Phoenix's plan to keep the water flowing

In Arizona's perpetual quest to alleviate its water shortage, the Water Infrastructure Finance Authority (WIFA) is expected to start considering innovative proposals next year to keep the desert state hydrated.

Catch up quick: Lawmakers and former Arizona Gov. Doug Ducey last year established a plan to provide WIFA with $1 billion over three years for a long-term water augmentation fund that  would finance a desalination plant or other major project.

• The budget that Gov. Katie Hobbs signed in May cut about $143 million from next fiscal year's allocation, which should leave the fund with around $850 million total.

Why it matters: The Colorado River basin, which includes Arizona, is in the midst of a 23-year "megadrought" — the region's worst in about 1,200 years.

• The Phoenix area also faces a projected groundwater shortage, which led officials to restrict new homes lacking other water sources.

State of play: While it's been widely assumed that WIFA will fund desalination efforts, other options — including a pipeline, increased reservoir capacity, potable water reuse and more — remain possible.

• "I envision and think it's probably going to be a combination of multiple things, maybe some bigger, some smaller," WIFA spokesperson Chelsea McGuire tells Axios.
• Phoenix also plans to open a water purification facility by 2030; it could serve other cities as well.

Reality check: Desalination is a promising technology, but there are economic and environmental costs associated with the energy-intensive process.

Meanwhile: Some cities are coming up with their own inventive ways to conserve water or find new sources.

• Queen Creek, Arizona, is buying water directly from an agricultural landowner along the Colorado River — though city officials tell Axios it will be used to replenish groundwater, not fuel new subdivisions.

Editor's note: This story has been corrected to reflect that lawmakers and former Arizona Gov. Doug Ducey established a plan to provide WIFA with $1 billion over three years, not to create WIFA.