Historical Economic & Fiscal Impacts of Development Facilitated by the Central Arizona Groundwater Replenishment District on the State of Arizona
About the Study
The Central Arizona Groundwater Replenishment (CAGRD) was established in 1995, covering Maricopa, Pima and Pinal Counties.
Since 1995, new residents of the CAGRD regions have spent over $180 billion on goods and services in the local economy, supporting thousands of jobs each year.
Residential construction on CAGRD member lands has provided around $7.8 billion in revenue for the State of Arizona and local governments.
Over 460,000 homes have been built, growing the population to over 1.2 million residents and creating a demand for goods and services to sustain the economic growth in the state.
Executive Summary
The following report estimates economic and fiscal impacts of the development activity that has been facilitated by the Central Arizona Groundwater Replenishment District (“CAGRD”) in many regions throughout Maricopa County, Pima County, and Pinal County.
In 1993, the Arizona Legislature provided the Central Arizona Water Conservation District (“CAWCD”) with replenishment authorities within its three‐county service area (Maricopa, Pinal and Pima counties). CAWCD’s replenishment authorities are known collectively as the CAGRD. Subsequently, in 1995, the Arizona Department of Water Resources adopted new Assured Water Supply Rules that allowed enrollment in CAGRD to serve as partial demonstration of a 100‐year assured water supply.
Since 1995, a significant number of areas have enrolled in CAGRD in order to be able to facilitate growth. The following map illustrates the wide encompassing areas that have benefitted from CAGRD membership, many in high growth areas of the State. It is estimated that over 460,000 homes have been built in these regions, equating to a population of over 1.2 million residents.
Without the creation of CAGRD, a significant percentage of the land within the regions that were not developed by 1995 (when the new Assured Water Supply Rules became effective) could never be developed because water providers or landowners would have to buy and store a 100‐year renewable water supply up front at prohibitive expense.
The development within CAGRD member lands and member service areas has generated enormous benefits in terms of job creation and additional tax revenues to the State of Arizona, its counties and municipalities from construction and the spending of new residents which has supported local industry. The following are key findings resulting from the analysis.
- Construction activity has generated over 1.1 million person years of employment, nearly $50.4 billion in wages, and over $135.7 billion in economic impact throughout the State of Arizona. This equates to an annual average of 40,245 jobs each year over the last twenty-eight years with annual wages of $1.8 billion and over $4.8 billion in annual economic output.
- New residents within CAGRD regions have spent over $180 billion on goods and services in the local economy since 1995. Their spending supported hundreds of thousands of jobs each year, generated nearly $95.6 billion in wages, and created $253.6 billion in economic output. As of 2022, resident spending supports nearly 178,600 jobs, over $9.2 billion in wages, and $24.9 billion in annual economic activity. These figures are expected to continue to grow each year as new development occurs.
- Residential construction that has occurred on CAGRD member lands and within member service areas produced an estimated $7.8 billion in revenues for the State of Arizona and its local governments. Nearly $3.9 billion was generated through construction sales taxes. Employee generated taxes by construction workers and state shared revenues totaled an estimated $3.9 billion. These estimates do not include impact or permit fees, which would be substantial.
- The State and local governments have collected OVER $27 billion from tax revenues generated by residents of CAGRD regions. Significant sources of revenue include sales tax ($8.7 billion), income tax ($6.7 billion), and property tax ($5.1 billion). Residents have also contributed through vehicle license taxes, utility taxes, the highway user revenue fund, and unemployment insurance taxes.
- All totaled, the impacts attributable to CAGRD membership have reached over $35.1 billion in collected tax revenue.
- In just the last year alone, the development that occurred provided nearly $493.8 million to state and local governments while existing residents generated over $2.6 billion in tax revenue for the State of Arizona and various government jurisdictions.
Protecting Arizona’s Groundwater for Future Generations
