Scottsdale City Council approve agreement to provide water for the Rio Verde Foothills Standpipe District

As part of its continuing leadership role in addressing the lack of a sustainable water supply for Maricopa County residents in the Rio Verde Foothills area, the Scottsdale City Council approved an intergovernmental agreement at its Sept. 5 meeting.

The intergovernmental agreement is with the Rio Verde Foothills Standpipe District, an entity created by Arizona Senate Bill 1432, which became law in June. Scottsdale's own water resources will not be used, and the rate charged to the standpipe district is set so that costs are fully recovered on behalf of the Scottsdale residents who pay for the infrastructure and operation of the city's water system.

Under the agreement: 

• The Rio Verde Foothills Standpipe District will acquire a water supply that can be provided to Scottsdale at one of the city's surface water treatment facilities - Scottsdale's own water resources will not be used.
• The city will treat the water and make it available at the Pima Road Fill Station, from which haulers contracted by the district could provide water for up to 750 customers in Rio Verde Foothills (the limit stipulated by A.R.S. 9-500.40).
• The city's agreement is with the district only, which may then contract with other parties as needed to supply water to Rio Verde Foothills customers; the agreement will terminate Dec. 31, 2025.

Scottsdale Water, the city’s municipal water utility, operates as an enterprise fund - meaning all infrastructure and operating costs involved with obtaining, treating, testing and delivering water are borne by rate payers of the system, currently about 94,000 residential and business customers. 

Rates charged to the Rio Verde Foothills Standpipe District are set to repay the city's costs, account for system losses and water that will not be recovered in the city's wastewater system (Scottsdale treats its wastewater and uses it for various non-potable purposes). Rates to the standpipe district will increase annually as Scottsdale Water rates increase.  

More than half of the proposed RVFSD rate is a capital recovery fee from which the city will pay to upgrade its Pima Road fill station so that the station can operate reliably and safely at the higher capacity required to serve the additional water haulers the district may contract with. The city estimates that 85% of the capacity of that station will be used by the district, so 85% of the estimated $1.2 million cost for improvements will be charged to the district via the capital recovery fee that is included in the rate.

While improvements are needed at the fill station, they will not delay the availability of water to the Rio Verde Foothills Standpipe District. Once the requirements of the agreement are met, Scottsdale will be ready provide water within seven days.