The state Supreme Court has agreed to decide whether a majority of the Arizona Corporation Commission can block one of its members from seeking access to corporate records to see if the company is funneling βdark moneyββ into the campaigns of regulators.
In a brief order, the justices agreed to review a Court of Appeals ruling that denied Bob Burns, who was a member of the panel, the independent right to look at the books of Arizona Public Service and Pinnacle West Capital Corp., its parent. Burns specifically wanted to know about the money it has spent β and may spend in the future β to elect candidates of its choice.
The order, by itself, does not guarantee Burns will win his multiyear battle with the stateβs largest electric utility.
It is, however, a setback for APS whose lawyer had urged the justices to leave in place the appellate court ruling which concluded that such investigations require the consent of a majority of the commission. In fact, the remaining commissioners also had asked the Supreme Court to stay out of the fray.
The decision of the justices to weigh in will have no immediate effect. Thatβs because Burns has left the panel and the APS rate case that was pending at the time has been decided.
But if the court ultimately sides with Burns, that could forever change how the Corporation Commission operates, giving future commissioners more independent license to probe the actions of regulated utilities.
Burns issued a 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 βdark moneyββ groups that donβt 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.
Burns contends β and wants the Supreme Court to rule β that individually elected regulators have power on their own and are not subject to being overruled by their colleagues.
His attorney, William Richards, told the justices there is no authority for the appellate court conclusion that the Arizona Constitution, which spells out the power of the utility regulatory board, allows a majority of commissioners to forbid individual members from using their investigatory powers.
βThe Court of Appeals decision undermines these objectives and gives the worst corporate offenders a clear playbook,β Richards wrote. βThey need only spend enough to capture the loyalty of a majority of the commissioners to receive favorable treatment, and to stop any commissioner dissenters from gathering facts and discussing matters that might hurt or expose them.ββ
The Supreme Court order was not a total victory for Burns.
The justices rebuffed a request by Burns to also consider whether he also has the power to to investigate whether the millions of dollars of campaign support that other utility regulators had received tainted them to the point where they might have to recuse themselves on voting on the companyβs rate hike proposals.
