Buckeye City Council approved a $635,765.65 purchase of 2,017.51 acre-feet of groundwater extinguishment credits on October 20, adding a regulatory water-supply asset that the city says can support its long-term assured-water-supply planning.
The credits would be purchased from Circle G Pegasus LLC for $315 per acre-foot, plus a $250 Arizona Department of Water Resources conveyance fee. The council acted on the agreement as part of its consent agenda, and the city’s official legal-action report marks the item approved.
The approval is an important step, but the transfer is not final. The purchase agreement and staff report make the deal conditional on ADWR accepting the conveyance and allowing the underlying certificate to be split. If the agency rejects the transfer or invalidates the credits, Buckeye would have no payment obligation or would be entitled to a refund.
What Buckeye is buying
Extinguishment credits are accounting assets used in Arizona’s assured-water-supply program. They are created when a holder permanently gives up certain groundwater rights. According to ADWR’s program overview, credits may be pledged to an assured-water-supply certificate or to a water provider’s designation to help satisfy state rules within an Active Management Area.
They are not a physical shipment of water, a new well or a reservoir purchase. The 2,017.51 acre-feet would equal roughly 657 million gallons as a volume comparison, but the transaction concerns regulatory credits tied to an extinguished groundwater right.
The Buckeye agreement identifies the credits as coming from Extinguishment Certificate No. 58-111119.0041. ADWR approved those credits in 2007, and the agreement says they may be used within the Phoenix Active Management Area.
City staff said the credits can support Buckeye’s Designation of Assured Water Supply and are exempt from replenishment requirements. A designation allows developments served by the city to rely on the city’s water-service commitment rather than obtaining a separate assured-water-supply determination for each subdivision. The staff report does not tie this purchase to a particular development.
Payment depends on state acceptance
The agreement set an October 23 deadline for city approval and appropriation, which the council met. It directs the seller to file the transfer with ADWR and requires Buckeye to pay within four business days after the seller provides notice, no later than October 30.
Buckeye cannot use, pledge or transfer the credits until it has paid and ADWR has accepted the final conveyance. The seller also warrants that the credits are unpledged and transferable, subject to the state agency’s review.
The purchase was budgeted in fiscal 2027, according to the staff report. Council approval does not allocate the credits to a project, authorize construction or establish that a specific development has secured water service.
The next verifiable milestone is ADWR’s acceptance and recording of the transfer, followed by the city’s payment. West Valley Post will track that status and any later pledge of the credits in the Buckeye Development Tracker.
Featured image: AI-generated editorial illustration by West Valley Post. It does not depict a specific Buckeye water facility, groundwater right, storage site or the credits in this transaction.
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