Arizona regulator subpoenas APS in political influence probe

Dive Brief:

Arizona Corporation Commissioner Robert Burns has issued a subpoena to Arizona Public Service Co. (APS) and its parent company Pinnacle West to ascertain whether the companies funded election campaigns for the regulatory commission during the 2014 election cycle.
In the subpoena, Burns said the companies must submit certain documents by Sept. 15 and appear in person to answer questions on Oct. 6. He noted an APS executive confirmed in an August earnings call that the company received subpoenas from the U.S. Attorney's office for the district of Arizona regarding the 2014 election cycle, cementing the need for this inquiry.
Burns prepared a list of questions to obtain records dating back to 2011 that contain APS' charitable, political and lobbying expenses to see if the utility broke company policy of not being involved in electing candidates at the commission.

Dive Insight:

It's been a heated summer in Arizona, with regulatory hearings over solar issues being overshadowed by allegations of improper influence at the Arizona Corporation Commission.

While his colleagues voted to defund his probe into improper influences two weeks ago, Burn has remained undeterred. As the ACC voted 3-1 to nix his inquiry, they told Burns he could subpoena the companies — and he did just that. His decision to continue the probe comes as he gears up for his own re-election campaign this year, with backing from SolarCity. SolarCity's support comes after Burns requested utility companies stay out of the election and its financing, in hopes of avoiding the dark money controversy that has clouded the 2014 election.

The 2014 election cycle has remained a thorn in the commission's side. During the election, solar advocates questioned whether current commissioners Doug Little and Tom Forese held close ties with the state's utilities. APS faces allegations that it funneled $3.2 million into independent groups that supported Little's and Forese's campaigns.

Chairman Little, in particular, has condemned Burns' attempts to investigate possible political influences at the commission.

"You've been basically impugning my integrity for a year," Little said to Burns before the vote earlier this month, arguing the probe would be a waste of time and degrading to the commission. Little maintains he ran a clean campaign.

APS has neither confirmed nor denied the allegations from Burns. But the political furor has dogged the Commission, threatening to distract from high-profile rate cases and a value of solar docket, which could inform the future of solar rate design in Arizona and nationwide. The Federal Bureau of Investigation opened an investigation earlier this year into the election issues, questioning former Commission officials and APS executives.

Last year, Burns, along with former Commission Chairwoman Susan Bitter Smith — who resigned earlier this year due her work with a cable group — opened a generic docket calling for a policy to prohibit utilities and other "unregulated entities" from supporting ACC candidates. In a follow-up letter, Burns demanded Don Brandt, CEO of Pinnacle West, to turn over financial records pertaining to political contributions.

But Burns is no stranger to controversy himself when it comes to relationships with entities that the ACC regulates. He has been investigated for ties to a telecommunications trade group that still listed him as a lobbyist when he took office, despite claims that he cut ties before joining the ACC.