Water Constraints and Rapid Growth Reshape Arizona’s Pinal County

Written by:

Steve Marcinuk

Date:

24 Feb 2026

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Pinal County, located between Phoenix and Tucson, has become one of Arizona’s fastest-growing regions, issuing more than 3,000 single-family permits in 2024 alone. This surge in development underscores the county’s appeal for homebuilders and new residents. Still, it also exposes deep challenges in water policy that now dictate where and how new housing can be built.

Stephen Miller, District 3 Supervisor and former chairman of the Pinal County Board of Supervisors, has observed these trends from multiple vantage points. Before entering public service in 2014, Miller spent decades as a contractor building residential and commercial projects in the county. His experience provides a clear view of how regulatory hurdles have compelled both local officials and developers to adapt in real time.

A Halt in Water Certificates Redefines Growth

The most significant factor currently shaping development in Pinal County is the near-total freeze on the issuance of new certificates of assured water supply. Arizona requires these certificates for most new subdivisions to ensure that long-term water resources exist before homes are built. But in 2013, the Arizona Department of Water Resources stopped issuing these approvals for much of the county, creating a bottleneck that has stalled traditional subdivision development.

Instead of denying applications outright, the department labeled them “incomplete,” leaving developers unable to proceed and unsure how to resolve the issue. “All the applications that had been submitted to the Department of Water Resources were deemed incomplete,” Miller says. “But trying to understand what was not complete about my application was a difficult challenge.”

This regulatory impasse has divided the county along geographic lines. In the north, areas such as San Tan Valley continued to grow, drawing on existing banked permits and operating under different water-management rules. In contrast, southern regions—including Casa Grande, Coolidge, and Eloy, which Miller represents—have been largely unable to approve new subdivisions without preexisting water certificates.

“We had a lot of inventory to work with in the city [of Casa Grande], but outside the city, you couldn’t get those certificates if you didn’t already have them,” Miller explains. The effect is clear: “There will be a point when, if we cannot get our water resolved, we will kind of stall.”

Developers Pivot to Build-to-Rent and Multifamily

With the traditional subdivision path blocked, developers have sought out housing models that bypass the certificate requirement. The most prominent shift has been toward apartments and build-to-rent communities, which are not subject to the same water assurance rules.

“There are a lot of people with large tracts of land that did not have their certificates of assured water, so they chose to develop apartments and build-to-rent,” Miller notes. This workaround has enabled construction to continue and helped the county accommodate new residents, but it alters the fabric of local communities.

Rental housing, Miller points out, often attracts a more transient population than owner-occupied single-family homes. “The idea that you have a single-family home, that resident usually is more grounded—the little league coach, helping out at the school. It’s not as transient.” While rental inventory meets immediate housing needs, it can affect long-term community stability and involvement.

San Tan Valley: A Case Study in Rapid Urbanization

The growth challenges and adaptations in Pinal County are especially evident in San Tan Valley. In 2024, San Tan Valley became the largest city in the U.S. to incorporate in a single action, with about 100,000 residents transitioning from county jurisdiction to city status overnight. This dramatic change followed three separate incorporation votes over 15 years, reflecting the complexity of managing suburban expansion at the county level.

“You had 100,000 people living in north Pinal County that had the look of a city, but only had the amenities of a county,” Miller says. Counties in Arizona are not equipped to provide comprehensive urban services. “Counties were never designed to be urban providers. They’ve always been extensions of the state. We have the health department, the recorder, and the assessor. Cities have trash pickup, parks, and recreation.”

San Tan Valley’s incorporation underscores a broader trend: as suburban populations swell, local governance structures must evolve to meet the demand for city-level services and infrastructure.

A Developer’s Mindset in Public Service

Despite the regulatory hurdles, Miller maintains a development-friendly stance rooted in his background as a builder. “I’m a very property rights kind of guy,” he says. “I really think that people should be able to develop property for the benefit of themselves and possibly other people.”

His approach to land use is straightforward: “There’s really only one question you have to answer: is this an appropriate use in this place? We’re not trying to put a glue factory in a subdivision.” This philosophy aims to balance individual property rights with the public interest.

The process for securing development approvals, however, remains lengthy and complex. Major projects typically require two years from initial concept to final approval, encompassing transportation studies, flood-mitigation analyses, and utility planning. “There’s a lot of expense put into these things,” Miller says, highlighting the financial and logistical burdens developers face.

Industrial Expansion and Water Resource Competition

Pinal County’s appeal now extends beyond housing. The region has attracted significant investment from manufacturing firms and data centers, raising questions about competition for limited water resources between industrial and residential users.

Miller does not see direct competition between these sectors. “Everybody’s scenario is slightly different. Everybody will have to establish their own source of water,” he explains. Each industrial or residential project must navigate its own challenges, often at high cost. “Every location will have its own challenges. It will not be easy. It’s going to cost more.”

Recent projects show this complexity. New factories and data centers often rely on a mix of groundwater, reclaimed water, or negotiated supply agreements with local utilities. These arrangements add to project timelines and can influence where companies choose to locate.

Legislative Changes and Future Prospects

Recent state legislation offers some potential relief. Miller points to new “ag-to-urban” laws that permit the conversion of agricultural water rights to municipal uses, thereby creating pathways for future development. “Arizona Water has achieved that status now, so there’ll be some water activity of some type,” he notes.

These legal changes may help unlock stalled projects, but the process remains slow and uncertain. Developers and local officials must coordinate closely with state agencies and water providers to secure approvals, adding layers of negotiation to every new development.

Despite these challenges, Miller remains optimistic about Pinal County’s future. The county has already undergone a major economic transition, moving from an agricultural base to becoming a hub for manufacturing and logistics. “Pinal County, although we have challenges, we’ve always met those challenges head-on. We’ve transitioned from a real agricultural county to now a manufacturing hub,” Miller says.

His philosophy for county government is clear: “My slogan when I ran for office years ago was ‘we’re here to facilitate, not regulate.’ I want my staff to find solutions that help these people fulfill their dreams.”

What Pinal County’s Experience Means for Arizona

As Arizona’s population and economic base continue to grow, Pinal County’s experience offers a preview of how other fast-growing regions may need to adapt. The county’s recent history indicates that regulatory constraints—especially regarding water—can drive fundamental changes in how and where housing is built. Developers who once relied on large-scale subdivisions now turn to rental models or pursue projects only where existing water rights allow.

For real estate professionals, builders, and local governments, the lesson is clear: success in water-constrained markets requires not only understanding demand but also mastering the regulatory environment that shapes development. Creative responses, from build-to-rent housing to new forms of municipal governance, have become essential strategies as traditional models confront resource limits.

Looking ahead, Pinal County’s mix of opportunity and complexity will likely persist. The region’s ability to attract new residents and businesses now depends as much on navigating water policy as on market fundamentals. Those who can align growth plans with evolving regulations—and who are willing to invest in long-term solutions—will be best positioned to thrive in Arizona’s changing landscape.