Tuesday, August 8, 2017

Arizona Corporation Commission is only 80% corrupt

It’s time to check in on the Arizona Corruption Corporation Commission. The last time I checked was at the end of May in my post, Arizona Corporation Commission: A sack of scoundrels.

The 5-member ACC is entirely populated by Republicans. But that, as we keep learning from the national news, does not mean that they speak with one voice. The fights among the R’s are far more vicious than their quarrel with any D’s. So it is with the attempt by one commissioner, Bob Burns, to get the Arizona Public Service (and its parent company) to open its records and reveal campaign spending in 2014 that (some of us think) resulted in the election of two other commissioners.

This fight, between Burns and the other four commissioners (the 80% in my title), has been dragging on in the courts for some time. So, let’s look in on this drama. For background, I’ll start with a recap of my May 30 post.

Here is what the Arizona state constitution says about the powers of the Arizona Corporation Commission (Article 15, emphasis added).

4 . Power to inspect and investigate
Section 4. The corporation commission, and the several members thereof, shall have power to inspect and investigate the property, books, papers, business, methods, and affairs of any corporation whose stock shall be offered for sale to the public and of any public service corporation doing business within the state, and for the purpose of the commission, and of the several members thereof, shall have the power of a court of general jurisdiction to enforce the attendance of witnesses and the production of evidence by subpoena, attachment, and punishment, which said power shall extend throughout the state. Said commission shall have power to take testimony under commission or deposition either within or without the state.

I read the part in bold as empowering individual members of the ACC to compel, via subpoena, any “public service corporation” to produce evidence of its behaviors. That is what Commissioner Bob Burns is trying to do with respect to Arizona Public Service and its parent company. The issue is what APS did to influence the election of members of the Commission that has jurisdiction over APS.

The other interpretation, championed by attorneys for APS, holds the the “several members” reference in Section 4 means that only the entire Commission, or at least a majority of members, can issue subpoenas.

There is a new legal wrangle reported by Howard Fischer in the Arizona Capitol Times, Judge insists he can decide extent of commissioner’s powers.

A Maricopa County Superior Court judge said he has the legal right to decide whether state regulator Bob Burns has the unilateral power to subpoena utility executives, even in the face of opposition of the other four members of the Arizona Corporation Commission.

In an extensive ruling Monday, Judge Daniel Kiley rejected arguments by Arizona Public Service that he is legally powerless to intercede in what the company contends is a dispute among commissioners.

APS attorney Mary O’Grady said that, at the very least, Burns should have to wait until the commission rules on its pending rate increase request.

But Kiley said this isn’t a simple internal dispute among commissioners. Instead, he pointed out, Burns wants a clear ruling on the scope of his constitutional and statutory authority as an elected member of the panel to compel the production of evidence and examine witnesses.

“Resolving such disputes is clearly within the province of the judiciary,” the judge wrote. “Moreover, Arizona courts have long recognized that declaratory judgment relief is an appropriate vehicle for resolving controversies as to the legality of acts of public officials.”

Kiley also rebuffed an argument by Chairman Tom Forese that the dispute between Burns and the other commissioners is “really a political question” beyond the scope of the judge to resolve. [Forese was one of the two candidates in 2014 who was helped onto the ACC by the $3.2 million (allegedly spent by APS).]

“This case presents issue of constitutional interpretation and statutory construction that are squarely within the scope of judicial authority,” the judge said.

Burns wants documents from APS and parent company Pinnacle West Capital Corp. showing what they spent not only to influence the 2014 election. Two outside groups spent $3.2 million to elect Forese and Doug Little but have refused to disclose their funders.

He also wants information on the company’s spending on lobbyists and charities. And he wants to question CEO Don Brandt and others.

The Arizona Constitution spells out that the commission “and the several members thereof” have the power “to inspect and investigate the property, books, papers, business methods, and affairs of any corporation whose stock shall be offered for sale to the public.” Pinnacle West is a publicly traded corporation.

And the constitution specifically spells out the right to demand documents over regulated “public service corporations” like APS.

It also says that individual commissioners have the same power as a court “to enforce the attendance of witnesses and the production of evidence by subpoena.”

Kiley said it is now up to him, as the judge in the case, to decide whether the constitution and parallel statutes give Burns the independent powers he claims he has.

You can fill in the details at the Capitol Times report. If you run into a pay wall, try the Daily Star’s reprint, Judge to decide if commissioner can subpoena utility executives.

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