AZ HB2338

Establishes regional water augmentation authorities in Arizona as political subdivisions that can be formed by two or more entities (including cities, counties, tribes, and private entities) with at least one public agency member to develop water supply projects and acquire water rights.

Grants authorities broad powers to acquire, sell, and lease water; construct and operate water projects; issue revenue bonds; charge fees; and exercise eminent domain for pipelines and infrastructure, subject to restrictions on condemning water, water rights, wells, or existing water systems.

Amends the water supply development revolving trust fund (renamed the "water supply development revolving trust fund") to allow regional water augmentation authorities to receive financial assistance for water supply development projects, with loan terms up to 50 years.

Requires authorities receiving trust fund assistance to comply with adequate water supply requirements for subdivided land outside active management areas and prohibits provision of water to such subdivisions without director approval.

Appropriates $30 million from the general fund in fiscal year 2013-2014 to the water supply development revolving trust fund and makes the appropriation exempt from lapsing provisions.