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NAIOP Arizona Hosts Program on Arizona’s Water Supply

The Arizona Chapter of NAIOP in September hosted an educational program on Arizona’s water supply designed to educate members of the commercial real estate development association on the facts and myths surrounding how availability of water could impact future growth.

Grady Gammage, Jr., land use attorney and water expert from Gammage & Burnham law firm; Jeff Gray, Legislative Affairs Manager at the Central Arizona Project (CAP), and Carol Ward, Assistant Deputy Director for Water Planning at the Arizona Department of Water Resources (ADWR) shared their expertise in a panel moderated by Sarah Porter, Director of the Kyl Center for Water Policy at ASU’s Morrison Institute for Public Policy.

The event was held at the E-Center at the Esplanade courtesy of LBA Realty. CBRE sponsored the program and Commercial Executive Magazine was the media sponsor for this special event, which is part of NAIOP Arizona’s Market Leader Series.

Porter kicked off the program with an overview of water supply, demand, and use trends. The Metro Phoenix water supply comes from four major sources: groundwater (34%), effluent (12%), Salt and Verde rivers (25%) and the CAP (29%). The CAP brings in Colorado River water, which is what is being curtailed under the Drought Contingency Plan (DCP) due to lower water levels at Lake Mead.

As the population has grown, more land has shifted from agriculture to municipal use (houses, businesses, etc.) which consumes far less water per acre. As a result, Arizona is now using the same amount of water as it was in 1957 despite a more than 7-fold increase in population.

However, agriculture remains the largest user of water in Arizona. Statewide, agriculture uses 70% of all water but makes up less than 7% of the state’s economy. In Metro Phoenix, agriculture uses 30%; municipalities use 50%. Agriculture is the only usage being curtailed in the Tier 1 shortage under the DCP, most of this being in Pinal County.

Gray described the legal framework that determines when the Colorado River hits different shortage levels and which users have priority rights. The users experiencing current Tier 1 and possible future Tier 2 cuts will receive temporary mitigation measures.

The state would have to enter the much more dire Tier 3 shortage for municipal and industry use to be impacted at all, an unlikely scenario for many years to come. Many communities have put together alternate portfolios of water that include sources other than the Colorado River. Additionally, Arizona has banked about 13-million-acre feet of water, enough for the urban Sun Corridor to survive exclusively on this source for 10 years.

“One of the key takeaways is that this is not going to impact your ability to turn on the water in the morning. You’re going to be able to take a shower and get a glass of water,” according to Gray.

“As we’ve grown the Sun Corridor, we’ve transitioned…” Gammage said. “We’ve had to start thinking differently and more strategically about where the water for municipal growth comes from.”

Arizona cannot rely solely on groundwater due to the limitations put in place by the 1980 Groundwater Management Act. This act in place put a cap-and-trade system so that groundwater supplies would not be exhausted.

“This is a big turning point for Arizona,” Ward agreed. “The Director of Water Resources recently announced that the days of utilizing native groundwater to grow development are over. It’s done. What that means is that we’ve got to find ways to live within the constraints. We have room to do that… As long as we grow smart, we can continue to grow economically and grow our communities.”

The bottom line is that Arizona’s municipal water supply is secure for the next several decades thanks to smart decisions made by business and governmental leaders in the past. Work is already underway to augment supplies further into the future. Arizona remains a safe place to invest provided that we all do our part to reasonably conserve water and participate in stakeholder processes to plan for a hotter and more arid climate.