According to a recent letter from the Goldwater Institute, Governor Katie Hobbs’ administration has imposed a regime of regulation that has ground the development of new home construction in the fast-growing areas of Maricopa County to a halt. Now, the organization is challenging the validity of the newly established rules.
A press release this week from Goldwater stated that the action conducted by the Arizona Department of Water Resources (ADWR), which lacks the approval of the Arizona legislature or a formal regulatory approval process, is “driving up housing costs for all Arizonans and threatens to stifle economic growth in our state.”
Goldwater went on to characterize the ADWR’s move as “one of the most significant bureaucratic overreaches in Arizona’s history.” In its letter to the agency, it urged leaders to reverse course.
Bureaucrats under AZ @GovernorHobbs have enacted a rule stopping new home construction in Maricopa County’s fastest-growing, affordable areas.
Jon Riches, Goldwater’s Vice President for Litigation, explained in his letter:
“ADWR has imposed two AMA-Wide rules that have prevented HBACA (Home Builders Association of Central Arizona) members from obtaining Certificates of Assured Water Supply. The first of these invalid rules provides that, if groundwater modeling predicts that a well may not be able to fully satisfy projected demand in any location within the Phoenix AMA Model domain within the next 100 years, then there is no groundwater available throughout the entire model domain (‘AMAWide Unmet Demand Rule’). The second invalid rule provides that if modeling predicts that depth-to-water will exceed 1,000 feet in any location within the Phoenix AMA in the next 100 years, then there is no physical availability of water anywhere within the Phoenix AMA model domain (‘AMA-Wide Depth-to-Water Rule’).”
Goldwater noted that the AMA-Wide Unmet Demand Rule doesn’t exist under Arizona law and was not adopted through the legal rulemaking process. It argued that under previous rulings in Arizona courts, the policies are “rules” and are legally subject to Administrative Procedure Act’s (“APA”) rulemaking process. Specifically, it cites “an agency policy as a rule subject to the Administrative Procedures Act’s rulemaking process as one that ‘is generally applicable, and … implements, interprets or prescribes law or policy, or describes the procedure or practice requirements of an agency.’”
Furthermore, the rule was reportedly created under what Goldwater refers to as a “flawed concept,” the eponymous “unmet demand,” which establishes that if a groundwater shortage is projected by models at any location within a given management area, then zero groundwater across that area will be considered available for any use.
“The model further compounds this issue by arbitrarily placing wells throughout the management area that do not move over the course of 100 years, far in excess of the life expectancy of most wells,” Goldwater writes.
”If water in a hypothetical well is projected to dip below a certain depth in the East Valley, the agency declares a water shortage for developments in entirely unrelated areas like the West Valley.”
In the release, the Goldwater Institute expressed concern that the Hobbs administration took this action unilaterally, effectively defying both the legislative and judicial branches of the Arizona government in what amounts to a massive overreach of her executive authority.
Arizona home prices continue to be a major issue for people in the closing weeks of the 2024 General Election.
Last week, the Common Sense Institute Arizona unveiled its report for “Arizona Housing Affordability” for quarter 3 of 2024, sharing a “comprehensive analysis that details current challenges in Arizona’s housing market, including the ongoing housing shortage, escalating costs, and affordability issues that persist across the state.”
The report highlights that the state “is currently experiencing a housing shortfall of 65,721 units,” that “the average home price is nearly 23% higher than it would have been if prices had maintained the pre-pandemic trend,” and that “the number of building permits issued in Arizona has continued to drop, affecting the state’s ability to meet housing demand.”
“The high costs of housing in Arizona are creating significant barriers to homeownership, especially for lower-income families and first-time buyers,” said Zachary Milne, Senior Economist and Research Analyst. “While minor improvements in mortgage rates have provided some relief, the state’s overall housing deficit continues to widen, reflecting the need for housing policies that boost supply and affordability.”
CSI found that “it would take at least ten years for Arizona to resolve this [housing] deficit, that “it would still take 41 months for housing prices to fall back in line with the 2012-2019 trend if prices continued to decline at this pace [of July and August], that “new homebuyers today face nearly $500 more in monthly mortgage costs,” and that “it would take Maricopa County over 85 years to close their housing deficit.”
