MOHAVE COUNTY, ARIZ., IS A CERTIFIABLE desert, but it boasts 158 square miles of water, including Lake Havasu and other parts of the Lake Mead National Recreational Area. That gives many the impression that there's plenty of water to support new development. But they couldn't be more wrong. Just ask the many home builders vying to create communities along the 100 or so miles of U.S. 93 between Kingman, Ariz., and rapidly expanding Las Vegas.

State laws and local regulations could keep home builders such as Las Vegas–based Rhodes Homes from building hundreds of thousands of homes in this rural county of 93,000 people.

Gold originally spurred development of the county (founded in the late 1800s), but water is the most valuable resource today. And despite the lakes, it's in short supply. That's why a state law requires developers to submit their plans to the Department of Water Resources (DWR), which determines if enough water is present to support the number of homes for 100 years.

“This is an eminently sensible requirement,” says Ronnie Cohen, senior policy analyst with the Natural Resources Defense Council in San Francisco. “Even in drought years, you need to be able to meet people's basic needs.” Water consumption in the area varies from 107 gallons per capita daily in Tucson, Ariz., to 230 gallons per capita daily in Las Vegas.

Rhodes Homes has proposed creating a 160,000-home community in the White Hills as well as a private water company, Perkins Mountain Water Co., to develop and manage the water and sewer infrastructure. The DWRruled that the existing water supply is not adequate to support the first phase of 32,000 homes. The report found only enough water to support about half that number of households.

The ruling itself doesn't stop the project. The law simply requires developers to inform potential buyers of the findings. But the findings could influence the Arizona Corporation Commission, the sole agency with the power to enforce water-supply regulations in the state's rural areas. It has the power to deny the Perkins Mountain operating certificate. Without that, the project can't go forward.

“The issue is whether or not we can approve developments when adequate water supply hasn't been proven,” says Jeff Hatch-Miller, the commission's chairman.

“The commission is the final arbiter,” he says. “We have a variety of choices: conditional approval; an order preliminary, which means they can do nothing until water supply is proven; or denial.” The commission is expected to render a decision this spring.

County officials have their hands full with six proposed developments attempting to enter the county. “That many homes would almost double the present Mohave County population,” says Pete Byers, Mohave County supervisor for District One. “Our present rural atmosphere would definitely change. But if we handle things properly, by the law, and make sure that every development goes through all of the correct procedures in place with our Planning and Zoning department and other county and state requirements, our future can be very bright.”

Byers continues: “Basically, if they can show us the water, they can work toward the next permit and requirement. If they can't, they will have to downsize or stop. I am not anti-development. I'm concerned about growth, just as I was concerned about the lack of it during recessionary years.”

But, he says, he has to look forward: “We take a long time researching every development proposal. Many of our existing rural residents are on private wells. Our new master planned community proposals have to meet far more stringent requirements in protection and wise use of our natural resources than our earlier settlers. Conservation is primary to our future. And right now, our future is on the drawing board.”

Margot Carmichael Lester is a freelance writer based in Carrboro, N.C.

Learn more about markets featured in this article: Phoenix, AZ, Tucson, AZ.