Back to Arizona

SB1176 • 2026

stormwater storage; replenishment credits

SB1176 - stormwater storage; replenishment credits

Water
Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor
Warren Petersen
Last action
2026-03-05
Official status
House second read
Effective date
Not listed

Plain English Breakdown

The effective date is listed in the bill text but not specified with a calendar date; it becomes effective on the general effective date for this session.

Stormwater Storage and Replenishment Credits

This law allows water storers in the Phoenix Active Management Area to earn credits by storing stormwater underground to help meet their required groundwater replenishment duties.

What This Bill Does

  • Allows a storer to recharge collected rain runoff into an approved constructed underground storage facility and receive a credit for it.
  • Requires the Director of Water Resources to give the storer a credit equal to 95 percent of the total stormwater volume stored in the previous calendar year.
  • Lets storers use these credits or transfer them to other eligible entities to pay off their yearly groundwater replenishment obligations within the same subbasin.
  • Limits where credits can be used by requiring that any offset must happen near a well located within two miles of the storage facility, or served by a water provider whose service area is partly within two miles of the facility.
  • Defines stormwater as rain runoff collected from streets, sidewalks, gutters, and other impervious surfaces to a retention location, while excluding surface water, effluent, incidental recharge, or net natural recharge.

Who It Names or Affects

  • Storers operating in the Phoenix Active Management Area
  • The Director of the Arizona Department of Water Resources (ADWR)
  • Eligible entities that may receive transferred replenishment credits

Terms To Know

Replenishment credit
A record kept by ADWR representing stored stormwater treated as groundwater, which can be used to meet legal replacement duties.
Stormwater
Rainfall runoff collected from streets, sidewalks, gutters, and other impervious surfaces designed for water retention.
Phoenix Active Management Area (AMA)
The specific geographic region where this law allows stormwater storage to earn credits.

Limits and Unknowns

  • Credits can only offset replenishment obligations within the same subbasin and near facilities located two miles from the storage site.
  • Storers must hold valid water storage permits, constructed underground facility permits, and all required water quality permits before storing stormwater.

Amendments

These notes stay tied to the official amendment files and metadata from the legislature.

Plain English: This amendment adds a rule that prevents local governments from claiming they are neutral on laws if their leaders have already voted to support or oppose those same laws.

  • It requires a majority vote of the city, town, or county governing body before they can advocate for a neutral position on legislation.
  • The amendment text does not explain what happens if this rule is broken.
  • The full context of 'Subsection A' mentioned in the text is missing from the provided material, so it is unclear exactly how previous positions are defined or recorded.

Plain English: This amendment stops people from lobbying the state legislature for a city, town, or county unless that local government has officially voted on and recorded its position first.

  • Local governments must vote by majority to approve an official stance before anyone can lobby about it.
  • The official position must be written down in public records like meeting minutes.
  • Lobbyists cannot claim they represent a local government if these rules are not followed.
  • This amendment completely replaces the original bill, which was about stormwater storage and credits, so it changes the entire purpose of the legislation to focus only on lobbying rules.
  • The text does not explain what happens if a lobbyist breaks these rules other than they cannot say they represent the local government.

Bill History

  1. 2026-03-05 House

    House second read

  2. 2026-03-04 House

    House Rules: None

  3. 2026-03-04 House

    House Appropriations: HELD

  4. 2026-03-04 House

    House Natural Resources, Energy & Water: W/D

  5. 2026-03-04 House

    House first read

  6. 2026-02-27 House

    Transmitted to House

  7. 2026-02-26 Senate

    Senate third read passed

  8. 2026-02-23 Senate

    Senate minority caucus

  9. 2026-02-23 Senate

    Senate majority caucus

  10. 2026-02-23 Senate

    Senate consent calendar

  11. 2026-01-21 Senate

    Senate second read

  12. 2026-01-20 Senate

    Senate Rules: PFC

  13. 2026-01-20 Senate

    Senate Regulatory Affairs and Government Efficiency: DP

  14. 2026-01-20 Senate

    Senate Natural Resources: W/D

  15. 2026-01-20 Senate

    Senate first read

Official Summary Text

SB1176 - 572R - Senate Fact Sheet

Assigned to
RAGE����������������������������������������������������������������������������������������������������������������� FOR
COMMITTEE

