Page 8 - the NOISE March 2016

BURNS DRAWS A LINE IN THE SAND WITH APS
LEFT: APS CEO Don Brandt ABOVE: Commissioner Bob Burns
In the last few months, Commissioner Bob Burns of the Arizona Corporation Commission has been engaged in a battle of will and words with Pinnacle West Chairman, President and CEO Don Brandt. Pinnacle West is the parent company of Arizona Public Service Company, the largest public utility provider in the state. Mr. Burns started out by simply asking APS, a company that is regulated by the ACC, to refrain from making campaign contributions that involve the commission in its upcoming election cycle. After Mr. Brandt essentially told him to pack sand, Mr. Burns is drawing a harder line, but not without remorse.
In a “Notice of Investigation” dated January 29, Mr. Burns stated “It is with regret that I now embark upon the next stage of my inquiry into APS’ possible campaign contributions. Originally, I had hoped to address these concerns by focusing upon APS’ future behavior, and to that end, I asked APS last year to voluntarily agree to refrain from making political contributions concerning the Corporation Commission in the upcoming election cycle. You rejected that proposal.”
Arizona Law states that “the commission, each commissioner and person employed by the commission may, at any time, inspect the accounts, books, papers and documents of any public service corporation.” Citing this statute six times in his page and a half letter to Mr. Brandt, Mr. Burns announced his intention “to initiate an investigation pursuant to my authority under ARS § 40-241 to determine whether APS has used above-the-line funds for political, charitable, or other donations.”
Mr. Brandt has claimed that APS has a First Amendment right to contribute to political campaigns in an effort to elect commissioners that will be favorable to the company’s interests. Mr. Burns states that he has no desire to infringe on this right but that “In the current climate, there is a public perception that APS has used funds earmarked for its costs of service to support various political campaigns. Recently, I have become concerned about the lack of transparency for all of APS’ below-the-line expenditures.”
Since Mr. Brandt emphatically refused Mr. Burns’request to step away from the ACC’s upcoming elections, the commissioner stated “I now intend to broaden my inquiry to include funds expended on all political contributions, lobbying, and charitable contributions, i.e., all donations made − either directly or indirectly − by APS or under APS’ brand name for any purpose.”
Quoting figures from APS’ 2014 Federal Energy Regulatory Commission Form 1, a federal annual report required of large electric utility companies, Mr. Burns notes that APS reported “donations” of $1,998,442 and “expenses for civic, political & related activities” of $2,883,694. “I am interested in examining APS’ books and records to determine the specific expenditures that make up these amounts,” he stated. In addition, Mr. Burns said he intends “for those
examinations to be conducted under oath so that a written record may be publicly filed.”
Just to be sure that there is no confusion on the matter this time, Mr. Burns closes the notice stating that “unlike my previous communications, this letter is not intended as a request, but is instead a requirement for your cooperation under ARS § 40-241. I look forward to your full
compliance in this matter.”
But not all of the ACC’s commissioners are on board for this investigation; especially not the
ones who have been accused of benefitting from the nearly $5 million in APS and Pinnacle West contributions to their campaigns. Commissioners Doug Little − who, by the way, was confirmed on February 2 as the new ACC Chairman by the commission − and Tom Forese have been the main focus of on-going “dark money” investigations that include more than $3 million in indirect contributions to their 2014 elections from the two companies. And Arizona Governor Doug Ducey, who just appointed Andy Tobin to fill the ACC seat left vacant by Susan Bitter Smith’s resignation over conflict of interest accusations, also received at least $55,000 from Pinnacle West for his winning 2014 campaign. Not to mention Arizona Attorney General Mark Brnovich’s election that year supported by $450,000 from Pinnacle West.
