AZ SB1606

Prohibits municipalities and counties from approving building permits for detached residential dwelling units in residential lease communities within active management areas unless the applicant obtains a certificate of assured water supply from the Department of Water Resources or a written commitment of water service from a designated city, town, or private water company.

Requires applicants to pay all applicable activation fees under section 48-3772 and replenishment reserve fees under section 48-3774.01, with proof of payment attached to the building permit application.

Exempts existing residential lease communities and planned communities that applied for or received zoning entitlements on or before September 30, 2024 from these new requirements.

Defines "residential lease community" as six or more detached residential dwelling units intended to be offered for lease under a common promotional plan, excluding agricultural worker housing on agricultural property.

Establishes annual membership dues for dwellings within residential lease communities and modifies fee payment schedules to allow full payment at time of enrollment for residential lease communities.