Who Benefits from Central Arizona Groundwater Replenishment [Tax] District?


In the recent CAP Forum (April 28, 2010), Cliff Neal, Director of the Groundwater Replenishment District (GRD), stated that only the entities who pay for the water are benefited. I ask you to consider the following facts you decide whether he was telling the truth.

Who does benefit?

First and most obvious, developers benefit; for they are the ones who wrote the law.

In 1995, when the Assured Water Supply rules came into effect, they required two parts: The subdivision has to have a 100-year groundwater supply—down to bedrock or 1,000 feet—underneath the property. Second, any groundwater use has to be replaced with water from a renewable supply. This supply includes surface/river water or effluent.

Along with the rules came two ways to skirt them. If the subdivision is able to join a water company with an Assured Water Supply (AWS) designation, it does not have to meet the first requirement because the water company has to and the area of the provider is averaged, so high water levels one place offset low water levels. Thus dry regions such as the proposed Mission Peaks project in Sahuarita could join the Sahuarita Water Company and satisfy the AWS requirement.

If an AWS water company is not available, to fulfill the second requirement, the subdivision can join the Groundwater Replenishment [Tax] District (GRD) and pay the authorities to recharge renewable water anywhere in the Active Management Area (AMA), which could be, and is, miles away from the area being pumped—down to bedrock or 1,000 feet.

A third item is that a user can be denied a permit if the use does not fit into the management plan. Of course, this power has never been exercised—not even for the 6,000 acre feet (af) for a new mine.

Second, the water users and providers in the central regions where the GRD replenishment water is recharged benefit from a rising water table at someone else’s expense.

When the developers wrote the bill, they made no provision to bring infrastructure to deliver the renewable supplies to the region of the groundwater pumping, nor did they consider the future high cost of GRD water to their customers. Neither did the legislators when they passed the bill into law.

Who does not benefit?

The two categories who pay the tax are Member Lands (homeowners) and Member Service Areas (AWS water companies). No limit is set on future costs for the water for replenishment; therefore, individuals or water companies cannot budget for the future costs of the GRD water.

The “Member Land” homeowners are those who bought a home in a development built in 1995 or after and were not able to join a water company with an assured water supply. How do you know if you fall within the district? Look at your county tax bill to see if there is a GRD assessment. Your water company reports your annual water use to GRD and the County.

Member Service Areas are water companies, either public or private, that have an Assured Water Supply designation, but do not have recharge facilities in the region of hydrological impact. The GRD tax is paid for by all the customers of that company. For example, Tucson Water has 12,500 af of GRD water in their portfolio. With Tucson Water officials forecasting figures of $7,000 af in the future, this could be a sizeable assessment for Tucson Water users.

Currently, Senate Bill SB1141 passed yesterday and was sent to the Governor. It requests another $250 million bonding power for the Central Arizona Water Conservation District, i.e. CAP Project, bringing the total up to $500 million. In the House Water and Energy hearing on February 25 (available on the Internet), the legislative staff and the CAWDC representative clearly stated that the money was for the sake of GRD. Bonds do have the benefit of the spreading the impending high costs over a longer period of time. However, the revenue stream to repay the bonds is without a doubt the Member Lands and customers of Member Service Areas. How much will they have to pay for water they will never receive?

This non-sustainable practice that puts water in the central regions while the water levels are declining in the suburbs is contributed to by State Trust Land Dept. wanting to sell land and Arizona Corporation Commission. Although they claim rates are their major concern, ACC continues to facilitate water companies dependent on GRD water with an unknown cost futures. Further, they will not allow the companies to raise rates to plan for the needed infrastructure to recharge water in the zone of hydrological influence. The water company has to take a loan with interest—but ACC does not allow the rate payers to foot the interest bill. For example, if all the water users of Community Water Company in Green Valley had been paying 50 cents a month on their water bills since the water company bought the CAP allocations in 1985, they would have a pipeline. The CorpComm would not allow it, even though the customers have paid in over a million dollars for the allocations of water they will never see. GO FIGURE!!

I would like to hear from homeowners in GRD Member Lands. What were you told about water when you bought your home?


Nancy Freeman
Groundwater Awareness League

Possible sidebar: areas with potential crises because of the (CA)GRD: Vail, Oro Valley, Sahuarita, Green Valley, Corona de Tucson, Queen Creek, Cave Creek, Apache Junction