Restoring trust after torpedoed campaigns
Arizonans now know what has been suspected for years – that Pinnacle West, the parent company of Arizona Public Service, secretly spent more than $10 million in 2014 to defeat pro-clean energy commission candidates Vernon Parker, Lucy Mason and Sandra Kennedy.
Ultimately, APS elected the commissioners it wanted.
I ran the campaigns for Mason and Parker. Parker is a long-time friend and Mason is one of the hardest-working public servants in Arizona, so I considered it an honor to help both of them.
Ironically, two people who worked for me almost a decade ago were leading the effort on behalf of APS against Parker, Mason and Kennedy.
APS ran one of the most aggressive campaigns I’ve witnessed in 20 years as a political consultant. Parker, Mason and Kennedy never had a chance, vastly outspent by the monopoly they sought to regulate.
When Arizona became a state in 1912, monopoly powers were granted to utilities. In turn, those utilities agreed to come under the governance of a sepa
rate branch of government — the Corporation Commission. These utilities agreed to act in the public interest and be independently regulated.
Breaking with a century-old tradition, Arizona Public Service funded the campaigns of the candidates it wanted on that once-independent commission, shattering all trust that consumers would get a fair shake when the commission sets the utility’s rates.
APS’ secret involvement in the 2014 campaign has raised numerous legal and ethical questions, the most serious of which centers on whether public corruption occurred in 2014.
Recent reports seem to indicate that an FBI investigation that started several years ago related to APS’ 2014 campaign spending may be ongoing. In the best-case scenario, no public corruption occurred.
Regardless, it is undeniable that APS directly influenced the election of commissioners who are responsible for regulating the state’s largest utility, leaving the perception that APS has captured its regulators.
So, what should the commission do now?
Call for public hearings. Place people under oath. The paper documents APS released in response to the threat of commission subpoenas are likely a small aspect of what really occurred. Ask hard questions and demand honesty. Determine whether decisions approved by the commission have resulted in higher costs for customers.
Propose a constitutional amendment or rule change that any entity regulated by the commission and contributes more than $100,000 to influence the campaigns of commission candidates be prevented from doing business before the commission for at least four years. Ratepayers deserve an independent commission without even a taint of suspicion.
Fine APS for past involvement in corporation commission races, cap its profit in the next rate case or revisit key decisions affecting the company’s profitability to demonstrate to the public that this behavior is unacceptable.
New APS president Jeff Guldner's top
priority should be restoring the company's reputation to pre-2014 political involvement. That means he should:
Pledge to never again fund campaign activity for Corporation Commission candidates or any other political candidates in Arizona.
Aggressively invest in renewable energy like solar and wind, energy efficiency and electric vehicle implementation. Take an eraser to years past and move to the future.
Arizona deserves better from APS. The company must exorcise its worst demons and regain the moral clarity it had prior to 2014.