ARIZONA STATE SENATE

Fifty-Seventh
Legislature, Second Regular Session

FACT SHEET FOR
S.B. 1176

stormwater storage;
replenishment credits

Purpose

Allows a storer
in the Phoenix Active Management Area (AMA) to recharge stormwater within a
constructed underground storage facility pursuant to outlined requirements and
permits and receive a replenishment credit. Allows a storer to use
replenishment credits or transfer the replenishment credits to any other
eligible entity and offset an equal amount of the storer's replenishment
obligation within the same subbasin for any year.

Background

Current statute
allows a person to apply to the Director of the Arizona Department of Water
Resources (ADWR) for a water storage permit and store water at a storage
facility only pursuant to a water storage permit. The Director of ADWR may
issue a water storage permit to store water at a storage facility if: 1) the
applicant has a right to use the proposed source of water; 2) the applicant has
applied for any water quality permit required by the Arizona Department of
Environmental Quality and by federal law; and 3) the water storage will occur
at a permitted storage facility. The Director of ADWR may only issue a water
storage permit for up to 50 years unless statutorily outlined exceptions apply
(
A.R.S.
� 45-831.01
).

Multi-county
water conservation districts and AMA water districts may replenish groundwater
with Central Arizona Project water or water from any other lawfully available
source except groundwater withdrawn from within an AMA (A.R.S. ��
48-3771

and
48-4972
).

Replenishment
is the storage of water or use of long-term storage
credits by a groundwater replenishment district, a multi-county water
conservation district or an AMA water district to fulfill their statutorily
outlined duties (
A.R.S.
� 45-802.01
).

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

Provisions

1.

Allows a storer in the Phoenix AMA to recharge stormwater within a
constructed underground storage facility pursuant to the operational terms of
the water storage and constructed underground storage facility permits and in
compliance with all applicable water quality permits and receive a
replenishment credit.

2.

Requires the Director of ADWR to annually determine the quantity of
stormwater recharged by a storer and credit the storer's replenishment credit
account with 95 percent of the total volume of recharged stormwater in the
previous calendar year.

3.

Requires the Director of ADWR to maintain a record of earned and
transferred replenishment credits for each credit holder and debit credits from
the holder's account equal to the amount of credits used.

4.

Allows a storer to use replenishment credits or transfer the
replenishment credits to any other eligible entity and offset an equal amount
of the storer's replenishment obligation within the same subbasin for any year.

5.

Allows
a storer to use replenishment credits to offset the storer's replenishment obligation
if the offset is for:

a)

groundwater withdrawn from a well within two miles of the constructed
underground storage facility where the replenishment occurred; or

b)

groundwater
withdrawn and served by a water provider within the water provider's service
area and a portion of the service area is located within two miles of the
constructed underground storage facility where the replenishment occurred.

6.

Allows the Director of the ADWR to issue a permit to an underground
storage facility solely for the storage of stormwater or for a combination of
water sources.

7.

Requires the Director of ADWR to treat replenishment credits as
groundwater and not as stored water.

8.

Adds to the conditions that allow the Director of ADWR to issue a water
storage permit that the proposed source of water is stormwater that will be
recharged for aquifer replenishment in a constructed underground storage
facility.

9.

Stipulates that the storage of stormwater does not affect, infringe on
or interfere with vested or existing rights to the use of water.

10.

Defines

stormwater
as water that has been collected in a system designed to
carry rainfall runoff from streets, sidewalks, gutters and other impervious
surfaces, including those in subdivisions, to a location where the water is
retained.

11.