In a comment to AZ Free News about the report, Arizona Senate President Warren Petersen said, “It’s truly unfortunate the Governor vetoed the bipartisan Arizona Starter Homes Act and halted new home construction in two of the most booming areas in the Valley. Her actions have negatively impacted Arizona’s housing supply by contributing to the shortage, and as a result, hardworking Arizonans are having a difficult time achieving their American dream of homeownership because of skyrocketing prices. Republicans will continue to put bills on her desk to help alleviate the supply shortage next session, and we hope she will do the right thing by signing them.”
Recent polls have indicated that the issue of housing affordability is a top-three concern for many voters around the country, including in Arizona, affecting the upcoming election in November.
Daniel Stefanski is a reporter for AZ Free News. You can send him news tips using this link.
Two Arizona Republican bills to tackle the state’s deepening housing crisis were recently signed into law.
Last week, Governor Katie Hobbs signed HB 2720 and HB 2721. HB 2720 “establishes requirements relating to accessory dwelling units” – according to the overview from the Arizona House of Representatives. HB 2721 “adopts requirements for middle housing development” – also according to the overview from the state House.
In a statement that followed the governor’s signature of his bills, State Representative Michael Carbone, a Republican, wrote, “It’s the goal of Republicans in the Legislature to make life more affordable for everyday Arizonans by addressing the urgent need for more diverse housing options. I’m pleased to have the Governor sign my two bills into law, which will help mitigate the effects of rising housing costs and ensure that our teachers, nurses, firefighters, police officers, and families can live in the communities they serve and love.”
Carbone added, “Importantly, the legislation reinforces a homeowner’s right to use their property as they see fit which, for some, may include adding accommodations for multigenerational housing or to generate additional income. The enactment of this legislation is a significant step toward solving the state’s housing crisis, and I am proud of the bipartisan effort that made it possible.”
Hobbs also released a statement to mark her signature on these two proposals, saying, “I’m glad the legislature heard my calls to come to the table to pass common sense, bipartisan legislation that will expand housing options and help mitigate the effects of rising costs to make life more affordable for everyday Arizonans. And today, I’m proud to sign bills into law that will expand access to ADUs and missing middle housing.”
The governor continued, “I was born and raised in an Arizona where a middle-class family could buy their own home. In the past year alone we have made dramatic strides towards making that the reality again for the next generation. …Moving forward, I hope we can work together to address short term rentals that displace long-term community residents, and crack down on speculation by out-of-state real estate investors that drives up the cost of housing for Arizonans.”
Both bills will go into effect 90 days after the conclusion of the 2024 Arizona Legislative Session.
Daniel Stefanski is a reporter for AZ Free News. You can send him news tips using this link.
A freshman Arizona Republican Representative scored a victory in his efforts to uphold the interests of hard-working taxpayers.
Last week, Representative Matt Gress issued a press release, announcing that “the Arizona Department of Housing won’t be enforcing a controversial – and very likely illegal – provision in its contract with the City of Scottsdale.”
✅FOR IMMEDIATE RELEASE✅ State Representative @MatthewGress Announces Victory in Ongoing Fight Against Scottsdale’s Taxpayer-Funded Homeless Hotel Plan
“This is a victory for the safety and well-being of Scottsdale’s residents, many who staunchly oppose their tax dollars being… pic.twitter.com/Hn37QdHJ7h
Gress’s release explained that the “contract provision would have authorized the City to use the state funds to house homeless people from ‘the zone’ in downtown Phoenix and foreign nationals who otherwise would have been expelled under Title 42 in a hotel close to Pima and Indian Bend Roads.” The release added that “the City was previously awarded a $940,000 grant from the Department of Housing to carry out the terms of the contract,” and that “the Department has now admitted to Representative Gress that, despite the terms of the Contract, it does not intend to enforce the ‘Zone’ or the ‘Title 42’ provisions of its Contract with the City.”
In a statement accompanying his release, Gress said, “This is a victory for the safety and well-being of Scottsdale’s residents, many who staunchly oppose their tax dollars being spent to house homeless from other cities and foreign nationals who should have been deported under Title 42. I maintain serious concerns regarding the city’s intentions to utilize area hotels for this purpose and intend to pursue this matter further. Soon I will announce details of a public subcommittee hearing where I plan to delve more deeply into the problematic approach of converting hotels to housing for homeless.”
