Commission could seek answers on APS spending in secretary of state race

Why did Arizona Public Service spend hundreds of thousands of dollars to try to help a corporation commissioner’s son get elected secretary of state?

It’s an unanswered question that’s still lingering from the utility company’s secret election spending binge from 2014. And it’s a question that the Corporation Commission could finally get some answers to when Pinnacle West and APS CEO Don Brandt, who will retire in November, appears before the commission on Wednesday.

Late last week, the commission added an item to the agenda for Wednesday’s special meeting. 

The commission had already been slated to question Brandt about APS rules about disconnection of power, an issue that came to the fore in June after it was revealed that an elderly woman in Sun City died after the company shut off her power on a 105-degree day over an unpaid $51 bill. 

Now, the commission’s agenda includes APS and Pinnacle West’s “campaign expenditures and political participation” in 2012, 2014 and 2016. 

Commission Bob Burns said the item was added at the request of himself and Commissioner Sandra Kennedy, APS’s loudest critics on the five-member regulatory body. Burns said his primary concern is the millions that APS spent to influence Corporation Commission races, which was a departure from the utility’s long-held practices. 

Burns wouldn’t rule out the possibility of questioning Brandt about his company’s spending in the 2014 race for secretary of state. But he said that won’t be his focus either.

“My focus is the commission,” Burns said. “The past is gone. We need to know what’s going to happen in the future.”

Kennedy, however, made clear that the secretary of state’s race, along with APS spending in Corporation Commission races, is on her radar.

Asked via text message whether she planned to ask Brandt about the secretary of state’s race on Wednesday, or just about expenditures in Corporation Commission races, Kennedy responded, “ALL SPENDING IS ON THE TABLE!”

In all, between 2013 and 2018, APS spent more than $182 million on lobbying, marketing, grants, and political spending – or $152 per customer.

In response to subpoenas from Burns and Kennedy, APS in March acknowledged what had long been widely believed: It was the source of $10.7 million in dark money spending during the 2014 election. APS had never admitted that it was the source of the money, which was funneled through the Arizona Free Enterprise Club and Save Our Future Now, two nonprofit organizations, to hide its source.

Most of that money was spent that year’s Corporation Commission races, including to help defeat Kennedy, a Democrat, in the general election. But $733,000 was spent to aid Justin Pierce in the Republican primary for secretary of state.

The spending on Pierce’s behalf raised eyebrows because he is the son of Gary Pierce, who at the time was the Corporation Commission chairman. Pierce in 2013 made a key procedural move to shut down an ongoing debate over a deregulation proposal that could have stripped APS of its monopoly status, which would have been a financially devastating blow to the company. 

Though APS has historically shied away from spending money to influence elections for Corporation Commission, it’s obvious why it would want to do so. Since the company began spending heavily on commission races in 2014, its stock value has risen substantially. 

But there seems to be no obvious upside to spending in secretary of state races. The position is first in the line of succession to the governor’s office, which has come into play repeatedly since the early 1970s. But APS has no record of that level of spending in races for secretary of state, or for governor, for that matter, either before or after 2014. 

Even after it admitted its role in the 2014 election, APS refused to comment on why it waded into the secretary of state’s race on behalf of the son of a critical ally on the commission.