Arizona: Hobbs Administration Issues Cease & Desist to Prevent Illegal Development in Rio Verde Foothills Lacking Assured Water Supply

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PHOENIX ~ In a recent development, the Arizona Department of Real Estate (ADRE) has taken action against a real estate developer for illegal subdividing, also known as "wildcat development," in the Rio Verde Foothills area east of Scottsdale. This move comes after Governor Katie Hobbs directed the ADRE to crack down on such activities that exploit loopholes in consumer protection laws.

The ADRE issued a Cease & Desist Order against the developer group and recorded it with the Maricopa County Recorder's office. According to the Order, the developer failed to obtain a subdivision public report, which is required by law and includes obtaining a certificate of assured water supply from the Arizona Department of Water Resources or a written commitment from a designated water provider.

Governor Hobbs expressed her satisfaction with this swift action taken by the ADRE, stating that it is necessary to prevent developers from evading consumer protection and water security laws. She also highlighted the need for legislative action to address these loopholes and protect everyday Arizonans from being exploited for profit.

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This investigation and enforcement action by Governor Hobbs' administration is part of her commitment to safeguarding water supplies for all Arizonans. She has made it a priority to prevent developments that bypass real estate and water laws, putting citizens at risk. By recording the Cease & Desist Order, ADRE will ensure that no homes are sold until a reliable 100-year water supply has been identified and proven as part of the project's public report.

The Attorney General's Office collaborated with ADRE on this investigation and enforcement action, demonstrating coordination within the Executive Branch to protect consumers in Arizona. Attorney General Kris Mayes emphasized their commitment to holding accountable those who violate state laws and put citizens at risk, especially in areas like Rio Verde Foothills where water is limited.

Commissioner Susan Nicolson of ADRE stated that their role is to protect property owners and the public in real estate transactions. She stressed the importance of educating developers and ensuring that all legal requirements, including water availability, are disclosed to potential buyers. Failure to do so puts buyers at an unacceptable risk.

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In 2023, Governor Hobbs signed Senate Bill 1432 after working across party lines to secure a water solution for the Rio Verde Foothills area. This came after she vetoed a partisan bill that was deemed unworkable. She also tasked her Water Policy Council with finding solutions to the issue of wildcat development, resulting in a set of consensus recommendations. However, these recommendations were not implemented by the legislature, leaving citizens in Rio Verde Foothills and other areas vulnerable to exploitation through loopholes in development and water laws.

For more information on the Governor's Water Policy Council Recommendations, please visit their website.

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