municipal provider chooses to assume the member land obligation within its member service area, that parcel of member land has no further parcel replenishment obligation.

F. If a municipal provider's service area contains member lands and the municipal provider applies to become designated as having an assured water supply under section 45-576, the municipal provider shall notify the district before the final decision and order of designation by the department of water resources whether it chooses to allow the member lands to remain as member lands or chooses to assume the member lands' replenishment obligation under the municipal provider's designation or member service area. After the order of designation is issued, no new member lands may be enrolled within the municipal provider's service area.

G. If a municipal provider chooses to allow the member land to remain member land under this section, the designation of assured water supply shall provide that the member land shall remain member land for ten years after the date of the designation of assured water supply. At the end of the first ten years of the designation of assured water supply, the director of water resources may require in that designation or in any subsequent modification of that designation of assured water supply that parcels of member land within the municipal provider's service area be identified by the municipal provider and reduced by at least one-third by the end of the first five-year period thereafter, by two-thirds at least at the end of the ten-year period thereafter and eliminated entirely by the end of fifteen years thereafter. On identification and reduction of the parcels of member land by the municipal provider, those parcels of member land shall have no further replenishment obligation. this subsection does not prohibit the municipal provider FROM reducing member laNDS BY AMOUNTS GREATER THAN PRESCRIBED BY THIS SUBSECTION. END_STATUTE

Sec. 2. Section 48-3774, Arizona Revised Statutes, is amended to read:

START_STATUTE48-3774. Qualification as member land

A. Real property qualifies as member land only if all of the following apply:

1. Except as provided in section 48-3771, subsection E, the real property is located in an active management area in which a part of the central Arizona project aqueduct is located.

2. The real property is not in a member service area or in a groundwater replenishment district under chapter 27 of this title.

3. The real property is not a water district member land or a parcel of water district member land, or in a water district member service area established under chapter 28 of this title.

4. The conditions stated in section 45-576.01, subsection B, paragraphs 2 and 3 are satisfied with respect to the district at the time of the qualification.

5. The owner of the real property, or other person or entity, such as a property owners' or homeowners' association, if the person or entity has proper authority, records a declaration that has been approved by the district against the real property in the official records of the county where the real property is located that:

(a) Contains the legal description of the real property.

(b) Declares the intent of the owner that the real property qualify as member land under this chapter.

(c) Declares that, in order to permit the delivery of excess groundwater to the real property, each parcel of member land thereafter established at the real property is subject to a parcel replenishment obligation and to a replenishment assessment to be determined by the district.

(d) Declares that qualifying as member land and subjecting the real property to the parcel replenishment obligation and the replenishment assessment directly benefits the real property by increasing the potential of the property to qualify for a certificate of assured water supply issued by the department of water resources pursuant to title 45, chapter 2, article 9, thereby allowing the development, use and enjoyment of the real property.

(e) Contains a covenant that is binding against the real property and each parcel of member land thereafter established at the real property to pay to the district a replenishment assessment based on the parcel replenishment obligation in an amount determined by the district pursuant to section 48-3772, subsection A.

(f) Declares that the district may impose a lien on the real property and each parcel of member land thereafter established at the real property to secure payment of the replenishment assessment and any applicable replenishment reserve fee.

(g) Declares that the covenants, conditions and restrictions contained in the declaration run with the land and bind all successors and assigns of the owner.

B. The declaration may contain covenants, conditions and restrictions in addition to those prescribed by this section. The declaration may be an amendment or supplement to covenants, conditions and restrictions recorded against developed or undeveloped land.

C. Notwithstanding subsection A of this section, no real property qualifies as member land unless the municipal provider that will provide water to the real property that is subject to the declaration records in the official records of the county where the real property is located an agreement between the district and the municipal provider that contains both of the following:

1. The legal description of the real property and the tax parcel numbers for the real property.

2. An agreement by the municipal provider to submit to the district by March 31 of each year after the recordation of the instrument the information prescribed by section 48-3775, subsection A and such other information as the district may reasonably request.

D. Real property previously accepted as member land pursuant to subsection A of this section terminates its member land status only if all of the following apply:

1. No lot or parcel of subdivided land within the real property has been sold or leased to a retail purchaser or lessee.

2. The state real estate commissioner has not issued a public report for the real property.

3. If lot or parcel boundaries were previously recorded for the real property, the planning agency having planning authority over the real property has approved a plat vacating the lot or parcel boundaries that were previously recorded for the real property.

4. The owner or owners of the real property or other person or entity, such as a property owners' or homeowners' association, if the person or entity has proper authority, records a declaration that has been executed by the district and the director of water resources against the real property in the official records of the county where the real property is located and that:

(a) Contains the legal description of the real property that is substantially similar to the legal description of the real property included in the declaration recorded pursuant to subsection A, paragraph 5 of this section.

(b) Declares that the covenants, conditions and restrictions previously recorded pursuant to subsection A, paragraph 5 of this section are revoked.

5. The agreement recorded pursuant to subsection C of this section has been revoked by mutual agreement of the parties to that agreement and the municipal provider has recorded notice of the revocation in the official records of the county where the real property is located.

6. If the department of water resources has issued a certificate of assured water supply for the real property, the director of water resources has revoked the certificate pursuant to a written agreement for revocation entered into between the holder of the certificate and the director.

E. For the purposes of subsection D of this section, a "retail purchaser or lessee" means a purchaser or lessee of a lot or parcel of subdivided lands that is entitled to receive a public report from the seller or lessor pursuant to section 32-2183, subsection I. END_STATUTE

Sec. 3. Applicability

Sections 48-3771 and 48-3774, Arizona Revised Statute, as amended by this act, apply to designations of assured water supply that are issued after the effective date of this act.