AZ Rev Stat § 45-108.02 (2021)
2021 Arizona Revised Statutes|Title 45 - Waters|§ 45-108.02 - Exemption from adequate water supply requirements for city, town or county based on substantial capital investment; application; criteria; expiration

45-108.02.  Exemption from adequate water supply requirements for city,  town or county based on substantial capital investment;  application;  criteria;  expiration A. If the director determines pursuant to section 45-108 that an adequate water supply does not exist for a proposed subdivision and the proposed subdivision is located in a city,  town or county that requires a determination of adequate water supply by the director as a condition of approval of the plat pursuant to section 9-463.01,  subsection J or O or section 11-823,  subsection A,  the subdivider may apply to the director for an exemption from the water adequacy requirement pursuant to this section on a form prescribed by the director within one year after the requirement first becomes effective. The director shall grant the exemption if the subdivider demonstrates to the satisfaction of the director that all of the following apply: 1. The subdivider has made substantial capital investment toward the construction of the proposed subdivision before the date the water adequacy requirement first became effective. For the purposes of this paragraph,  substantial capital investment may include construction costs,  site preparation costs,  construction of off-site improvements and conversion or remodeling costs for existing structures,  as well as planning and design costs associated with those items,  but does not include the original cost of acquiring the property. 2. The subdivider was not aware of the proposed water adequacy requirement at the time the investment was made. 3. The proposed subdivision complied in all other respects with existing state laws as of the date the water adequacy requirement became effective. B. If the director grants an exemption pursuant to subsection A of this section: 1. The exemption expires five years after the date the exemption is granted,  unless before that date at least one parcel in the subdivision is sold to a bona fide purchaser or the director extends the exemption pursuant to paragraph 2 of this subsection. 2. The director may extend the period of the exemption for no more than two successive five-year periods if the subdivider applies for an extension before the exemption expires and demonstrates to the satisfaction of the director that the subdivider has made material progress in developing the subdivision,  but that sales of parcels in the subdivision have been delayed for reasons outside the control of the subdivider. C. If an exemption granted under this section expires,  any public report issued for the subdivision by the state real estate commissioner pursuant to section 32-2183 expires and the subdivider shall not sell any lots in the subdivision unless both of the following apply: 1. The subdivider files with the state real estate commissioner a new notice of intention to subdivide lands pursuant to section 32-2181 and complies with section 32-2181,  subsection F. 2. The state real estate commissioner issues a new public report for the subdivision pursuant to section 32-2183. D. Section 45-114,  subsections A and B govern administrative proceedings,  rehearing or review and judicial review of final decisions of the director under this section.