Stipulates
that stormwater does not include surface water, effluent, incidental recharge
or net natural recharge.

12.

Makes
technical changes.

13.

Becomes
effective on the general effective date.

Prepared by Senate Research

January 22, 2026

SB/hk

Current Bill Text

Read the full stored bill text
SB1176 - 572R - S Ver

Senate Engrossed

stormwater storage;
replenishment credits

State of Arizona

Senate

Fifty-seventh Legislature

Second Regular Session

2026

SENATE BILL 1176

AN
ACT

amending section 45-831.01, arizona
revised statutes; amending title 45, chapter 3.1, article 3, Arizona Revised
Statutes, by adding section 45-837.01; relating to water storage.

(TEXT OF BILL BEGINS ON NEXT PAGE)

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

Section 1. Section 45-831.01, Arizona Revised
Statutes, is amended to read:

START_STATUTE
45-831.01.

Water storage permits

A. A person may apply to the director for a water
storage permit and may store water at a storage facility only pursuant to a
water storage permit.

B. The director may issue a water storage permit to
store water at a storage facility if the director determines that all of the
following apply:

1. The applicant has a right to use the proposed
source of water
or the PROPOSED source of water is STORMWATER
as defined in section 45-837.01

that will be RECharged for aquifer REPLENISHMENT in a CONSTRUCTED
underground storage fACILITY PURSUANT to section 45-837.01
. Any
determination made by the director for purposes of this subsection regarding
the validity, nature, extent or relative priority of a water right claimed by
the applicant or another person is not binding in any other administration
proceeding or in any judicial proceeding.

2. The applicant has applied for any water quality
permit required by the department of environmental quality under title 49,
chapter 2, article 3 and by federal law.

3. The water storage will occur at a permitted
storage facility.

C. In addition to the requirements of subsection B
of this section, if the applicant has applied for a water storage permit to
store water at a groundwater savings facility, the director shall not issue the
water storage permit unless the applicant has agreed in writing to comply with
the plan by which the quantity of groundwater saved at the facility will be
proved each year.

D. If the director issues a water storage permit,
the director may make, if possible, the following determinations:

1. Whether the water to be stored is water that
cannot reasonably be used directly by the applicant and otherwise meets the
requirements of section 45-852.01 for long-term storage credits.

2. If use of the water to be stored is appurtenant
to a particular location, and if so, where the water may be legally used after
recovery. Any determination made by the director for purposes of this
subsection regarding the validity, nature, extent or relative priority of a
water right claimed by the applicant or another person is not binding in any
other administrative proceeding or in any judicial proceeding.

E. The director may issue a water storage permit for
a period of not more than fifty years, except that:

1. On request of the holder of the permit, the
director may renew the permit if the director determines that the requirements
of subsection B of this section apply and, if the requirement of subsection C
of this section applied at the time of issuance, that the requirement of
subsection C of this section applies at the time of renewal.

2. Subject to the provisions of this chapter, the
holder of long-term storage credits earned pursuant to the permit may
recover the water over a period longer than the duration of the permit.

F. The holder of a water storage permit may apply to
the director for approval to convey the permit to another
person. The director may approve the conveyance if the director
determines that the person to whom the permit is to be conveyed and the water
storage will continue to meet the applicable requirements of this
section. If long-term storage credits accrued pursuant to the
water storage permit are being assigned pursuant to section 45-854.01
with the water storage permit, the director shall be given notice of the
impending assignment of long-term storage credits at the time the holder
of the water storage permit applies to convey the permit.

G. A person who holds a water storage permit may
apply to the director on a form approved by the director for a modification of
that water storage permit. The director may modify the permit within
twenty days
of

after
receiving the
application without complying with section 45-871.01 if all of

the following apply:

1. The holder of the storage facility permit with
which the water storage permit is affiliated has consented to the modification.

2. The modification to the water storage permit does
not require a modification of the affiliated water storage facility permit.

3. The only modification requested is to add an
amount of Colorado river water as a type of water to be stored under the water
storage permit.