Speaking of Mr. Tobin — the new commissioner who is a former Arizona State Representative and House Speaker — joined the ACC after Ms. Bitter Smith resigned to avoid a lawsuit filed by the AG’s office accusing her of a conflict of interest regarding her work for a cable company regulated by the ACC. Not long after his appointment, the Arizona Republic broke the news that Mr. Tobin has his own personal conflict in serving on the ACC. His son-in-law is employed by SolarCity Corp − a rooftop solar installation company. Apparently, this potential issue passed
8 • MARCH 2016 • the NOISE arts & news • thenoise.us
STORY BY
CINDY COLE
by the governor’s office when considering his appointment. While SolarCity is not directly regulated by the ACC, the company has a stake in nearly every electric utility decision the ACC makes because the state has a requirement under its Renewable Energy Standard & Tariff rules that utilities get a portion of their power supply from renewable resources.
Shortly before his swearing in on February 2, Mr. Tobin announced that he would recuse himself from any votes that might result in a perceived conflict of interest under the advice of the ACC’s attorney. “There could be a lot of recusals,” he said. Those recusals will not only prevent Mr. Tobin from voting on just about any decisions that involve APS, they could also result in 2-2 deadlocks on votes of the five member commission. Deadlocked items do not pass the commission. In 2013, in fact, there was a vote that involved APS and rooftop solar customers that passed by a count of 3-2. Mr. Tobin has been appointed only to serve out Ms. Bitter Smith’s current term, which ends this year. He has not announced whether he will run for a full term of his own after that.
In spite of having his hands tied on APS-related issues, Mr. Tobin decided to exercise his office anyway and placed an item on the agenda for the ACC’s February 10 meeting. He individually requested “discussion, consideration and possible vote regarding the Notice of Investigation issued January 28, 2016.” As mentioned, it seems that some commissioners are not 100% behind Commissioner Burns’demand that APS open its books. Though at press time, a call to Mr. Tobin’s office for more details regarding his request went unanswered, it seems that Mr. Burns’ right to conduct an investigation on his own might be challenged. But, once again referring to ARS § 40-241, “each commissioner and person employed by the commission” is granted the right to inspect the books and documents of a company under the ACC’s jurisdiction.
The day before the ACC’s official meeting, Mr. Burns asked for AG Brnovich’s opinion on whether he has the legal backing for his investigation. On the morning of February 10, Commissioner Forese pulled the discussion and possible vote on the issue from the agenda. He cited a desire for additional legal advice. As an agenda item can only be pulled once, the delay will give the AG’s office time to decide if it will offer an opinion in the matter before Mr. Tobin or any other commissioner chooses to bring it up again.
While all this public grand-standing and demands of APS to release sensitive information by Mr. Burns is admirable, he certainly is not without blemish on the public disclosure front. In fact, late last year, Mr. Burns made statements attempting to protect the content of text messages sent between Commissioner Bob Stump and suspected “dark money” outfits during the 2014 elections. He called demands to release the information “fishing expeditions” and proposed that future public records requests be handled more like criminal arrest warrants.
“The police don’t come into your home without a warrant,” he said, “There’s [sic] limitations and requirements to be met.” He suggested that the costs for retrieving data be considered and that changes to the public requests statute should be made with those costs in mind.
In addition, Sedona activist Warren Woodward has had an on-going case against Mr. Burns accusing him, too, of having a conflict of interest in serving on the ACC. Commissioner Burns was registered as a lobbyist for the Arizona Telecommunications & Information Council, an organization that represents companies regulated by the ACC, until September 15, 2015. He was elected to the ACC in 2013. Mr. Burns has dismissed the accusations as a simple clerical error that failed to remove his name from the ATIC list of lobbyists. He claims that he has not actively lobbied for the ATIC in any form either during his campaign or since his election. The AG’s office has refused to pursue the matter so Mr. Woodward has taken his claim to the Arizona Supreme Court, where it is pending consideration. “The ‘oversight’ that actually occurred was entirely Burns’ for not knowing the statutory eligibility requirements of the office he sought,” stated Mr. Woodward in an article detailing his fight to have Mr. Burns removed as a usurper.
“Burns’ ignorance of the law does not excuse him from its application.”
| Cindy Cole has noticed her APS bill includes many line items, not one of which is for political campaigning. cindy@thenoise.us
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