1.  A public water system may receive credits, as provided in this section, for the addition of new customers to the system. The granting of a credit pursuant to this section must be limited to public water systems in areas:

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(a) Designated as groundwater basins by the State Engineer pursuant to the provisions of NRS 534.030; and

(b) For which the State Engineer has issued an order for granting a credit pursuant to this section.

2.  A public water system which provides service in a groundwater basin is entitled to receive a credit for each customer who is added to the system and:

(a) Voluntarily ceases to draw water from a domestic well located within that basin; or

(b) Is the owner of a lot or other parcel of land, other than land used or intended solely for use as a location for a domestic well, which:

(1) Is located within that basin;

(2) Was established as a separate lot or parcel before July 1, 1993;

(3) Was approved by a local governing body or planning commission for service by an individual domestic well before July 1, 1993; and

(4) Is subject to a written agreement which was voluntarily entered into by the owner with the public water system pursuant to which the owner agrees not to drill a domestic well on the land and the public water system agrees that it will provide water service to the land. Any such agreement must be acknowledged and recorded in the same manner as conveyances affecting real property are required to be acknowledged and recorded pursuant to chapter 111 of NRS.

3.  If a county requires, by ordinance, the dedication to the county of a right to appropriate water from a domestic well which is located on a lot or other parcel of land that was established as a separate lot or parcel on or after July 1, 1993, the county may, by relinquishment to the State Engineer, allow the right to appropriate water to revert to the source of the water. The State Engineer shall not accept a relinquishment of a right to appropriate water pursuant to this subsection unless the right is in good standing as determined by the State Engineer. A right to appropriate water that is dedicated and relinquished pursuant to this subsection:

(a) Remains appurtenant only to the parcel of land in which it is located as specified on the parcel map; and

(b) Maintains its date of priority established pursuant to NRS 534.080.

4.  If an owner of a parcel of land specified in subsection 3 becomes a new customer of a public water system for that parcel of land, the public water system is entitled to receive a credit in the same manner as the addition of any other customer to the public water system pursuant to this section.

5.  The State Engineer may require a new customer, who voluntarily ceases to draw water from a domestic well as provided in paragraph (a) of subsection 2 or whose right to appropriate water is dedicated pursuant to subsection 3, to plug that well.

6.  A credit granted pursuant to this section:

(a) Must be sufficient to enable the public water system to add one service connection for a single-family dwelling to the system, except that the credit may not exceed the increase in water consumption attributable to the additional service connection or 2 acre-feet per year, whichever is less.

(b) May not be converted to an appropriative water right.

7.  This section does not:

(a) Require a public water system to extend its service area.

(b) Authorize any increase in the total amount of groundwater pumped in a groundwater basin.

(c) Affect any rights of an owner of a domestic well who does not voluntarily comply with the provisions of this section.

8.  As used in this section:

(a) ’Domestic well’ means a well used for culinary and household purposes in:

(1) A single-family dwelling; and

(2) An accessory dwelling unit for a single-family dwelling if provided for in an applicable local ordinance, including the watering of a garden, lawn and domestic animals and where the draught does not exceed 2 acre-feet per year.

(b) ’Public water system’ has the meaning ascribed to it in NRS 445A.840.