state lands; leases; groundwater use.

Plain English Breakdown

The exact fee amount is determined by future department rules and legislative intent regarding fair market value, not fixed in this text.

SB1381: Groundwater Fees and Reporting for State Land Leases

This law requires people who lease state agricultural land outside specific water zones to pay an annual fee based on fair market value and report their groundwater use.

What This Bill Does

• Requires the department to set rules and collect an annual groundwater withdrawal fee from lessees of state agricultural land located outside active management areas or irrigation non-expansion areas for irrigation use.
• Mandates that these lessees submit a yearly report by March 31 detailing their well location, water usage amount, and specific uses of the water.
• Directs that all fees collected under this law be deposited into the fund of the appropriate beneficiary.
• States legislative intent that the fee should reflect the fair market value of the groundwater withdrawn.

Who It Names or Affects

• Lessees holding state land leases designated as agricultural land located outside active management areas or irrigation non-expansion areas who use groundwater for irrigation.
• The department responsible for managing state lands and collecting fees.

Terms To Know

Active Management Area

A term defined in section 45-402 of Arizona law regarding groundwater regulation zones.

Irrigation Non-Expansion Area

A term defined in section 45-402 of Arizona law regarding areas where irrigation expansion is limited.

Limits and Unknowns

• The bill does not specify the exact dollar amount for the fee, only that it should reflect fair market value.
• The specific rules and procedures for collecting fees are to be established by the department later.
• The text does not list penalties for failing to pay the fee or submit the required report.

Official Summary Text

SB1381 - state lands; leases; groundwater use.

Current Bill Text

SB1381 - 572R - I Ver

REFERENCE TITLE:
state lands; leases; groundwater use.

State of Arizona

Senate

Fifty-seventh Legislature

Second Regular Session

2026

SB 1381

Introduced by

Senators
Sundareshan: Alston, Bravo, Diaz, Epstein, Fernandez, Gabald�n, Gonzales,
Hatathlie, Kuby, Miranda, Ortiz, Sears

AN
ACT

amending title 37, chapter 2, article 4,
Arizona Revised Statutes, by adding section 37-292; relating to state
lands leases.

(TEXT OF BILL BEGINS ON NEXT PAGE)

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

Section
1.
Title
37, chapter 2, article 4, Arizona Revised Statutes, is amended by adding
section 37-292, to read:

START_STATUTE
37-292.

Groundwater
withdrawal fee; agricultural land; annual report; fee deposits; definitions

A. The
department shall establish by rule and collect an annual groundwater withdrawal
fee from each lessee of state land that is agricultural land and that is
located outside of an active management area or an irrigation non-expansion
area for the irrigation use of groundwater.

B. On or
before March 31 of each year, a lessee of state land that is agricultural land
and that is located outside of an active management area or an irrigation non-expansion
area shall report the following information to the department:

1. The
location of the well.

2. The
quantity of groundwater withdrawn from the well during the previous calendar
year.

3. The
specific uses to which the groundwater was applied during the previous calendar
year.

C. Fees
collected pursuant to this section shall be deposited in the fund of the
appropriate beneficiary.

D. For
the purposes of this section:

1. "Active
management area" has the same meaning prescribed in section 45-402.

2. "Irrigation
non-expansion area" has the same meaning prescribed in section 45-402.

3. "Irrigation
use" has the same meaning prescribed in section 45-402, paragraph
23, subdivision (
a
).
END_STATUTE

Sec.
2.

Legislative intent

The
legislature intends that it is in the best interest of the state land trust for
the annual groundwater withdrawal fee adopted pursuant to section 37-292,
Arizona Revised Statutes, as added by this act, to reflect the fair market
value of the groundwater withdrawn.