Phoenix, Ariz. —The Arizona Corporation Commissioners voted on 32 matters, including electric and water utilities, railroad, and securities items. Highlights from the meeting include:

UTILITIES

• Trico Electric Cooperative’s Unlimited EV Charging Pilot Approved for 1,000 Residents
• Commission Adjusts Lazy C Water Service Rate
• Rate Increase for Graham County Electric Cooperative, Inc’s Water Division
• Commission Approves Rate Adjustments for Truxton Water Utility
• Commission Approves Emergency Financing for Ponderosa Utility

LINE SITING

• Substantive Policy Statement to the Line Siting Committee

SECURITIES

• Commission Orders More than $7.2 Million in Restitution for Investors Defrauded by Commercial Real Estate Promoters
• Commission Finds Mesa Woman Misled Investors about New Medical Device
• Chandler Man Admits to Providing Investment Advisory Services without a License
• Commission Sanctions Chandler Man and Denies License Application

RAILROAD

• Ruling Endorses on ADOT Application to Upgrade Four Rail Crossings on the 202
• Traffic Signal Installation Approved for Sahuarita at Quail Crossing Blvd and Old Nogales Hwy Intersection

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UTILITIES

Trico Electric Cooperative’s Unlimited EV Charging Pilot Approved for 1,000 Residents

The Arizona Corporation Commission approved an experimental Residential Unlimited Electric Vehicle (R-EV-U) Tariff Pilot Program. The tariff aims to incentivize off-peak EV charging by offering a monthly recurring charge of $64.00 to $71.00 based on charging equipment capacity, and a $0.25 per kWh rate for on-peak charging. Off-peak charging incurs no per kWh rate. The program is available to up to 1,000 residential customers and excludes certain customer categories like those with Trico loans or special billing.

Customers must meet specific criteria, including proof of EV ownership and agreement to sub-metering, to participate. The Commissioners support the program, noting that it will likely encourage off-peak EV charging, helping Trico manage demand and system efficiencies.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number E-01461A-23-0149

 

Commission Adjusts Lazy C Water Service Rate

Setting a rate base of $465,793 and with a rate of return of 7.21% resulting in a revenue requirement of $199,763. Rate changes will increase the median monthly bill for customers from $66.66 to $75.67. A rate case surcharge of $0.33 per customer was approved, while Lazy C's proposed Repair and Replacement Surcharge was denied. Lazy C is mandated to update its Curtailment Tariff and monitor water loss, filing a report within a year.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number W-01536A-23-0114

 

Rate Increase for Graham County Electric Cooperative, Inc’s Water Division

GCEC, a Class C utility serving around 2,000 water member-customers and 8,600 electric member-customers near Safford, Arizona, has seen growth through mergers and extensions. The Commissioners approved GCEC's rate application, agreeing on a Fair Value Rate Base (FVRB) of $7,625,933 and a total revenue requirement of $2,072,318. The new rates will result in a 53.2% increase in the typical residential bill, from $38.21 to $60.24.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number W-01749A-22-0310

 

Commission Approves Rate Adjustments for Truxton Water Utility

Truxton, a Class D water utility near Kingman, Arizona, serves around 1,012 customers and is managed by Blackhawk Developers, LLC. The utility is wholly owned by the Claude K. Neal Family Trust, which also owns Cerbat Water Company. The two companies share expenses at a 75-25% split. The Commission approved Truxton's Fair Value Rate Base (FVRB) at $464,864 and sets an Operating Revenue of $639,957, an 8.71% increase over test year revenues.

The Commission sought to correct the allocation of expenses between Truxton and its affiliate Cerbat, particularly around the purchases of Ford trucks and debt service for WIFA loans. The approved rates result in an Operating Income of $70,785, a 15.32% Rate of Return (ROR) on the FVRB, and an Operating Margin of 11.06%. The typical residential monthly bill for a 3/4-inch meter customer will rise by $3.36, or 16.4%, from $20.49 to $23.85.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number W-02168A-22-0302

 

Commission Approves Emergency Financing for Ponderosa Utility

The Arizona Corporation Commission has approved Ponderosa Utility Corporation's application for emergency financing through the Water Infrastructure Finance Authority of Arizona (WIFA). Ponderosa, a Class D utility serving around 647 customers near Flagstaff, sought the loan to address urgent needs such as a failed well pump, electrical repairs, and road maintenance. Initially requesting $83,830, the approved loan amount was reduced to $78,854, excluding water hauling costs covered by an existing tariff. It also mandates that Ponderosa file for a permanent rate adjustment within 12 months. The loan will result in a monthly surcharge of approximately $0.86 per customer.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number W-01717A-23-0211

 

LINE SITING

Substantive Policy Statement to the Line Siting Committee

The Arizona Corporation Commission has updated its guidelines for utilities seeking a Certificate of Environmental Compatibility (CEC) for constructing plants or transmission lines. The update comes in response to outdated line siting statutes and a backlog of CEC applications. House Bill 2496, signed into law on April 5, 2023, clarifies the definition of "transmission line," notably excluding "substations" from requiring a CEC. It also clarifies for the public that the Commission does not have jurisdiction over the undergrounding of electric transmission lines.