4. Water storage of Colorado river water has
previously been permitted at the affiliated storage facility.

5. The person requesting the modification has the
right to use the Colorado river water.

H. A water storage permit shall include the
following information:

1. The name and mailing address of the person to
whom the permit is issued.

2. The storage facility where the water storage will
occur and the name of the active management area, irrigation non-expansion
area, groundwater basin or groundwater
sub-basin

subbasin
, as applicable, in which that facility is located.

3. The maximum annual amount of water that may be
stored.

4. If the applicable finding of subsection D of this
section has been made, whether the water to be stored is water that cannot
reasonably be used directly by the applicant.

5. If the applicable finding of subsection D of this
section has been made, any restrictions on where the water to be stored may
legally be used.

6. Other conditions consistent with this chapter.

7. The duration of the permit.

I. If the water
storage will occur at a groundwater savings facility, the water storage permit
shall include, in addition to the information required by subsection H of this
section, the requirements of the plan by which the quantity of groundwater
saved at the storage facility will be proved each year.

J. If the director of the department of water
resources decides to issue a water storage permit and the applicant has not
received a water quality permit required by the department of environmental
quality under title 49, chapter 2, article 3 and by federal law, the director
of the department of water resources shall make receipt of the water quality
permit a condition of the water storage permit and the holder of the water
storage permit shall not store water until receiving the water quality permit.
END_STATUTE

Sec. 2. Title 45, chapter 3.1, article 3,
Arizona Revised Statutes, is amended by adding section 45-837.01, to read:

START_STATUTE
45-837.01.

Stormwater storage; replenishment credits; definition

A. a storer
in
the phoenix active management area

may recharge stormwater within a constructed underground storage
facility pursuant to the operational terms of the water storage and constructed
underground storage facility permits and in compliance with all applicable
water quality permits and receive a replenishment credit.

b. The Director shall annually
determine the quantity of stormwater recharged by a storer AND shall credit the
storer's replenishment credit account with ninety-five percent of the total
volume of recharged stormwater in the previous calendar year.� The Director
shall maintain a record of earned and transferred replenishment credits for
each credit HOLDER AND shall debit credits from the holder's account equal to
the amount of credits used.

C. a storer may use Replenishment
credits or TRANSFER the CREDITS to any other eligible entity and offset an
equal amount of the storer's replenishment obligation within the same subbasin
for any year.� a storer may use REPLENISHMENT credits to offset the storer's
REPLENISHMENT
obligation if the offset is for either:

1. groundwater withdrawn from a well
within two miles of the constructed underground storage facility where
replenishment occurred.

2. groundwater withdrawn and served
by a water provider within the water provider's service area and a portion of
the service area is located within two miles of the constructed underground
storage facility where the replenishment occurred.

D. The director shall treat
REPLENISHMENT credits as GROUNDWATER AND NOT as stored water.

E. Notwithstanding any other law, the
director may issue a permit to an underground storage facility solely for the
storage of stormwater as provided in this section or for a combination of water
sources.

F. THE STORAGE OF STORMWATER PURSUANT
TO THIS SECTION does NOT AFFECT, INFRINGE ON OR INTERFERE WITH VESTED OR
EXISTING RIGHTS TO THE USE OF WATER.

G. FOR THE PURPOSES OF THIS SECTION,
"STORMWATER":

1. Means water that has been
collected in a system designed to carry rainfall RUNOFF FROM STREETS,
SIDEWALKS, GUTTERS AND OTHER IMPERVIOUS SURFACES, INCLUDING THOSE IN
SUBDIVISIONS, TO A LOCATION WHERE THE WATER IS RETAINED.

2. DOES NOT INCLUDE SURFACE WATER,
EFFLUENT, INCIDENTAL RECHARGE AS DEFINED IN SECTION 45-561 OR NET NATURAL
RECHARGE AS DEFINED IN SECTION 48-4401.
END_STATUTE