Carbone Blasts Hobbs Housing Moratorium Over Taxpayer Risk

PHOENIX — Arizona House Majority Leader Michael Carbone (R-26) is emerging as one of the loudest legislative critics of Gov. Katie Hobbs’ housing moratorium, arguing the administration’s water policy has unlawfully restricted growth, worsened affordability, and exposed taxpayers to potentially massive financial claims.

The controversy centers on the Arizona Department of Water Resources’ handling of certificates of assured water supply in the Phoenix Active Management Area. Under Arizona law, new subdivisions must demonstrate a 100-year water supply before moving forward. But under Hobbs, ADWR adopted broader groundwater standards that effectively halted certain new developments in parts of Maricopa County by requiring compliance with wider regional groundwater conditions.

A Maricopa County Superior Court judge recently ruled that ADWR exceeded its authority and failed to follow required rulemaking procedures when imposing those standards. The ruling blocked the department from relying on the disputed rules, dealing a major setback to one of the Hobbs administration’s most consequential growth-control policies.

Carbone has framed the issue not only as a legal defeat for Hobbs but as a direct threat to working families. He has argued that water, land-use, and housing policies are inseparable — and that restricting development on more affordable land inevitably pushes home prices higher across the Valley.

“Water policy is land use policy, and land use policy is housing policy,” Carbone said in previous criticism of the administration’s approach. He argues that Hobbs’ policy did not merely address groundwater concerns; it effectively dictated where Arizonans could live and where builders could provide new housing.

The financial stakes are also rising. Developers connected to the Tartesso project in Buckeye have filed a claim seeking more than $320 million under Proposition 207, Arizona’s Private Property Rights Protection Act. They argue the state’s actions damaged their property rights and reduced the value of land that had been positioned for future development.

If similar claims follow, critics warn the state’s exposure could climb far higher, potentially leaving taxpayers responsible for the cost of a policy the court has already found was improperly imposed.

The Hobbs administration has defended tougher groundwater oversight as necessary for long-term sustainability in one of the nation’s fastest-growing regions. But Carbone and other Republicans say the governor pursued that goal through executive overreach rather than lawful rulemaking or legislative negotiation.

For Carbone, the case has become a broader warning about the consequences of using agency power to impose sweeping policy changes. What began as a groundwater dispute is now a fight over housing affordability, property rights, and whether Arizona taxpayers will be forced to pay for a moratorium lawmakers say should never have been imposed.