It does discourage utilities from incurring higher costs for their customers by undergrounding lines unless necessary for reliability or safety purposes. The Commission has also adopted policy statements to provide further guidance. These include the Commission's interpretation of the updated "transmission line" definition and its preferred approach to conducting hearings, affirming the use of hybrid virtual and in-person hearings for increased public participation.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number ALS-00000A-22-0320

 

SECURITIES

Commission Orders More than $7.2 Million in Restitution for Investors Defrauded by Commercial Real Estate Promoters

The Commission ordered respondents William M. Deegan of Scottsdale and his affiliated companies to pay $7,204,390 in restitution and a $100,000 administrative penalty for committing securities fraud in connection with a commercial real estate venture. The Commission found Mr. Deegan, a former securities salesman barred from the securities industry in 2004 for selling private investments not authorized by his securities dealer, controlled affiliated commercial real estate companies, Heartland Capital Partners, LLC, and Heartland Income Properties, LLC. Further, Deegan and Heartland Income Properties ignored a 2022 temporary cease and desist order issued by the Commission for fraudulently selling LLC interests in Heartland Income Properties while not registered.

Deegan and Heartland Income Properties failed to inform several investors about the Commission’s legal action. Heartland Capital Partners was also liable as a control person for the securities fraud violations. In settling this matter, the respondents admitted to the Commission’s findings only for the purposes of this proceeding but agreed to the entry of the consent order.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number S-21189A-22-0095

 

Commission Finds Mesa Woman Misled Investors about New Medical Device

The Commission sanctioned respondents Kelly Marie Ryan of Mesa and Premier Media Services, Inc. for committing securities fraud in connection with a newly invented medical device called a needleless injector. The Commission ordered Kelly Marie Ryan and Premier Media Services to pay a total of $300,500 in restitution for their violations. Respondents are also ordered to pay administrative penalties in the amount of $90,000 each, of which $30,000 of the penalties are for the fraud violations. The Commission found that, while not registered to sell securities in Arizona, Ms. Ryan and her company made multiple misrepresentations and material omissions to at least six investors, some of whom were medical professionals.

Ms. Ryan also failed to disclose her prior criminal conviction and prison sentence for securities and wire fraud as well as an administrative order by the U.S. Securities and Exchange Commission for securities violations. Additionally, the Commission found Ms. Ryan and her company misled investors about being involved in the FDA approval process of the needleless injection device when they were not. They also misled investors about how the investment proceeds would be used, the value of the medical device and the rightful ownership of the patent.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number S-21176A-21-0412

 

Chandler Man Admits to Providing Investment Advisory Services without a License

The Commission ordered respondents David F. Evans of Chandler and Q Financial Design, LLC, to pay a $1,000 administrative penalty for providing investment advisory services for compensation without being licensed. The Commission found that, for more than 11 years, Q Financial Design and Mr. Evans had been licensed in Arizona as an investment adviser and investment adviser representative. However, despite multiple notifications by the Financial Industry Regulatory Authority, they failed to renew their licenses and pay the required fees for 2022. Mr. Evans and Q Financial Design continued to provide investment advisory services to eight clients and collected fees for these services without the required licensing.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number S-21257A-23-0204

Commission Sanctions Chandler Man and Denies License Application

The Commission ordered respondents Robert A. Ritter and RRIM Asset Strategies, LLC (RRIM) to pay $32,430 in restitution and a $10,000 administrative penalty for providing investment advisory services for compensation without being licensed. The Commission also denied their Arizona license applications due to multiple deficiencies that were not corrected. The Commission found that Mr. Ritter and RRIM transacted business in Arizona as an investment adviser representative and investment advisory firm, managing the investment accounts and portfolios of approximately 30 clients. The restitution amount represents the total commissions Mr. Ritter and RRIM received from their Arizona clients.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number S-21215A-22-0303

 

RAILROAD

Ruling Endorses on ADOT Application to Upgrade Four Rail Crossings on the 202

The Commission approved an ADOT application to expand four grade-separated crossings on SR202 near Arizona Avenue, Chandler. The project aims to widen these bridges and add General-Purpose Lanes on SR202. Construction kicks off in January 2024, with a 24–30-month timeline. Funding comes from the Federal Highway Administration and ADOT, and no train-related traffic disruptions are anticipated.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number RR-03639A-23-0144

 

Traffic Signal Installation Approved for Sahuarita at Quail Crossing Blvd and Old Nogales Hwy Intersection

Sahuarita plans to enhance the intersection at Old Nogales Highway and Quail Crossing Boulevard with a 

a new traffic signal and railroad preemption. This is part of a broader initiative already underway to connect key residential and shopping areas via Quail Crossing Boulevard. The project includes various roadway improvements, such as new signage and lighting and has a 24-month deadline for completion, accommodating UPRR’s supply chain concerns. Maintenance responsibilities are divided between Sahuarita for road elements and UPRR for railroad components.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at edocket.azcc.gov and entering docket number RR-03639A-23-0096