Arizona utility regulators seeking access to corporate records, including how they’ve influenced political races, are out of luck unless they can get at least two of their colleagues to go along.
In a new ruling, the state Court of Appeals affirmed that members of the Arizona Corporation Commission have an individual right to look at the books of not only a utility but its parent company.
This legal dispute involves Arizona Public Service, Pinnacle West Capital Corp., and questions about the money it has spent — and may spend in the future — to elect candidates of its choice.
But appellate Judge Kent Cattani said it is the commission as a whole that sets the rules of its operation.
And one of those rules is that the five-member panel, or at least a majority, has to resolve the situation when there are objections to subpoenas.
Cattani also rejected a bid by Bob Burns, who was a member of and chairman of the commission when this legal fight started, to overrule his colleagues who had no interest in pushing APS for the information.
He said that would be amounting to the judiciary “directly interfering” in the operation of the commission which is a separate constitutionally created body.
Strictly speaking, the ruling doesn’t have an immediate effect. That’s because Burns has left the panel and the APS rate case that was pending at the time has been decided.
But Cattani said he and his colleagues decided to weigh in because it’s the kind of situation that can repeat itself.
Burns issued the subpoena in 2016 in a bid to determine if APS or its parent was the source of the $3.2 million spent in 2014 by “dark money” groups that don’t disclose their donors to help elect Republicans Tom Forese and Doug Little to the commission board.
The company initially would not confirm it was the source of those dollars.
It took until 2019 for an admission it actually had put $10.7 million into that campaign. But that took a subpoena from Commissioner Sandra Kennedy which was supported by two other regulators.
That, according to Cattani, is the way it will have to work in the future.
The judge said the powers of commissioners are broad.
A constitutional provision allows the panel and its individual members to “inspect and investigate the property, books, papers, business, methods, and affairs of ... any public service corporation doing business within the state.”
And it also spells out that commissioners can ask courts to enforce subpoenas, including getting witnesses to attend and produce evidence.
But then there are the internal rules about actually enforcing those subpoenas when, as in this case, APS objected.
“Thus, although individual commissioners have the power to issue subpoenas, that power is not without limits when exercised as part of commission proceedings and is instead subject to review and oversight by the commission as a whole,” Cattani wrote.