This is an important step in the right direction. We need real treatment options for unhoused individuals, not temporary shelters converted from hotel rooms.
I’ll be exploring this topic in an upcoming subcommittee hearing.
On August 3, Representative Gress transmitted a letter to Arizona Department of Housing Director Joan Serviss, expressing his concerns about “significant and unsettled questions (regarding) the validity and enforceability of the Contract” between the City of Scottsdale and the Department. Gress asserted that “nothing in state law or S.B. 1720 (what the Department derived its authority to execute the Contract under), however, authorizes the Department or the City to use state monies to provide housing for foreign nationals who entered the country after Title 42 was lifted in early May.”
The Representative warned that “if the Department enforces this unlawful provision, or if the City attempts to require the hotel to house individuals from the Zone or aliens who have been released under the federal government’s unconstitutional parole program, the City and the Department will be vulnerable to a lawsuit by a taxpayer to recover the illegal payment of public monies.”
Director Serviss responded to Gress on August 18, informing the legislator that “while we stand by the validity of the Contract, we have confirmed with the City that the shelter beds and services provided pursuant to the Contract have not and will not serve those individuals impacted by the Zone and Title 42.”
The issue of temporarily housing foreign nationals in cities around Arizona is not new to the state. In 2021, former Republican Attorney General Mark Brnovich sent a letter to the Secretary of the U.S. Department of Homeland Security and the Acting Director of the U.S. Immigrations and Customs Enforcement, “expressing grave concerns that an ICE contractor has apparently subcontracted with the current owners of a hotel…in Scottsdale to operate a 1,200-person ICE detention facility.” Brnovich noted his disappointment with the federal government over its neglect to confer with his office before executing this contract, highlighting the “important public safety issues involved in locating any detention center in a community setting.”
Daniel Stefanski is a reporter for AZ Free News. You can send him news tips using this link.
The city of Phoenix will vote on whether to ban income discrimination for housing during the next upcoming council meeting. The ban would likely have the most significant impact for the homeless and low-income who receive housing vouchers.
According to the proposed ordinance, those who discriminate based on a homebuyer or renter’s source of income would face civil penalties of up to $2,500, as well as daily penalties of up to $2,500.
In a letter to City Manager Jeff Barton, several members of the council claimed that income discrimination violated a civil right to fair housing. Federal law only prohibits discrimination based on race, color, national origin, religion, sex, gender identity, sexual orientation, familial status, and disability.
“Too often, the practice of considering a source of income is used to discriminate against renters who use housing vouchers, Social Security disability, foster family credits, or benefits from the Department of Veterans Affairs,” stated the letter.
Councilmembers Laura Pastor, Betty Guadardo, and Carlos Garcia signed off on the letter, disclosing that Mayor Kate Gallego and four other members of the council support this proposed ordinance.
19 states and Washington, D.C. have banned income discrimination for housing.
The vote will come about a week after the House passed a bill banning local governments from requiring hotels and motels to accept housing vouchers from the homeless passed the House.
HB2379 by State Rep. Matt Gress (R-LD04) specifically prevents cities, towns, and counties from requiring hotels and motels to participate in housing programs for the homeless, thereby allowing them to refuse housing voucher payments for an unoccupied guest room. Voucher funds come from the Department of Housing and Urban Development (HUD). The House passed Gress’ bill along party lines, with all Republicans voting for it and all Democrats against it.
House Minority Leader Andrés Cano (D-LD20) claimed that the bill wasn’t compassionate. He alluded that a housing-first approach was the right solution for the homeless.
“What message is the state of Arizona sending if we have vacant hotel rooms and people living on the street?” said Cano. “It is the message that we can’t have people in our state housed. I’m worried that’s what this bill does. Democrats stand ready, we are absolutely ready, to address their long-term needs.”
Gress rebutted that his bill was common sense. He cited the Arizona Lodging & Tourism Association recommendation against requiring hotels and motels to accept housing vouchers, due to the fact that staff weren’t equipped to handle the needs of the homeless.
“This legislation is trying to prevent what would amount to a takings of private property, to force unequipped and untrained hotel workers to help address the situation with homelessness. Many of these individuals struggle with mental health and addiction issues,” said Gress. “We’ve seen too many bad ideas being exported from California, and this is another one we’re trying to prevent.”
Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to corinne@azfreenews.com.
