By Howard Fischer
Mail | X: @azcapmedia

PHOENIX — A judge won’t back down — even temporarily — from his ruling that state water officials acted illegally in changing the rules for home builders.

In a new order, Maricopa County Superior Court Judge Scott Blaney rejected claims by Bo Dul, an attorney for the Department of Water Resources, that his ruling was likely to be overturned on appeal and therefore he should not enter a final order against the agency.

The judge was no more sympathetic to arguments by Dul that homebuyers will suffer “irreparable damage” if the agency cannot enforce the rule that he invalidated. That is based on the agency’s claim it could result in DWR allowing some homes to be built and sold that really don’t have a 100-year assured water supply required by state law.

“That is the exact harm the Groundwater Management Act was designed to prevent,” she wrote.

Blaney was not impressed.

“The defendants’ concerns are not consistent with the facts,” the judge wrote in his new order. He said all his ruling does is require DWR to use the rules that were in place during 2023 to determine where homes can and cannot be built — before the agency adopted the new policies that Blaney ruled in April were not done properly.

The new order most immediately affects efforts by developers to build homes in some communities on the edge of the Phoenix area. That was halted when the agency decided, using its new — and now invalidated — policy, that there is not a 100-year supply of water in the hydrological basin.

But there are broader implications going forward.

The order reaffirms Blaney’s conclusion that DWR is not free to make what he considered to be a significant change in the rules about where residential development can occur without going through the legal process, one that requires public hearings and other input. That effectively puts the agency on notice that it should not make any future efforts to bypass the rulemaking process when it decides where homes can be built in all areas of the state under its purview.

More immediately, unless overturned, it limits the future ability of DWR to decide to curb home construction in other areas of the state based on its now-invalidated rules on how it wants to determine if there is sufficient groundwater.

And that is likely to take on more significance as the state loses much of its Colorado River supply and some communities are forced to tap into groundwater.

At the center of the issue is the requirement that developers seeking to build in “active management areas” of the state — there are eight — must show there is sufficient water, generally defined as enough to serve the project for at least 100 years. That is a touchstone of the historic 1980 Groundwater Code.

That requirement is generally met by building within a city or a water company service area that already has its own certificate of assured water supply.

But outside those areas, developers had to show they had their own access.

In 2023, however, DWR decided it would deny the necessary permission for those developers if the agency’s modeling showed that there is not a 100-year water supply — not just at the property but anywhere in the active management area. And it concluded the water in the entire 5,600-square-miles Phoenix AMA could be guaranteed for only 96 years.

The agency also found there were places in the basin where it would require drilling to more than 1,000 feet to access water.

Based on that new policy, the agency stopped issuing certificates in areas of Queen Creek and Buckeye where permits had not yet been issued.

It was that change in policy that led the Homebuilders Association of Central Arizona to sue — and to Blaney’s ruling earlier this year finding the change was illegally enacted because it was unilateral and did not go through public hearings.

In her latest filings, Dul told Blaney he should delay his decision and leave the policy in place — and the limits on construction — while DWR seeks review at the Court of Appeals.

She said the agency did nothing wrong, saying despite his ruling it did not amount to a change in the rules.

Dul said DWR has always been required to consider the effect on “all existing users” of groundwater throughout the basin and not just at the specific site.

Anyway, Dul said, the 2023 change came after “improved modeling” showed that groundwater supplies in the basin already were overallocated. And she said further studies showed there were areas where that 1,000-foot rule to access water could not be met.

“An agency does not ‘change’ its rule by considering updated technology and data,” Dul told Blaney.

Attorney Sean Hood representing the homebuilders said that is misstating the issue. He said Blaney’s earlier ruling does not require DWR to disregard updated data.

What it does do, Hood said, is tell the agency it can’t simply decide that a development in one area can’t be built simply because DWR decided — without making formal rules — that it was now going to consider the availability of water anywhere in the basin.

He also rejected the agency’s contention it will be forced to issue certificates for development where there is no assured water supply.

“It simply cannot do so by applying the unlawful AMA-wide rules,” Hood said.

That reflected what Blaney already had decided.

“A government agency cannot be allowed to rationalize a new rule by camouflaging it as just a new implementation of an old rule,” the judge wrote in his earlier ruling.

At this point, it is only the Phoenix AMA where the agency has done those basin-wide studies and attempted to halt development based on its conclusion there just isn’t enough water in the ground to meet that 100-year supply.

But future studies of other AMAs, including in Pima, Pinal, Santa Cruz and Prescott, also could lead to the same conclusions that the unavailability of a 100-year supply anywhere in the basin can limit all construction outside of cities and water company service areas.

Unless overturned, Blaney’s decision also would bar any unilateral action by DWR to halt development in those other AMAs, something that could become an issue with the loss of Colorado River water.