I looked into this and saw this as well, but Rio Verde Foothills is a tiny community far northeast of Scottsdale. It seems like more of a political issue (i.e., people who aren't paying taxes to the city are benefitting from the city's management of water resources), than a technological issue.
With the unincorporated town that... lets say "has a dislike of government" it becomes difficult for Scottsdale water district to implement the same restrictions for other areas.
> Incorporating could give the community more options for water supply in future but forming an official town or city brings requirements, such as paved roads, street lights, more taxation and rules. This would be expensive but also change the secluded, quaint feel of Rio Verde Foothills, where people own chickens, donkeys, horses and ride motorbikes straight out their doors to nearby Tonto national forest.
> And forming a new water utility district doesn’t appeal either, with residents reluctant to have another government agency overseeing their neighborhood.
https://www.azfamily.com/2023/05/16/arizona-legislature-pass...
https://www.scottsdaleaz.gov/Assets/ScottsdaleAZ/News/News+I...
https://kjzz.org/content/1847190/scottsdale-wants-governor-v...
https://www.azcentral.com/story/opinion/op-ed/joannaallhands...