Agriculture to Urban bill focused on increasing Arizona’s housing supply

The Arizona Legislature passed a bipartisan bill Monday, June 30, 2025, intended to increase the state’s housing supply while conserving water.

The bill is known as “ag-to-urban.” It allows developers to buy water rights from farmers who give up their agricultural land for homes in metro Phoenix and Pinal County. The homes would use only a percentage of the water the farms had used.

The bill was prompted by a moratorium Governor Katie Hobbs set on new housing construction in Phoenix suburbs due to low groundwater levels. This legislation would give developers a new pathway to build homes in those restricted areas.

Sarah Porter, Director at Kyl Center for Water Policy, joined “Arizona Horizon” to tell us more.

“The new law allows for the conversion of the grandfathered agricultural rights to pump ground water into a smaller right to pump ground water for new development or for a different use. Think for urban development or for municipal use for existing users,” Porter said.

Porter also noted that this will also benefit existing water providers along with new developers.

“The law is really designed to provide one pathway for a water supply for a new development. But it’s not exclusive to growth. Existing water providers could also take advantage of the law and acquire these water rights, use them as part of their water supply rights portfolio,” Porter said.