Arizona Corporation Commissioner Bob Burns has filed his dissent opinion in the Arizona Water/Cornman Tweedy matter that involved the extension of Arizona Water Company’s service area. The matter made headlines earlier this year, when Commissioner Andy Tobin made a highly questionable maneuver to block a legal order that had been supported by a majority of commissioners.
On Thursday, Commissioner Burns released a statement in which he expressed his “grave concern as to future actions of the Arizona Corporation Commission and the potential adverse impacts on regulated companies and their rate payers,” due to “the possibility of regulatory abuse or regulatory over-reach.”
“Arizona Water Company, a Corporation Commission regulated utility, after being granted a legal order by a majority vote of the Commissioners was, through a highly irregular process, ordered into settlement discussions with a developer, Cornman Tweedy (a Robson Company),” according to Burns. “Cornman Tweedy opposed the majority vote of the Corporation Commission. After reaching a settlement, as ordered, it seems the settlement was viewed as too good of a deal for Arizona Water Company and the settlement was amended by the Corporation Commission to reduce the benefit to Arizona Water Company.”
“The end result is that rate payers will eventually pay higher rates than they would otherwise because of the additional cost of the benefit received by Corman Tweedy,” noted Burns.
“Some might ask why Arizona Water Company was not more aggressive in its opposition to violation of its due process rights caused by the irregular process used in this case. Arizona Water Company is a regulated utility with a number of divisions continually requiring Corporation Commission decisions. To aggressively protect its rights could be viewed by some on the Corporation Commission as defiance.” Burns concluded, “Few, if any, regulated utilities want to be viewed as defiant of the Corporation Commission. To that point, in the very next item on the same open meeting agenda Arizona Water Company was requesting a rate increase for one of its divisions.”
In April 2017, attorneys for Arizona Water Company requested a rehearing in a matter involving its Certificate Of Convenience And Necessity. In its application, the company accused the Commission of violating its due process rights.
In February, the Commission approved the company’s Certificate Of Convenience And Necessity (CC&N), in a 3-2 vote. In Arizona, companies must obtain a CC&N through the Commission in order to provide water in a defined service area.
Commissioners Tobin, Doug Little, and Bob Burns voted in favor of Arizona Water.
Then at the April 5, 2017 Open Meeting, the Commission then voted to reopen and reconsider its February 2017 decision. According to the application, “The impetus for reconsidering the February decision was not new evidence related to the CC&N dispute, but the reservations of a single Commissioner who had voted in the majority and believed that “the issue of the CC&N needs a deeper dive.”
Tobin’s “deeper dive” essentially vacated the February 7, 2017, vote to approve the December 22, 2016 Recommended Opinion and Order in Arizona Water’s favor and denied Cornman Tweedy’s request to delete the portion of Arizona Water’s CC&N that includes property owned by Cornman Tweedy.
Arizona Water has been engaged in a legal battle with Cornman Tweedy 560 L.L.C. over the CC&N for years. The move by Tobin forced Arizona Water back to the negotiating table with Cornman Tweedy.